Verkkokauppa.com Oyj: Due to the Group structure, Verkkokauppa.com reports the parent company separately in accordance with Finnish Accounting Standards (FAS) – The Group is reported in accordance with IFRS

Due to the Group structure, Verkkokauppa.com reports the parent company separately in accordance with Finnish Accounting Standards (FAS) – The Group is reported in accordance with IFRS

Verkkokauppa.com Oyj Stock Exchange Release    20 December 2022 at 8:30am EET

Due to the Group structure, Verkkokauppa.com will report the parent company separately, and in accordance with Finnish Accounting Standards (FAS). Verkkokauppa.com has formed a Group since completing an acquisition on 1 April 2022.

The change does not affect the Verkkokauppa.com Group’s reporting. The Group reports its year-end financial statements bulletin and financial statements for the financial period ending on 31 December 2022 in accordance with (IFRS), and for the first time, the parent company reports separately in accordance with FAS.

Attached to this release are the unaudited interim bridge calculations according to FAS from the parent company’s income statement and balance sheet for the full year of 2021.

Verkkokauppa.com will publish its Financial Statements Bulletin for 2022 on 9 February 2023.

For more information, please contact:

Mikko Forsell
CFO, Verkkokauppa.com Oyj
mikko.forsell@verkkokauppa.com
Tel. +358 10 309 5555

Marja Mäkinen
Head of Investor Relations and Corporate Communications
Verkkokauppa.com Oyj
Marja.makinen@verkkokauppa.com
Tel. +358 40 671 2999

Attachments:
The unaudited interim bridge calculations in accordance with FAS from the parent company of Verkkokauppa.com’s income statement and balance sheet for the full year of 2021.

	IFRS 31 December 2021		FAS adjustments requirement	FAS 31 December 2021
Revenue	574 513 965			574 513 965
Other operating income	921 848			921 848
Materials and services	-483 322 953	3b)	59 749	-483 263 203
Employee benefit expenses	-36 570 478	1b)	1 538 289	-35 032 189
Depreciation and amortization	-4 983 439	2)	3 649 630	-1 333 809
Other operating expenses	-30 263 077	1b), 2)	-6 572 454	-36 835 531
Operating profit	20 295 867		-1 324 786	18 971 081
Finance income	5 629			5 629
Finance costs	-1 352 447	2)	1 197 715	-154 732
Net financial costs	-1 346 818		1 197 715	-149 102
Profit before income taxes	18 949 049		-127 071	18 821 978
Taxes in the accounting period	-3 795 968			-3 795 968
Taxes from current accounting periods	261			261
Income taxes	-60 205	5)	60 205	0
Income taxes total	-3 855 912		60 205	-3 795 706
Profit for the period	15 093 138		-66 866	15 026 272

	IFRS balance on 31 December 2021		FAS adjustments requirement	FAS balance on 31 December 2021
Intangible assets
Property, plant and equipment	1 363 597			1 363 597
Right-of-use assets	5 214 014			5 214 014
Equity investments	15 776 459	2)	-15 776 459	0
Deferred tax assets	266 484	3a)	-265	266 219
Trade receivables	1 289 163	5)	-1 289 163	0
Loan receivables	3 816 537			3 816 537
Receivables from companies of the same group, short-term
Other non-current receivables	424 764			424 764
Non-current assets, total	28 151 019		-17 065 887	11 085 132
Current assets
Inventories	87 802 963	3b)	509 341	88 312 304
Trade receivables	23 123 801			23 123 801
Receivables from companies of the same group, long-term
Loans receivable
Other receivables	3 699 415			3 699 415
Income tax receivables
Accrued income	8 627 205			8 627 205
Cash and cash equivalents	20 917 082			20 917 082
Current assets, total	144 170 466		509 341	144 679 807
Total assets	172 321 485		-16 556 546	155 764 939
Equity
Share capital	100 000		0	100 000
Treasury shares	-1 610 616	1c)	11 173	-1 599 443
Invested unrestricted equity fund	25 937 990		0	25 937 990
Retained earnings	-3 837 936	1), 2), 3), 4), 5)	3 114 194	-723 742
Profit for the period	15 093 138	1), 2), 3), 4), 5)	-66 866	15 026 272
Total equity	35 682 576		3 058 501	38 741 077
Non-current liabilities
Lease liabilities	16 104 849	2)	-16 104 849	0
Liabilities to credit institutions
Deferred tax liabilities
Liabilities to companies of the same group, long-term
Provisions	895 743			895 743
Non-current liabilities, total	17 000 591		-16 104 849	895 743
Current liabilities
Lease liabilities	4 034 477	2)	-4 034 477	0
Liabilities to credit institutions
Advance payments received	5 760 991			5 760 991
Trade payables	77 609 210			77 609 210
Liabilities to companies of the same group, short-term
Other current liabilities	10 717 909	1a)	-756 967	9 960 942
Accrued liabilities	19 777 727	1a), 2), 4)	1 281 246	21 058 973
Income tax liabilities	1 738 004		0	1 738 004
Current liabilities, total	119 638 319		-3 510 198	116 128 120
Total liabilities	136 638 910		-19 615 047	117 023 863
Total equity and liabilities	172 321 485		-16 556 546	155 764 939

FAS notes

Outlined below are the accounting policies that have had the most significant effects on the income statement, and statement of financial position statement of Verkkokauppa.com Oyj due to the adoption of FAS.

1. Changes in classification

a) Classification changes related to the balance sheet.

b) Voluntary personnel costs

The company has presented in the IFRS financial statements that all personnel expenses included in employee benefits are presented as part of personnel expenses.

In FAS, all voluntary personnel expenses are included in other business expenses.

c) Own shares

In previous years, the company has recorded transaction costs resulting from the acquisition cost of its own shares in equity as part of the IFRS acquisition cost of the shares.

In FAS, the acquisition costs of the company's own shares are treated as expenses in the income statement.

2. Leases

The company is, according to IFRS, the company must record in the balance sheet of all lease agreements the equivalent of the present value of the minimum rents at the beginning of the lease agreement asset and liability. The standard includes a practical aid for recording, according to which low-value and short-term (less than 12 months) leases may not be recorded. Verkkokauppa.com Corporation has decided to apply both means of assistance. Asset and liability based on leasehold the amount is calculated by discounting future minimum rents. With the processing according to IFRS The rental expense shown in the FAS is compensated by depreciation of the asset. In addition, it is recorded the interest expenses of the lease debt, which are presented in the financial expenses of the income statement. As far as lease agreement payments have been allocated to accrued liabilities, they have been transferred as part of the lease agreement debt.

In FAS, the income statement records the costs of leases according to the passage of time to other business expenses. At the end of the accounting period, the rental obligations are reported on the balance sheet as external items as part of liability commitments.

3. Financial instruments

a) Classification of equity investments at fair value through other comprehensive income

IFRS requires the classification of financial assets based on the business model. The company is IFRS evaluated the business model of equity investments and made an irrevocable decision classify the equity investments in question at fair value through other comprehensive income. In FAS, the company treats investments initially at acquisition cost.

According to IFRS, changes in the fair value of investments are recorded in other comprehensive income. Equity in connection with the transfer of conditional investments, related to accumulated other items of comprehensive income the included balance is transferred to retained earnings.

b) Annual credits for inventory

In accordance with IFRS, when determining the purchase costs of inventory, it is minus annual credits. In accordance with FAS, not all annual credits have been allocated to the acquisition cost of the inventory.

In this regard, the company must adjust the book value of the warehouse and the book adjusted deferred taxes. In the income statement, the effect is reflected in the materials and services item, in the change of current assets and as a change in deferred taxes.

4. Other adjustments

In 2021, Verkkokauppa.com had two share-based incentive plans for the CEO and members of the Management Team, the Matching Share Plan 2018–2020 and the Performance Matching Share Plan 2020–2022.

In 2021, Verkkokauppa.com handed over the rewards according to the first commitment period of the Additional Share Program 2018–2020 in a directed free share issue.

Share-based incentive plans has been classified in the IFRS reporting as an equity-settled transaction, because Verkkokauppa.com Oyj will deduct, on behalf of the employee, from the share award such number of shares which covers taxes and tax-like charges paid in cash.

This equity-settled shared-based payment was measured at grant date fair value and recognized as an expense and in retained earnings during its validity period.

In FAS, the share-based payment is recognized as an expense and accrued liabilities.

5. Deferred tax assets and liabilities

The company has recorded an IFRS deferred tax asset related to lease agreements and inventory for correction. The company will not record deferred taxes for these items in the FAS financial statements.

Distribution:
Nasdaq Helsinki
Main media
www.verkkokauppa.com

Verkkokauppa.com empowers its customers to follow their passion by providing a wide product assortment of around 90,000 products. Verkkokauppa.com Oyj serves its retail and corporate customers through its webstore, megastores, kiosk and network of collection points as well as fast deliveries and various services. As Finland’s most popular and most visited domestic online retailer, its deliveries cover around 75 percent of the Finnish population within the next day. The Company has four megastores: in Oulu, Pirkkala, Raisio, and Helsinki, where its headquarters is also located. Verkkokauppa.com employs more than 750 people and its shares are listed on the Nasdaq Helsinki stock exchange with the ticker VERK.

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