TRAINERS’ HOUSE GROUP, STOCK EXCHANGE RELEASE, 18 JULY 2024 at 8:30
January-June 2024 in brief
net sales EUR 4.3 million (EUR 4.9 million), change of -12.4 % compared to the corresponding period of the previous yearoperating result EUR 0.2 million (EUR 0.2 million), 5.0 % of net sales (3.5 %)cash flow from operations EUR 0.5 million (EUR 0.3 million)earnings per share EUR 0.10 (EUR 0.08)
April-June 2024 in brief
net sales EUR 2.1 million (EUR 2.2 million), change of -4.9 % compared to the corresponding period of the previous yearoperating result EUR 0.0 million (EUR -0.2 million), 2.3 % of net sales (-10.5 %)cash flow from operations EUR 0.3 million (EUR 0.0 million)earnings per share EUR 0.02 (EUR -0.11)
Key figures at the end of second quarter of 2024
cash and cash equivalents EUR 1.5 million (EUR 1.8 million)interest-bearing liabilities of EUR 0.8 million (EUR 0.3 million) and interest-bearing net debt of EUR -0.8 million (EUR -1.5 million).equity ratio 63.2 % (64.1 %)
OUTLOOK FOR 2024
The company estimates the operating profit for 2024 to be negative.
CEO ARTO HEIMONEN
Trainers’ House was profitable in the first half of the year.
Market conditions remained challenging. However, in June, customer acquisition was successful and better than last year. Cash and cash equivalents continued to strengthen during the second quarter.
Customer satisfaction has remained at a high level. The Net Promoter Score (NPS) given by customers is 80, which is world class (235 responses in the first half of the year). Taking care of customers’ concerns and legendary customer intimacy are the cornerstones of Trainers’ House.
Healthy cash flow and profitability are the company’s most important business goals in 2024 as well.
The purpose of Trainers’ House is to help people forward. This is possible by touching people, electrifying management and producing verifiable results.
Thanks to customers, employees, and partners.
More information:
Arto Heimonen, CEO, +358 404 123 456
Saku Keskitalo, CFO, +358 404 111 111
OPERATIONAL REVIEW
During the review period, the company focused on serving its customers.
In the first half of the year, the company hired over 100 early-career employees in the year-long Trainers’ House Growth Academy.
FINANCIAL PERFORMANCE
Net sales for the reporting period were EUR 4.3 million (EUR 4.9 million). Operating result was EUR 0.2 million, 5.0 % of net sales (EUR 0.2 million, 3.5 %). The result for the period was EUR 0.2 million, 5.1 % of net sales (EUR 0.2 million, 3.6 %).
The breakdown of the Group’s figures (unit thousand euros) is presented in the following table:
Group’s main figures (kEUR)1-6/20241-6/2023Net sales4 3284 943Expenses: Expenses arising from employee benefits-2 852-3 251Other expenses-1 080-1 251EBITDA397441Depreciation and impairment losses-182-266EBIT 215175EBIT, % of net sales5.03.5 Financial income and expenses-92Result before taxes206177Income taxes172Result of the period223179Result, % of net sales5.13.6
LONG-TERM OBJECTIVES
The company’s long-term goal is profitable growth.
FINANCING, INVESTMENTS AND SOLVENCY
Cash flow and key financing figures (unit million euros)1-6/20241-6/2023Cash flow from operations before financial items0.50.3Cash flow from operations0.50.3Cash flow from investments0.00.0Cash flow from financing-0.1-0.8Total cash flow0.4-0.5 6/20246/2023Cash1.51.8Interest-bearing debt0.80.3Equity ratio %63.264.1
MAJOR RISKS AND UNCERTAINTIES
Trainers’ House’s business is sensitive to economic fluctuations.
The general economic situation internationally and in Finland contains significant risks. The war in Europe, the tense world political situation and the possible expansion of the crisis can cause rapid changes in the operating environment.
Possible world trade restrictions and changes in the world political situation affect the exports of Finnish companies, which is reflected in the demand of the domestic market. The demand in domestic market could diminish due to public cost-cuttings and tax increases. The change in domestic market demand directly affects Trainers’ House’s business.
Compared to the level of the last decade, the high interest rate has a negative effect on economic activity. Inflation can also accelerate due to, for example, escalation of world political crises.
The constant competition for the best employees affects recruitment and the commitment of key personnel. From the company’s point of view, the labor market situation has eased over the past year.
The above-mentioned risks, when realized alone or together, have a significant impact on the company’s operations.
The company divides the risk factors affecting business, earnings, and market capitalization into five main categories: market and business risks, personnel-related risks, technology and information security risks, financial risks, and legal risks.
Trainers’ House has sought to hedge against the adverse effects of other risks with comprehensive insurance policies. These include statutory insurance, liability and property insurance and legal expenses insurance. Insurance coverage, insurance values and deductibles are reviewed annually together with the insurance company.
The Management Team reports to the Board on a monthly basis on key business-related risks and, where necessary, risk management measures.
The Group has the reporting systems required for effective business monitoring. Internal control is linked to the company’s vision, strategic goals and the business goals set on the basis of them.
The realization of business objectives and the Group’s financial development are monitored on a monthly basis through the Group’s corporate governance system. As an essential part of the control system, actual data and up-to-date forecasts are reviewed monthly by the Group Management Team. The control system includes, among other things, sales reporting, an income statement, a rolling revenue and profit forecast, and key figures that are important to operations.
Trainers’ House is an expert organization. The magnitude of market and business risks is difficult to determine. Typical risks in this area are related to, for example, general economic development, customer distribution, technology choices, the development of competition and the management of personnel costs.
Risks are managed through the planning and regular monitoring of sales, human resources, and operating expenses, which enables rapid action when circumstances change. The risks of trade receivables have been taken into account by the recognition of expenses based on the age of the receivables and individual risk analyzes.
The goal of Trainers’ House’s financial risk management is to secure the availability of equity and debt financing on competitive terms and to reduce the impact of adverse market movements on the company’s operations.
Financial risks are divided into four categories, which are liquidity, interest rate risks, currency risks and credit risks. Each risk is monitored separately. Liquidity and interest rate risks are reduced with sufficient cash resources and efficient collection of receivables. Currency risks are low as Trainers’ House operates primarily in the euro market. In financial risk management, the focus is on liquidity.
The success of Trainers’ House as an expert organization depends on its ability to attract and retain skilled staff. In addition to a competitive salary, personnel risks are managed through incentive schemes and investments in personnel training, career opportunities and general well-being.
Technology is a key part of Trainers’ House’s business. Technology risks include, but are not limited to, supplier risk, risks related to internal systems, challenges posed by technological change, and security risks. Risks are protected against long-term cooperation with technology suppliers, appropriate security systems, staff training and regular security audits.
Trainers’ House’s legal risks are mainly focused on the contractual relationship between the company and customers or service providers. At their most typical, they relate to delivery responsibility and the management of intellectual property rights. In order to manage the risks related to contracts and intellectual property rights, the company has internal guidelines for contractual procedures. In the company’s view, the contractual risks are not unusual.
At the end of the review period, goodwill and other intangible assets recognized in the balance sheet have been tested in the normal way. The test did not reveal any need for impairment.
The consolidated balance sheet of Trainers’ House has goodwill of EUR 2.1 million. The balance sheet value of other intangible assets is EUR 1.0 million. If the Group’s profitability does not develop as forecasted or other external factors independent of the Group’s operations, such as interest rates, change significantly, it is possible that goodwill and other intangible assets will have to be written off. Recognition of an impairment loss would have no effect on the Group’s cash flow.
Due to the project nature of the operations, the order backlog is short, and predictability is therefore challenging.
The description of potential risks is not comprehensive. Trainers’ House conducts continuous risk assessment in connection with its operations and strives to hedge against identified risks.
Investors have also been informed about the risks in the company’s annual review and on the website at www.trainershouse.fi.
PERSONNEL
At the end of the review period, the Group had 113 (118) employees. As before, the company reports the number of employees converted to full-time employees.
DECISIONS REACHED AT THE ANNUAL GENERAL MEETING
The annual general meeting of Trainers’ House Plc was held on 27 March 2024 in Helsinki.
The annual general meeting confirmed the financial statements and discharged CEO and the members of the Board of Directors from liability for the fiscal year 1 January – 31 December 2023. The annual general meeting also decided to adopt the remuneration policy of the governing bodies.
The annual general meeting decided, in accordance with the board’s proposal, that the company does not distribute a dividend from 2023.
Aarne Aktan, Jari Sarasvuo, Jarmo Hyökyvaara, Elma Palsila and Emilia Tauriainen were re-elected as members of the Board of Directors. In the board meeting held after the annual general meeting, the Board of Directors elected Jari Sarasvuo as the chairperson of the board.
The annual general meeting decided that the board member’s remuneration shall be EUR 1,500 per month and the chairperson’s remuneration will be EUR 3,500 per month.
Grant Thornton Oy was elected as the company’s auditor. The remuneration to the auditor is paid according to the auditor’s reasonable invoice.
SHARES AND SHARE CAPITAL
The company’s share is listed on Nasdaq Helsinki Ltd under the name Trainers’ House Plc (TRH1V).
At the end of the reporting period, Trainers’ House Plc had 2,147,826 shares and a registered share capital of EUR 880,743.59. The company does not hold any of its own shares. There have been no changes in the share capital during the period.
Share performance and trading
1-6/20241-6/2023Traded shares, pcs143 267149 304Average number of all company shares, %6.77.0Traded shares, EUR435 583771 581Highest share quotation4.886.12Lowest share quotation2.073.96Closing price2.24 4.20Weighted average price3.045.17Market capitalization4.8 mil.9.0 mil.
SUMMARY OF FINANCIAL STATEMENTS AND NOTES
The report has been prepared in accordance with IAS 34 standard. The report has been prepared in accordance with IFRS standards and interpretations that have been approved for application in the EU and are in force on 1 January 2024.
In this interim report Trainers’ House has followed the same accounting policies and calculation methods as in the 2023 annual financial statements.
The figures given in the interim report are unaudited.
INCOME STATEMENT IFRS (kEUR)1-6/20241-6/20231-12/2023NET SALES4 3284 9438 437Expenses: Materials and services-187-222-391Personnel-related expenses-2 852-3 251-5 691Depreciation and impairment losses-182-266-531Other operating expenses-893-1 029-1 925Total expenses-4 114-4 768-8 538Operating result215175-101Financial income and expenses-926Result before taxes206177-95Income taxes1724RESULT OF THE PERIOD223179-91Result attributable to owners of the parent company223179-91Earnings per share, EUR0.100.08-0.04Earnings per share attributable to owners of the parent company, EUR0.100.08-0.04
BALANCE SHEET IFRS (kEUR)6/20246/202312/2023ASSETS Non-current assets Tangible assets780510961Goodwill2 1292 1292 129Other intangible assets1 0131 0461 013Long-term receivables Other receivables, long-term122155138Deferred tax receivables219205202Total long-term receivables341360341Total non-current assets4 2634 0454 443 Current assets Account receivables and other receivables898870783Cash and cash equivalents1 5331 7871 175Total current assets2 4312 6571 958TOTAL ASSETS6 6946 7026 401 SHAREHOLDERS’ EQUITY AND LIABILITIES Equity attributable to the owners of the parent company Share capital881881881Distributable non-restricted equity fund373737Retained earnings3 0213 1113 111Result of the period223179-91Total shareholders’ equity4 1614 2093 939Long-term liabilities Deferred tax liabilities203208203Long-term financial liabilities49138631Total long-term liabilities693246833Short-term liabilities Short-term financial liabilities277291197Accounts payable and other liabilities1 5621 9561 432Total short-term liabilities1 8402 2471 629Total liabilities2 5332 4932 462TOTAL SHAREHOLDERS’ EQUITY AND LIABILITIES6 6946 7026 401
CASH FLOW STATEMENT IFRS (kEUR)1-6/20241-6/20231-12/2023CASH FLOW FROM OPERATIONS Result of the period223179-91Adjustments 174314570Changes in working capital97-193-257Cash flow from operations before financial items and taxes494300222Financial items and taxes paid-13-13-16CASH FLOW FROM OPERATIONS481287206CASH FLOW FROM INVESTMENTS Investments in tangible and intangible assets-25-12Repayment of loan receivables17 2642Interests received51521CASH FLOW FROM INVESTMENTS194651CASH FLOW FROM FINANCING Repayment of lease liabilities-60-197-363Dividends paid-82-597-966CASH FLOW FROM FINANCING-142-793-1 329TOTAL CASH FLOW358-460-1 072CHANGE IN CASH AND CASH EQUIVALENTS Opening balance of cash and cash equivalents1 1752 2472 247Closing balance of cash and cash equivalents1 5331 7871 175CHANGE IN CASH AND CASH EQUIVALENTS358-460-1 072
CHANGE IN SHAREHOLDERS’ EQUITY (kEUR)
Equity attributable to owners of the parent company
CHANGE IN SHAREHOLDERS’ EQUITY (kEUR)Share capitalDistributable non-restricted equity fundRetained earningsTotalEquity 1 January 2023881374 1215 039Other comprehensive income 179179Dividends -1 009-1 009Equity 30 June 2023881373 2914 209 Equity 1 January 2024881373 0213 939Other comprehensive income 223223Dividends Equity 30 June 2024881373 2434 161
RELATED PARTY TRANSACTIONS
During the period under review, Trainers’ House had transactions with Causa Prima Ltd, a company controlled by Jari Sarasvuo, the Chairperson of the Board of Directors, and Pro Vividus Ltd and Anorin Liekki Ltd, which are related to the company.
The following transactions took place with related parties:
RELATED PARTY TRANSACTIONS (kEUR)1-6/20241-6/20231-12/2023Purchases during the period188105168Liabilities at the end of the period575239
PERSONNEL1-6/20241-6/20231-12/2023Average number of personnel115125113Personnel at the end of the period11311896
COMMITMENTS AND CONTINGENT LIABILITIES6/20246/202312/2023Collaterals and contingent liabilities given for own commitments (kEUR)120139120
OTHER KEY FIGURES6/20246/202312/2023Equity ratio (%)63.264.163.5Shareholders’ equity/share (EUR)1.941.961.83
Calculation formulas for key figures
Earnings per share = Result of the period attributable to owners of the parent company
Average number of shares
adjusted for share issue in financial period
Interest-bearing net debt = Interest-bearing liabilities – cash and cash equivalents
Equity ratio (%) = Equity x 100
Balance sheet total – advances received
Equity / share = Equity
Number of shares adjusted for share issue at the
end of financial period
Items affecting the calculation of key figures6/20246/202312/2023Advances received (kEUR)112133198Interest-bearing liabilities (kEUR)768329828Average number of shares adjusted for share issue in financial period (unit thousand shares)2 1482 1482 148Number of shares adjusted for share issue at the end of the financial period (unit thousand shares)2 1482 148
2 148
In Helsinki 18 July 2024
TRAINERS’ HOUSE PLC
BOARD OF DIRECTORS
Information:
Arto Heimonen, CEO, +358 404 123 456
Saku Keskitalo, CFO, +358 404 111 111
DISTRIBUTION
Nasdaq Helsinki
Main media
www.trainershouse.fi – For investors
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