Report of the Board of Directors for the financial year 2016

  • Net sales were EUR 1 872.9 (1 917.1) million
  • EBIT was EUR 9.7 (9.6) million. Comparable EBIT was EUR 13.2 (21.5) million, and the corresponding EBIT margin was 0.7 (1.1) per cent. 
  • Cash flow before debt service was EUR 23.7 (32.2) million.
  • Comparable profit before taxes was EUR 4.4 (14.1) million.
  • EPS was EUR -0.10 (0.01).
  • Net financial expenses were EUR -8.7 (-9.1) million. 
  • Net debt was EUR 137.2 (144.0) million.
  • Outlook for 2017: HKScan aims to reach the comparable operating profit (EBIT) of the year 2016.
  • The Board’s proposal for dividend is EUR 0.16 (0.14) per share. 

Group overview

In 2016, the Group’s net sales decreased compared to 2015 and all the other market areas, except Finland, were behind the previous year. The Group’s comparable EBIT was lower than in the previous year. The biggest decline in EBIT was in market area Sweden, due to weak sales performance, especially in the processed category. Performance in Sweden was also impacted by the higher purchase prices and the scarcity of beef on the market. In Finland, full-year EBIT remained behind the previous year due to the weak first half of the year. EBIT in the Baltics showed a slight improvement. Market area Denmark made still loss, but it continued performing well on the domestic retail market, and challenges in exports continued.

Animal raw material prices in Finland and the Baltics were at a level slightly below 2015. In Sweden, the prices of animal raw material, beef in particular, continued increasing. A shortage of beef continued in Sweden and also in Finland to some extent throughout the whole reporting period. An oversupply of pork posed challenges on the Finnish market. Thanks to successful actions to mitigate the pig oversupply in the Finnish meat value chain, pork inventories were successfully lowered towards the end of the year to a level below the previous year. Vegetarian and vegan food were discussed widely in 2016, but the overall level of meat consumption remained stable throughout the year.

The total market in Sweden and Denmark grew in value. In Finland, where the total market in value had declined throughout the first three quarters of the year, yet showed growth in the fourth quarter. The Baltic market declined in value. Fierce price competition continued on all markets, especially in retail. Despite the market decline in Finland and the Baltics, inventories were successfully kept in balance. In Denmark, the domestic market grew and HKScan increased its market share in value.

During 2016, Finland successfully maintained or increased its market share in value, depending on category. Away from home sales grew in Finland at a faster pace than the market in value, but in Sweden the growth rate was slower. In export, price levels improved from the previous year. HKScan opened a sales office in Hong Kong in January.

The Group’s investment in a new poultry production facility in Rauma, Finland, proceeded well in 2016. Related to the launch of the new production facility, HKScan initiated statutory negotiations at its Eura plant, Finland in December. The expansion investment of the Group’s Polish bacon plant was also making good headway.

In December, HKScan announced the results of its internal investigation into its Baltic business. The proven violations of Code of Conduct and the principles of good governance led to the termination of the managerial and employment contracts of four persons from the local management.


Net sales and EBIT by market area
(EUR million)
NET SALES 2016 2015
Sweden 804.4 841.9
Finland 806.5 801.6
Denmark 173.2 175.9
Baltics 161.3 173.6
Between segments -72.4 -76.0
Group total 1 872.9 1 917.1
Sweden 12.9 21.1
Finland 14.6 4.9
Denmark -9.5 -9.3
Baltics 6.4 5.4
Between segments - -
Segments total 24.4 22.1
-14.7 -12.5
Group administration costs
Group total 9.7 9.6

The division of segments is based on the Group’s organization and the reporting to the Board of Directors and Management. Management monitors the profitability of business operations by market area. The Group’s primary segments are geographical segments: Sweden, Finland, Denmark and the Baltics.


In Sweden, net sales were EUR 804.4 (841.9) million and comparable EBIT was EUR 14.5 (21.6) million.

Net sales in 2016 declined from 2015, mainly due to the shortage of beef raw material and declined sales of processed food, including cold cuts. In the fourth quarter, both net sales and comparable EBIT decreased.

A shortage of Swedish pork and beef during spring and summer resulted in increased animal raw material prices. As a result of that HKScan succeeded to increase sales prices. However, they did not fully compensate for higher raw material prices and sales volume decline on a full year basis. The amount of imported meat increased on the market and private label growth continued in all categories in Sweden. The total market grew in value, but HKScan lost some of its market share.

Consumer demand for food increased in general with a focus on organic products, as well as on health, wellbeing and vegetarian trends. HKScan responded to this by launching several Scan®-branded novelties containing both meat and vegetables. Sustainability related communications activities under the “Framtidens Kött” (Meat of the Future) concept were successfully undertaken according to targets.


In Finland, net sales were EUR 806.5 (801.6) million and comparable EBIT was EUR 14.8 (16.3) million.

Net sales increased slightly from 2015, but comparable EBIT decreased. Sales prices declined in Finland, but thanks to the improved product mix and volumes, the year-on-year increase seen in comparable EBIT in the third quarter continued also in the fourth quarter. HKScan successfully increased its market share towards the end of the year. Christmas season sales were better than in the previous year.

The total market grew in value in the fourth quarter after a long decline that began back in early 2015. The improved situation was supported by slowly strengthened consumer confidence. The convenience food and poultry categories in particular showed positive development, with both volume and value improving during the whole of 2016. Pork inventories were successfully lowered to a level below the previous year. Animal purchase prices in the fourth quarter were somewhat higher than in the previous quarters. For the whole year 2016, the prices were slightly below the level of 2015.

HK Maakarit® artisan sausages gained loyal consumers and new variants were launched under the concept. Also the launch of new bacon variants had a positive start, expanding the product range from classical products to new areas. In poultry, the Kariniemen KanaSet® products were the best-selling novelty during 2016.

The Group’s investment project in the new poultry production plant in Rauma proceeded according to schedule.


In Denmark, net sales were EUR 173.2 (175.9) million and comparable EBIT was EUR -9.1 (-9.3) million.

On the Danish market, overall consumer demand for poultry remained positive. The sales trend in fresh products was positive, leading to higher volumes, improved margins, and gained market shares.

The market situation in exports was fierce throughout the year, and Denmark’s performance in these markets was negatively affected both as regards price and volumes. Towards the year-end, its performance was further impacted by the closure of key Asian markets due to an outbreak of avian flu in Denmark during November.

HKScan’s investments in the Rose® brand have brought positive results, i.e. improved market share and brand awareness.


In the Baltics, net sales were EUR 161.3 (173.6) million and comparable EBIT was EUR 6.4 (5.4) million.

Net sales decreased in 2016, but comparable EBIT improved from the previous year throughout 2016. For January–December the change in the fair value of biological assets amounted to EUR 0.8 (0.0) million.

New trends in meat consumption negatively affected traditional processed meat categories such as sausages. In market area Baltics, sales prices and volumes declined, but primary production related costs as well as other costs decreased and compensated for the impact of declined net sales. 

For the Baltic business, 2016 marked a year of recovery after the negative impacts caused by African Swine Fever (ASF) from 2015 onwards. Disease-related risks prevailed, but actions to mitigate the spread to HKScan farms were managed successfully. The pork business started showing signs of recovery, and reduced zoning in November enabled HKScan to regain its previous sales and meat balance. Poultry consumption kept growing, but sales prices were very low. In the fourth quarter, the export business picked up thanks to a more favourable product mix and improved pork prices.

HKScan continued to harness the synergies of its brand and product portfolio between the Baltic markets. Strong branded sales were to a large extent a consequence of successful concept launches during the autumn. Particularly the new Rakvere® 50/50 meatballs, containing both meat and vegetables, and Tallegg® chicken product novelties were well received by consumers.


The Group’s net investments in 2016 came to EUR 97.6 (49.6) million. Their breakdown by market area was as follows:

(EUR million)
2016 2015
Sweden 19.8 13.7
Finland 64.0 19.9
Denmark 3.1 5.4
Baltics 10.8 10.6
Total 97.6 49.6


The Group’s interest-bearing debt at the year-end stood at EUR 144.1 (153.8) million. Net debt was EUR 137.2 (144.0) million and the net gearing ratio 33.5 (33.8) per cent.

The Group’s liquidity was good. Committed credit facilities at 31 December stood at EUR 100.0 (100.0) million, and were entirely undrawn. The EUR 200.0 million commercial paper programme had been drawn to the amount of EUR 7.0 (27.0) million.

Net financial expenses were EUR -2.2 (-2.2) million in the last quarter and EUR -8.7 (-9.1) million in 2016.

Research and development

Research and development in HKScan Group is targeted at developing new products and concepts and making improvements to products that are already on the market. A total of EUR 6.6 (5.1) million was spent on R&D in 2016, equal to 0.4 (0.3) per cent of net sales.

The development of common innovation platforms and processes continued in 2016, and synergistic cross-border opportunities received increased attention. Creating new growth areas is the Group’s key priority going forward.

HKScan is continuously building its R&D network in order to support the implementation of the Group strategy. During 2016, several new partnerships and joint projects were established with collaborators such as universities, research organizations, suppliers and other private organizations.

Corporate responsibility

HKScan has defined its priority areas in corporate responsibility as economic responsibility, social responsibility, animal welfare and the environment.

In 2016, HKScan carried out its second employee engagement survey. The results confirmed that the improvement actions taken on the basis of the previous survey (in 2014) have brought results in terms of better information flow and increased opportunities for involvement and taking initiative. Overall awareness of values and targets have strengthened. Towards the end of the year, new improvement plans were made, and the actions will be initiated during 2017. These include workplace/personnel safety improvements, which were in focus across the Group during 2016.

The construction of HKScan’s new poultry production facility in Rauma started in Finland. The plant is scheduled for completion at the end of 2017. From the very earliest stages of planning the project, special attention has been addressed to  securing animal welfare, biosecurity related to animal diseases, food safety and product quality, as well as employee wellbeing and safety aspects. The investment will also improve environmental efficiency overall, and enable utilization of side-streams for biotech products. Additionally, the new facility will have a significant direct and indirect employment impact.

In Finland, investment in the Outokumpu beef slaughterhouse and production facility marked a significant improvement in operational efficiency, ergonomics, environmental efficiency and animal welfare. Also the renewal of barn facilities at the Kristianstad slaughterhouse in Sweden brought improvements in animal welfare.

The Group worked in cooperation with animal behaviour experts, and all slaughterhouses were audited for animal welfare. The audits kicked off many improvements at the slaughterhouses premises, starting with improved conditions for the free movement of animals. Additionally, in Finland, training of the slaughterhouse personnel, drivers and producers was organized to enhance their understanding of natural cattle behaviour and to help them take this into account in their animal handling procedures.

The Group retained its good status regarding animal diseases both in its contract production and in its own primary production. In all HKScan countries, the use of antibiotics in the treatment of animals is significantly lower than in other European countries on average. Neither farms owned by HKScan nor its contract farmers use antibiotics preventively or to promote animal growth. In addition, the use of hormones as growth promoters is fully prohibited. Good animal care and control of animal diseases has led to good results in preventing outbreaks. Prevention of the spread of African Swine Fever (ASF) on pig farms was one of the main measures undertaken at HKScan farms in the Baltics. In Finland and Sweden, HKScan has also worked diligently to prevent the spread of the disease. A new animal disease threat that has emerged recently is high pathogenic avian flu (H5N8), which has been found in wild birds in countries in which the Group operates.

A clinical study undertaken by Helsinki University showed that Rypsiporsas® meat (rape seed pork) contains four times more polyunsaturated omega 3 fats than normal pork meat. Healthy lifestyles and responsibly produced, pure food are emerging trends also in Asia, which is the world’s largest pork market. HKScan answered to this trend by launching exports of Rypsiporsas® meat to Hong Kong.

HKScan is a member of the Round Table on Responsible Soy (RTRS) and the Roundtable on Sustainable Palm Oil (RSPO). The Group is committed to using only 100 per cent responsible soy in animal feed and as an ingredient by the end of 2018. In Sweden, this commitment was already fulfilled in 2015. HKScan finalized its survey of the Group’s palm oil usage in 2016. Palm oil is used only in very small amounts in the Group’s products and subcontracting. The target is to ensure that all palm oil used by HKScan is responsibly produced.  The Group is also looking into the option of using alternative vegetable oils instead of palm oil.

HKScan is making on ongoing effort to monitor and reduce the environmental impacts of its operations. These impacts are currently associated with energy efficiency and greenhouse gas emissions, wastewater, use of water, use of chemicals and treatment of waste. The Group launched an energy efficiency project in 2015, which continued in 2016 on multiple fronts. The target is to decrease the Group’s overall consumption of energy by 10 per cent from the 2014 level by 2017 (indexed to net sales). These efforts included an energy saving competition among personnel, which yielded over 1 000 energy-saving ideas.

HKScan operates in countries where responsible practices are widely embraced, automatically bringing us a number of valuable strengths in global comparison. These include high standards of hygiene, healthy animals, clean soil, as well as rich and clean water reserves. In 2016, HKScan participated in a number of cooperation projects and studies focusing on the environmental impacts of meat production and their mitigation.

Annual General Meeting and Board of Directors’ authorizations

The Annual General Meeting of HKScan Corporation was held on 13 April 2016 in Helsinki. The resolutions of the AGM, including authorizations given to the Board, are reported in full in a stock release the same day.

The AGM resolved that a dividend of EUR 0.14 be paid for 2015. All the Board members: Teija Andersen, Niels Borup, Tero Hemmilä, Mikko Nikula, Henrik Treschow and Pirjo Väliaho, as well as both deputy Board members: Per Nilsson and Marko Onnela were re-elected for a further term of office. At the organizational meeting, the Board re-elected Mikko Nikula as Chairman and Niels Borup as Vice Chairman. Tero Hemmilä resigned from the Company's Board on 11 May 2016.

PricewaterhouseCoopers Oy, an audit firm chartered by the Central Chamber of Commerce, with APA Jouko Malinen as the main auditor, was elected as the actual auditor until the close of the next Annual General Meeting.

In April 2016, the Board exercised the authorizations given by the AGM in conjunction to the directed share issue according to the Group’s share based incentive plan 2013, payment of the rewards for the performance period 2013–2015.

Changes in the senior management

On 27 May, HKScan announced that Jari Latvanen had been appointed as HKScan’s new President and CEO. He began in the position on 31 October 2016. His predecessor, Mr Hannu Kottonen, had left the company on 20 January 2016. During the interim period, Aki Laiho, deputy CEO and COO, assumed the position of CEO.

In June, Anders Jeppesen Jensen, General Manager at HKScan Denmark left the company and Göran Holm was named acting General Manager of HKScan Denmark on top of his duties as EVP Consumer Business, Scandinavia.

On 2 November, HKScan announced that Jyrki Karlsson had been appointed as the new Executive Vice President, Consumer Business, Finland and Baltics. Samuli Eskola, his predecessor, left the company on 1 November. 

On 2 November, HKScan announced that Anu Mankki had been appointed as the new EVP, HR. Her predecessor Sari Suono left the company in the end of September. Ms Mankki assumed her position on 2 January 2017.

Effective as of 19 December 2016, Anne Mere, Chief Marketing Officer (CMO) of HKScan, took over as the new EVP Consumer Business Baltics. She also retained her role as Group CMO. Consequently, Jyrki Karlsson was appointed as EVP responsible for Consumer Business Finland.

After the reporting period, on 8 February 2017, HKScan informed on renewing its Group Leadership Team.

Group Leadership Team

As of 8 February 2017, HKScan’s Group Leadership Team comprises the following members: Jari Latvanen, President and CEO; Sofia Hyléen Toresson, EVP Market Area Sweden (assuming her post on 2 May 2017); Jyrki Karlsson, EVP for Market Area Finland; Svend Schou Borch, EVP Market Area Denmark; Anne Mere, EVP Market Area Baltics; Jukka Nikkinen, EVP Market Area International & Biotech; Heli Arantola, EVP Categories and Concepts (assuming her post on 2 May 2017); Aki Laiho, EVP Operations; Anu Mankki, EVP HR; Tuomo Valkonen, CFO; and Markku Suvanto, EVP Legal.

Shares and shareholders


HKScan Group’s registered and fully paid-up share capital at the beginning and end of 2016 was EUR 66 820 528. The total number of shares issued was 55 026 522, and it was divided into two share series as follows: A Shares, 49 626 522 (90.19% of the total number of shares) and K Shares 5 400 000 (9.81%). The A Shares are quoted on the Nasdaq Helsinki Ltd. The K Shares are held by LSO Osuuskunta (4 735 000 shares) and Lantmännen ek.för. (665 000 shares) and are not listed.

According to the Articles of Association, each A Share conveys one vote, and each K Share 20 votes. Each share gives equal entitlement to a dividend. The shares have no nominal value.

HKScan’s market capitalization at the end of the year stood at EUR 172.3 (205.6) million based on the closing price of the last trading day of the period. The Series A shares had a market value of EUR 155.1 (185.1) million, and the unlisted Series K shares EUR 17.2 (20.6) million correspondingly.

In 2016, a total of 13 313 324 of the company’s shares, with a total value of EUR 42 427 708, were traded. The highest price quoted was EUR 3.89 and the lowest EUR 2.89. The average price was EUR 3.18. At the end of 2016, the closing price was EUR 3.19.


At the end of 2016, the shareholder register maintained by Euroclear Finland Ltd included 13 226 (12 558) shareholders. Nominee-registered and foreign shareholders held 12.6 (24.9) per cent of the company's shares.

Notifications of changes in holdings

On 21 December 2016, Sveriges Djurbönder ek. för notified that the total amount of HKScan Corporation shares owned by them had decreased below the threshold of ten (10) per cent and the share of voting rights had decreased below five (5) per cent. On 21 December 2016, Sveriges Djurbönder owned 3 615 000 HKScan A-shares and 0 K-shares, and 3 615 000 voting rights.

On 21 December 2016, Lantmännen ek.för notified that the total amount of HKScan Corporation shares owned by them had exceeded the threshold of five (5) per cent and the share of voting rights had exceeded the threshold of ten (10) per cent. On 21 December 2016, Lantmännen owned 2 619 750 HKScan A-shares and 665 000 K-shares, and in total 15 919 750 voting rights.

Treasury shares

At the beginning the financial year 2016, HKScan held 1 053 734 treasury A shares. On 8 April 2016, in total 44 885 treasury shares were gratuitous transferred to the participants of the share based incentive plan 2013 according to its terms.

At the end of 2016 the Group had 1 008 849 treasury A shares, and they had a market value of EUR 3.2 million and accounted for 1.83% of all shares and 0.64% of all votes.

Share-based incentive scheme

Incentive plan 2016 for the Group key personnel was published the stock exchange release dated on 18 December 2015. The plan covers one performance period, year 2016. The potential reward from the performance period will be based on the HKScan Group’s Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) and Earnings per Share (EPS).

Rewards from the performance period will be paid partly in the Company’s A series shares and partly in cash as follows: 50 per cent pay-out in 2017 and 50 per cent pay out in 2018. The cash proportion is intended to cover taxes and tax-related costs arising from the rewards to the key personnel. No reward will be paid, if the key employee’s employment or service ends before reward payment. The plan was preliminary directed to 37 people. The rewards to be paid on basis of the performance period are a maximum approximate total of 366 000 HKScan Corporation series A shares and cash payment corresponding to the value of such shares.

Shareholding of the Board of Directors and the President and CEO

At the end of 2016, members of the Board of Directors and the company’s President and CEO and his deputy, as well as their related parties owned a total of 49 144 A Shares, corresponding to 0.09 per cent of the total number of shares and 0.03 per cent of the votes.


Ownership breakdown by amount of shares on 31 December 2016
Number of shares held Shareholders Shareholders, % Shares Shares, % Votes Votes,%
1–100 3 262 24.66 166 575 0.30 166 575 0.11
101–500 5 054 38.21 1 450 446 2.64 1 450 446 0.92
501–1 000 2 228 16.85 1 740 216 3.16 1 740 216 1.10
1 001–5 000 2 225 16.82 4 970 254 9.03 4 970 254 3.15
5 001–10 000 254 1.92 1 805 497 3.28 1 805 497 1.15
10 001–50 000 154 1.16 3 152 874 5.73 3 152 874 2.00
50 001–100 000 23 0.17 1 606 935 2.92 1 606 935 1.02
100 001–500 000 13 0.10 3 234 071 5.88 3 234 071 2.05
500 001– 13 0.10 36 102 144 65.61 126 067 144 79.98
Total 13 226 100.00 54 229 012 98.55 144 194 012 91.48
of which nominee registered 8 6 819 442 12.39 6 819 442 4.33
Waiting list 1 665 000 1.21 13 300 000 8.44
General account 132 510 0.24 132 510 0.08
Number of shares issued 55 026 522 100.00 157 626 522 100.00

Share capital by share series on 31 December 2016
Share series Shares Share of equity, % Share of votes, %
A shares 49 626 522 90.19 31.48
K shares 5 400 000 9.81 68.52
Total 55 026 522 100 100
Ownership breakdown by sector on 31 December 2016
Share of owners,
Share of shares,
Share of votes,
Corporates 3.69 44.32 72.55
Finance and insurance companies 0.14 1.41 4.75
Public entities 0.05 6.97 2.44
Households 95.34 23.68 8.27
Non-profit organizations 0.54 3.06 1.07
Domestic sectors, total 99.77 79.44 89.07
Abroad 0.23 6.71 2.41
All sectors, total 100.00 86.16 91.48
General account 0.24 0.08


20 largest shareholders on 31 December 2016
A shares K shares Of total shares, % Of total votes, %
1 LSO Osuuskunta 14 458 884 4 735 000 34.88 69.25
2 Sveriges Djurbönder Ek. För. 3 615 000 0 6.57 2.29
3 Varma Mutual Pension Insurance Company 1 192 806 0 2.17 0.76
4 Elo Pension Company 1 142 830 0 2.08 0.73
5 HKScan Corporation 1 008 849 0 1.83 0.64
6 Tiiviste-Group OY 1 000 000 0 1.82 0.63
7 The Central Union of Agricultural Producers and Forest Owners (MTK) 836 414 0 1.52 0.53
8 Apteekkien Eläkekassa 752 500 0 1.37 0.48
9 Hisinger-Jägerskiöld Eva 560 000 0 1.02 0.36
10 Petter and Margit Forsström´s Foundation 510 500 0 0.93 0.32
11 The State Pension Fund 500 000 0 0.91 0.32
12 Hallqvist AB 405 000 0 0.74 0.26
13 Nordea Life Assurance Finland Ltd. 400 000 0 0.73 0.25
14 Sijoitusrahasto Taaleritehdas Arvo Markka Osake 350 000 0 0.64 0.22
15 Suhonen Jyrki 220 312 0 0.40 0.14
16 Ilmarinen Mutual Pension Insurance Company 218 298 0 0.40 0.14
17 Gripenberg Jarl Estate 169 000 0 0.31 0.11
18 K. Hartwall Invest Oy Ab 163 300 0 0.30 0.10
19 Ollikainen Pekka 122 000 0 0.22 0.08
20 Ab 2011 Fruitgum Company Oy 120 000 0 0.22 0.08
Other shareholders, total 21 880 829 0 40.94 22.31
All shares, total 49 626 522 5 400 000 100.00 100.00
Source: Euroclear Finland


In 2016, HKScan had an average of 7 319 (7 437) personnel.
The average number of employees in each market area was as follows:

2016 2015
Sweden 2 162 2 176
Finland 2 912 2 840
Denmark 686 726
Baltics 1 560 1 696
Total 7 319 7 437

Short-term risks and uncertainty factors

The most significant uncertainty factors in the HKScan Group’s business are related to sales and raw material prices, as well as management of global and local meat balances.

The risks include various unexpected actions potentially taken by authorities or pressure groups, which may cause restrictions to the business or volatility in demand.

In the food industry’s raw material supply, the risks of animal diseases, such as the African Swine Fewer (ASF) currently in Estonia, or any international or regional food scandals impacting the overall consumption outlook cannot be fully excluded.

Corporate Governance

HKScan’s Audit Committee has compiled a separate Corporate Governance Statement for the Group. The statement will be published as part of the online Annual Report 2016 on the company’s web site on week 10/2017.

Events after the reporting period

On 13 January 2017, HKScan lowered its outlook for 2016.

On 19 January 2017, HKScan announced that it had acquired the remaining 50% of Paimion Teurastamo (Paimio Slaughterhouse). HKScan Finland had acquired a 50% holding in the company in summer 2015. 

On 8 February 2017, HKScan informed on renewing its Group Leadership Team and simultaneously initiating a review of its operating model.

On 8 February 2017, HKScan informed about plans to embark on a partial re-organization of its operations as part of the review of its operating model. The potential impacts on personnel of the planned operating model renewal and planned efficiency upgrades will be assessed in Group-wide statutory negotiations.

Outlook for 2017

HKScan aims to reach the comparable operating profit (EBIT) of the year 2016.

Board of Directors’ proposal on distribution of profit

The parent company’s distributable equity stands at EUR 307.9 million including the reserve for invested unrestricted equity, which holds EUR 143.2 million. The Board of Directors recommends that the company pay a dividend of EUR 0.16 per share for 2016, i.e. a total of approximately EUR 8.6 million.

There have been no material changes in the company’s financial standing since the end of the year under review. The company maintains good liquidity and the recommended distribution of dividend will not in the Board’s estimation compromise the company’s solvency.

Annual General Meeting 2017

HKScan Corporation’s Annual General Meeting 2017 will be held starting at 10 am on 6 April 2017 at Logomo, Turku. To be eligible to attend the Annual General Meeting, shareholders should register by 27 March 2017 in HKScan Corporation’s shareholder register maintained by Euroclear Finland Ltd. Notice to the Annual General Meeting will be published at a later date.