The Russian invasion of Ukraine has impacted Harvia directly and indirectly. The direct impact is on Russia, Ukraine and the related markets. The indirect impact is visible in the higher raw material prices, inflation and reduced consumer confidence. This has lowered the demand for entry level saunas and sauna heaters in Central Europe. Sauna sales remained stable for premium products as well as for sauna heaters and components suited for professional customers. The advanced demand we experienced in the past due to the COVID-19-related home improvement boom has faded away.
In the second quarter of 2022, Harvia’s revenue and profitability decreased compared to the record high second quarter of 2021. On top of the Russia impact, the main reason for the unfavorable development is declining sales in Central Europe. The sales mix was substantially skewed towards lower profitability products groups. Slower rotation of Russian related trade receivables resulted in increased provisions for possible future write downs of the trade receivables in Russia.
Simultaneously, the awareness, popularity and usage of saunas has increased in multiple markets. Harvia’s management estimates that the company has continued to increase its market share in all markets, and the demand for the company’s products remains solid, especially for the premium professional offering. While the period of advanced demand appears to have ended, the penetration of sauna and spa products continues to increase. In addition, the demand for replacement products is expected to remain stable. The company’s management estimates that the current market situation will not affect the long-term growth expectations of the sauna and spa market or Harvia’s long-term targets.
Harvia will publish its half-year financial report on 11 August 2022. Due to the silent period, Harvia will not give any further comments on its result before publishing the half year report. Harvia will hold a webcast conference on the day of the results release. The participants have the opportunity to ask questions during that webcast.