Glaston Oyj Abp - Interim report (Q1 and Q3)

Glaston Interim Report 1 January – 31 March 2016: Net sales and orders received grew

Helsinki, Finland, 2016-04-28 12:00 CEST (GLOBE NEWSWIRE) -- GLASTON
CORPORATION          INTERIM REPORT    28.4.2016  AT 13.00 


GLASTON’S INTERIM REPORT 1 JANUARY – 31 MARCH 2016: Net sales and orders
received grew 

This release is a summary of Glaston Corporation's Interim Report for
January-March 2016. The complete report is attached to this release as a
pdf-file. The stock exchange release is also available on the company's website
at the address www.glaston.net. 

This interim report’s comparison year figures refer to Continuing Operations.

JANUARY-MARCH 2016

  -- Orders received totalled EUR 25.0 (22.5) million.
  -- The order book on 31 March 2016 was EUR 34.5 (52.8) million.
  -- Net sales totalled EUR 29.4 (26.3) million.
  -- EBITDA was EUR 1.4 (2.1) million, i.e. 4.7 (8.0)% of net sales. 
1)
  -- The operating profit was EUR 0.7 (1.2) million, i.e. 2.4 (4.7)% of net
     sales.
1)
  -- Continuing Operations’ return on capital employed (ROCE) was 6.0 (25.8)%.
  -- Continuing Operations’ earnings per share were EUR 0.00 (0.01).
  -- Interest-bearing net liabilities amounted to EUR 10.9 (-1.2) million.


 1) Due to the sale of the pre-processing machines business, figures for 2015
have been restated. Internal purchases eliminated in the comparison figures up
to 30 June 2015 changed from 1 July 2015 to external purchases. This impacts
the comparability of Continuing Operations’ operating profit. In Continuing
Operations’ comparable operating profit, those internal items that from 1 July
2015 changed to external items have been restated 


GLASTON’S OUTLOOK UNCHANGED
We expect 2016 net sales to be slightly below the 2015 level and that operating
profit, excluding non-recurring items, will be at the 2015 level. (In 2015 net
sales were EUR 123.4 million and comparable operating profit, excluding
non-recurring items, was EUR 6.1 million). 

PRESIDENT & CEO ARTO METSÄNEN:
“At the end of last year, uncertainty in the glass processing market increased,
and the situation remained unchanged as we entered the new year. In the first
quarter, the markets were relatively quiet, except for North America. In an
unstable market situation, reliability and quality become even stronger
competitive factors and we succeeded in increasing our market share. 

Despite the market instability, our net sales grew by 12% compared with the
corresponding period the previous year and totalled EUR 29.4 million. Our
comparable operating profit was EUR 0.7 million. Order intake was EUR 25.0
million, representing 11% growth compared with the previous year. 

We cannot be satisfied with our operating profit and therefore we have
initiated measures to improve our profitability. We will further intensify our
cost saving programmes, which still primarily concern Brazil and China. In
Finland, we have already launched an action programme to reduce fixed costs. 

In March, we announced our updated strategy as well as our financial targets
for the period 2016–2018. Glaston is moving to a new strategic phase, the
cornerstones of which are growth, technology leadership and the industry’s best
customer experience. We will focus on high-technology heat treatment and
services. Our core expertise is flat tempering technology. In this segment, we
estimate that our global market share is slightly under 40%. We are pursuing
growth through product development and a first-class product range. Based on
our core business, we see growth opportunities not only in flat tempering
technology but also in other safety glass categories, such as bending,
tempering-bending and laminating.” 





                                                31.3.2016  31.3.2015  31.12.2015
KEY FIGURES                                                                     
                                                                                
Order book, EUR million                              34.5       52.8        38.5
Orders received, EUR million                         25.0       22.5       107.4
Net sales, EUR million                               29.4       26.3       123.4
EBITDA, comparable, EUR million                       1.4        2.1         7.9
EBITDA, comparable, as % of net sales                 4.7        8.0         6.4
Operating result (EBIT), comparable,  EUR             0.7        1.2         4.5
 million                                                                        
Operating result (EBIT), comparable, as % of          2.4        4.7         3.6
 net sales                                                                      
Profit / loss for the period, EUR million             0.2        0.1       -13.8
Earnings per share, continuing and                   0.00       0.00       -0.07
 discontinued operations, EUR                                                   
Net cash flow from operating activities              -1.8       -3.3        -3.0
Return on capital employed, %, annualized             6.0       15.2       -13.8
Gross capital expenditure, continuing and             1.5        1.6         7.2
 discontinued operations, EUR million                                           
Equity ratio, %                                      45.3       45.3        43.9
Gearing, %                                           38.7       30.6        36.7



OPERATING ENVIRONMENT
In the first quarter of 2016, uncertainty was still perceptible in the glass
processing market. After a quiet January, the market picked up during February
and March. In North America, the growth of the market continued. In the EMEA
area, markets were still challenging. In South America, particularly in Brazil,
the markets remained subdued. In Asia, particularly in China, market
instability continued. 

Machines
In the first quarter, the Machines business markets developed reasonably
positively and Glaston maintained its strong market position in the flat
tempering machines segment. 

In North America, demand continued at a good level. In the EMEA area, the
market slowed down in the latter part of 2015, but however in the first quarter
the market situation was reasonable. In Asia and South America, market
uncertainty continued. In China, demand was affected by slower economic growth
as well as the large investments in production capacity expansions of previous
years. In Brazil, the uncertain political situation and a shortage of
reasonably priced financing put the brake on customers’ investment willingness. 

During the review period, Glaston sold a number of RC200™, RC350™ and FC500™
machines. The company also closed a major deal of approximately EUR 4 million
with a leading US glass manufacturer for flat tempering and laminating lines.
In automotive products, Glaston received a large Matrix™ machine order from
Egypt. 

Services
After a quiet January, the Services business markets picked up during February
and March. Services’ strongest market area was in North America, where, for
example, a large modernisation deal was closed for a Glassrobots flat tempering
machine. In Asia, market activity was at the previous year’s level. In the EMEA
area and South America, the market situation was challenging, and demand for
services remained weak. 

In modernisation products, the first quarter was quiet. With the exception of
North America, the market situation was difficult and new orders were at a low
level. The spare parts product group developed positively and invoicing grew by
26% compared with the corresponding period of the previous year. The number of
new service agreements fell short of expectations. 

OUTLOOK UNCHANGED
Glaston still expects the overall market to develop on a cautiously positive
note. The North American market and the EMEA area are expected to develop
positively. We expect the Asian markets to remain stable at their current
level. In China, market activity continues to be low. In South America, market
continues to be subdued, particularly in Brazil. 

In the heat treatment machines market, no significant changes are anticipated,
and we expect demand for heat treatment machines to remain at the previous
year’s level. The outlook for the services market continues to be cautiously
positive. 

Glaston’s outlook remains unchanged. Due to the subdued market situation and
the reduced order book, we expect 2016 net sales to be slightly below the 2015
level. We expect the operating profit, excluding non-recurring items, to be at
the 2015 level. (In 2015 net sales were EUR 123.4 million and comparable
operating profit, excluding non-recurring items, was EUR 6.1 million). 

PRESS MEETING
An analyst and press conference is organized at Glaston's office on
Yliopistonkatu 7, Helsinki, on 28 April 2016 at 14.00 p.m. 

For further information, please contact:
President & CEO Arto Metsänen, tel. +358 10 500 500
Chief Financial Officer Sasu Koivumäki, tel. +358 10 500 500





GLASTON CORPORATION
Agneta Selroos
Communications Director



Glaston Corporation
Glaston is a leading company in glass processing technologies. We provide
high-quality heat treatment machines and services for architectural, solar,
appliance and automotive applications. We are committed to our customers’
success over the entire lifecycle of our offering. Moreover, we continuously
innovate and develop technologies to enable the glass processing industry to
reach ever higher standards in quality and safety. Glaston’s shares (GLA1V) are
listed on NASDAQ Helsinki Ltd. Further information is available at
www.glaston.net 

Distribution: NASDAQ Helsinki Ltd, key media, www.glaston.net

Attachments:

Glaston Q1 2016 interim report.pdf