Harvia’s Financial statements bulletin 2019: Strong and profitable growth continued

Stock Exchange Release | 11 February 2020

Harvia Plc, Financial statements bulletin, 11 February 2020 at 9.00 a.m. EET


This release is a summary of Harvia Plc’s Financial statements bulletin 2019. The complete report is attached to this release as a pdf-file. It is also available on Harvia’s website at www.harvia.fi.  

Highlights of the review period

October-December 2019:

  • Revenue grew by 27.8% to EUR 20.7 million (16.2). At comparable exchange rates, revenue grew by 27.0% to EUR 20.6 million (16.5).
  • Adjusted operating profit was EUR 4.2 million (2.9), making up 20.1% (17.6) of the revenue. At comparable exchange rates, the adjusted operating profit grew to EUR 4.0 million (19.6% of the revenue).
  • Operative free cash flow amounted to EUR 7.0 million (5.1).

January-December 2019:

  • Revenue grew by 19.6% to EUR 74.1 million (61.9). At comparable exchange rates, revenue grew by 19.0% to EUR 73.7 million.
  • Adjusted operating profit was EUR 13.9 million (10.9), making up 18.7% (17.5) of the revenue. At comparable exchange rates, the adjusted operating profit grew to EUR 13.3 million (18.0% of the revenue).
  • Operative free cash flow amounted to EUR 15.2 million (10.0).
  • Net debt amounted to EUR 28.3 million (30.3) and leverage was 1.7 (2.3).
  • Equity ratio was 56.6% (56.3) at the end of the review period.
  • The Board of Directors’ dividend proposal EUR 0.38 per share, to be paid in two instalments.

Key figures

EUR million10-12/201910-12/2018Change, %1-12/20191-12/2018Change, %
EBITDA *4.73.341.8%16.511.542.5%
% of revenue22.7%20.5% 22.2%18.6% 
Items affecting comparability **0.20.1147.9%0.61.5-62.6%
Adjusted EBITDA ***5.03.444.9%
% revenue23.9%21.1% 22.9%21.0% 
Operating profit3.92.842.3%13.39.442.1%
% revenue18.9%17.0% 18.0%15.1% 
Adjusted operating profit ***4.22.946.0%13.910.927.9%
% revenue20.1%17.6% 18.7%17.5% 
Basic EPS (EUR)****0.160.1149.9%0.510.4126.3%
Operating free cash flow7.05.138.7%
Cash conversion141.9%148.2% 89.3%77.0% 
Investments in tangible and intangible assets-0.4-0.4-10.4%-1.8-1.611.8%
Net debt *28.330.3-6.5%28.330.3-6.5%
Leverage1.72.3 1.72.3 
Net working capital16.817.5-3.8%16.817.5-3.8%
Adjusted return on capital employed (ROCE)38.2%31.6% 38.2%31.6% 
Equity ratio56.6%56.3% 56.6%56.3% 
Personnel at the end of period395400-1.3%395400-1.3%

* Adoption of IFRS 16 Leases standard increased EBITDA by EUR + 580 thousand and net debt by EUR 2.7 million at the end of December 2019.

** Consists of items outside the ordinary course of business that are related to Group's strategic development projects, the listing, acquisitions, loss on sale of fixed assets and affect comparability.

*** Adjusted by items affecting comparability.

**** Earnings per share (EPS) in January–December 2018 were EUR 0.36, calculated based on the number of shares after the listing.

Financial targets and outlook

Harvia does not publish its short-term outlook. However, the company has set long-term targets related to growth, profitability and leverage. The company targets an average annual revenue growth of more than 5%, adjusted operating profit margin of 20% and a net debt/adjusted EBITDA between 1.5x−2.5x. The future impacts of changes in IFRS reporting standards have been excluded in the net debt/adjusted EBITDA ratio target.

Harvia targets a regularly increasing dividend with a bi-annual dividend payout of at least 60 percent of net income, in total.

Tapio Pajuharju, CEO:

Harvia’s growth during 2019 was strong in all product groups and in almost all our key markets. We achieved a revenue of EUR 74.1 million, growing 19.6 percent year on year. Growth was especially strong during the final quarter, and revenue increased to EUR 20.7 million, growing 27.8 percent year on year.

Our journey into a comprehensive one-stop shop operator in the sauna and spa market is proceeding as planned. During the financial period, revenue growth was especially strong in Finland, other Scandinavian countries, North America and other markets, such as France, Switzerland, the UK, Benelux countries, Poland and Arab countries. The sales of all our product groups increased, but growth in the sauna rooms product group was especially accelerated by the North American and Central European markets. The sauna rooms product group experienced an excellent 124 percent growth. In addition to sauna rooms, the sauna heater product group experienced strong growth both in professional and consumer channels, resulting in 18.2 percent growth in the final quarter. The demand in steam generators was also favorable, and the product group grew by 31.6 percent year on year.

Harvia’s personnel has done an excellent work, together with our key customers and partners. I have all the reasons to be especially pleased with the outcome, where we have, on top of the strong growth, been able to improve the profitability of our business. In 2019, the adjusted operating profit amounted to EUR 13.9 million (10.9). The adjusted operating profit for the fourth quarter increased by 46.0 percent year on year, amounting to EUR 4.2 million (2.9). Our relative profitability has also had a positive trend.

Demand in the domestic market remained steady, and we have been able to strengthen our position both in professional and consumer markets. Our recently launched new products and solutions have enjoyed a positive reception in the market. In other Scandinavian countries, we have succeeded in improving the quality and amount of our distribution together with our partners. This is well reflected in our increasing sales. The Central European market developed as planned, even though the German market has not yet reached its fully normal growth rate. The performance in the German market is also partially reflected in control unit sales. The Russian market remained relatively stable, but the volatility of the market continued throughout the year. Demand in the US market accelerated towards the end of the year in sauna heaters, components and especially in the sauna rooms category. In the sauna rooms market we have updated and complemented our Almost Heave Saunas product offering and further expanded our distribution.

During 2019, the continuous improvement of productivity proceeded as planned in all our factories. The continuous improvement of productivity has succeeded especially well in our sauna heater and equipment factory in Muurame, Finland as well as in our Guangzhou factory in China. The integration of the business operations in the US has proceeded ahead of plans, and we have taken measures at the Renick factory to further improve productivity. 

The year 2019 is an excellent example of how determined and systematic cooperation with our key customers, strategic partners and Harvia’s truly professional team works. Together we have further developed the sauna and spa market and at the same token we are more than well prepared to take it to the next level during the coming years with our new innovations and concepts that create added value, enhance well-being and truly support the global growth of the sauna and spa market. Sustainable development has for a long time been part of Harvia’s daily operations. Our safe and durable products are manufactured sustainably. During the past year, we have taken steps to further enhance sustainable development. For example, we have prioritized recycling in our raw materials and other materials. Our key partner’s stainless steel, with over 80% recycled material, serves as an example. We have also used recycled fiber as a replacement for plastic and paid more attention to the efficiency and purity of burning, of which we will tell more about during the coming spring. We remain humble but keep our determined focus on the cornerstones of our strategy and its systematic implementation: increasing the value of the average purchase, geographical expansion and continuous improvement of productivity.  In addition to organic growth, we are actively looking into suitable opportunities to grow in the sauna and spa market through business acquisitions.  

Press conference

Harvia will hold a press conference in English for analysts, investors and media on Tuesday, February 11, 2020 at 11:00 a.m. Finnish time. The press conference is held at Allas Sea Pool, Smart & Clean Showroom (address: Katajanokanlaituri 2a, Helsinki, Finland). CEO Tapio Pajuharju and CFO Ari Vesterinen will host the event.

A live webcast of the conference is available at: https://harvia.videosync.fi/2019-q4-results/register.

A recording of the webcast will be available on Harvia’s website after the event.

For further information, please contact:
CEO Tapio Pajuharju, tapio.pajuharju@harvia.fi, tel. +358 50 577 4200
CFO Ari Vesterinen, ari.vesterinen@harvia.fitel. +358 40 505 0440


Harvia is one of the leading companies operating in the sauna and spa market globally, as measured by revenue. Harvia's brands and product portfolio are well-known in the market and the company's comprehensive product portfolio strives to meet the needs of the international sauna and spa market of both private and professional customers.

Harvia's revenue totaled EUR 74.1 million in 2019, its operating profit was EUR 13.3 million and adjusted operating profit EUR 13.9 million during the same period. The company employs some 400 professionals in Finland, China and Hong Kong, Romania, Austria, United States, Germany and Estonia. The company is headquartered in Muurame, Finland, adjacent to its largest sauna and sauna component manufacturing facility.

Read more www.harvia.fi