Sievi Capital Plc’s Business Review for January–March 2023 - Seite 2

For Indoor Group, the beginning of the year was mixed. Sales did not yet return to the usual level, but the company, nevertheless, managed to improve its profits from the comparison period. Nordic Rescue Group’s performance improved after ceasing the loss-making rescue lift business. The company is now focusing on the business operations of Saurus and Sala Brand.

Sievi Capital’s result for the first quarter showed a loss due to unrealised changes in values, particularly as a result of the negative change in the value of the Indoor Group investment. Over the past year, there has been no realised income from the target companies, as a result of which the return on equity for the rolling 12 months remained negative and was -9.5% at the end of the review period.

Sievi Capital’s organisation will be strengthened in August with Lauri Veijalainen starting as the company’s permanent CEO. Lauri is well-placed to support the target companies in their development and lead Sievi Capital in its transformational journey towards being an industrial group.”

Future outlook

As a result of the change in strategy announced on 15 December 2022, Sievi Capital will transform from a private equity investment company into a conglomerate during 2023. Sievi Capital’s strategy will no longer include making private equity investments in new industries. The medium-term objective is to become an industrial group built around the KH-Koneet Group’s business and to divest other target companies in line with previous strategy. For Sievi Capital’s other investments, the active development of the companies’ business operations will continue. Exit planning for the other investments will also continue.

Sievi Capital does not consolidate the figures of its subsidiaries into Group-level calculations line item by line item. Instead, investments in the companies are recognised at fair value through profit or loss. Changes in the fair values of the investments have a material impact on Sievi Capital’s results. In addition to the target companies’ own development, factors that influence the development of the fair values of the investments include, for instance, the general development of different sectors and national economies as well as changes in their outlooks, the development of stock market and interest rates and other factors beyond Sievi Capital’s control. The coronavirus pandemic and impacts of the war in Ukraine also increase uncertainty in projections of future development.