Etteplan Oyj - Interim report (Q1 and Q3)

ETTEPLAN Q3 2017: Profitability improved and strong organic growth continued

ETTEPLAN Oyj Interim Report October 25, 2017 at 2:00 pm

ETTEPLAN Q3 2017: Profitability improved and strong organic growth continued

Review period July-September 2017

  · The Group’s revenue increased by 12.3 per cent and was EUR 47.1 million (7
-9/2016: EUR 42.0 million). At comparable exchange rates, revenue increased by
12.5 per cent.
  · Organic revenue growth was 11.1 (-3.5) per cent. At comparable exchange
rates, organic growth was 11.3 per cent.
  · EBIT from business operations* improved and amounted to EUR 3.4 (2.4)
million, or 7.1 (5.8) per cent of revenue. EBIT from business operations
included exceptional items with a combined negative effect of EUR 0.1 (0.3)
million.
  · Operating profit (EBIT) was EUR 2.9 (1.9) million, or 6.1 (4.4) per cent of
revenue.
  · The profit for the review period was EUR 2.1 (1.5) million.
  · Operating cash flow improved and was EUR -1.2 (-3.6) million.
  · Undiluted earnings per share were EUR 0.08 (0.05).

Review period January-September 2017

  · The Group’s revenue increased by 19.5 per cent and was EUR 156.2 million (1
-9/2016: EUR 130.8 million). At comparable exchange rates, revenue increased by
20.1 per cent.
  · Organic revenue growth was 11.0 (2.5) per cent. At comparable exchange
rates, organic growth was 11.6 per cent.
  · EBIT from business operations* improved and amounted to EUR 12.4 (7.5)
million, or 7.9 (5.7) per cent of revenue. EBIT from business operations
included exceptional items with a combined negative effect of EUR 0.7 (1.5)
million.
  · Operating profit (EBIT) was EUR 10.9 (6.1) million, or 7.0 (4.7) per cent of
revenue.
  · The profit for the review period was EUR 8.1 (4.7) million.
  · Operating cash flow improved and was EUR 6.1 (-4.2) million.
  · Undiluted earnings per share were EUR 0.33 (0.20).
  · The number of personnel increased and the Group had 2,781 employees at the
end of the review period (2,508).

*EBIT from business operations is an alternative performance measure, which
reflects the Company’s operational performance: it does not include acquisition
-related items such as amortization on PPA allocations and earn out
revaluations.
Espotel Oy and Soikea Solutions Oy, which were acquired in spring 2016, are
included in the figures for the comparison period starting from the second
quarter of 2017.

Market outlook 2017

The most important factor for Etteplan's business is the global development of
the machinery and metal industry. Our business environment is currently
developing favorably in all market areas. The development of the Central
European markets is expected to remain unchanged. The favorable situation in the
Swedish market is expected to continue. The market situation in Finland has
improved and good demand is expected to continue. In Asia, the growth of the
service market is expected to continue.

Financial guidance 2017, updated on May 3, 2017

We expect the revenue and operating profit for the full year 2017 to grow
significantly compared to 2016.

Key figures

(EUR 1,000)       7-9/2017  7-9/2016  1-9/2017  1-9/2016  1-12/2016
Revenue           47,132    41,986    156,248   130,800   183,938
EBIT from         3,364     2,425     12,362    7,514     12,071
business
operations
EBIT from         7.1       5.8       7.9       5.7       6.6
business
operations, %
Operating profit  2,887     1,866     10,932    6,115     10,131
(EBIT)
EBIT, %           6.1       4.4       7.0       4.7       5.5
Basic earnings    0.08      0.05      0.33      0.20      0.33
per share, EUR
Equity ratio, %   40.7      39.7      40.7      39.7      40.0
Operating cash    -1,209    -3,640    6,096     -4,174    5,661
flow
ROCE, %           13.1      11.2      16.5      12.1      14.8
Personnel at end  2,781     2,508     2,781     2,508     2,545
of the period

President and CEO Juha Näkki:

The third quarter of the year was successful for us. The demand situation
remained good in all of our market areas and we were able to improve all of our
key indicators compared to the previous year. Strong organic growth continued,
our profitability and cash flow improved substantially, and we made progress
toward our strategic goals.

The Engineering services service area developed favorably and demand from key
accounts, in particular, was at a good level. Our Managed Services proved their
strength and we continued to win market share. Some new plant engineering
projects also started during the review period and we won several significant
deals.

The Embedded systems and IoT service area saw continued good demand and our
business grew in spite of the reduced availability of competent professionals.
However, the excess hours in certain projects, which weighed down on our
profitability in the second quarter, continued in the third quarter. Corrective
actions to improve the profitability of the project business are ongoing and I
expect to see improvements in the results already in the fourth quarter.

In Technical documentation, the development of our business was again excellent,
boosted by strong demand and the success of the outsourcing business. During the
review period, we also continued to invest in the development of our service
offering to deliver even greater added value to our customers in the face of
growing information flows and increasing digitalization.

We will continue to invest in growth and the improvement of profitability in the
fourth quarter. Our service offering and excellent customers provide us with a
solid foundation for continued positive development during the remainder of the
year.

Disclosure procedure

This stock exchange release is a summary of Etteplan's January-September 2017
Interim Report. The complete Interim Report is attached to this stock exchange
release in pdf format and is also available on Etteplan's website
at www.etteplan.com.

Conference call and live webcast today, October 25, 2017

Etteplan's President and CEO Juha Näkki will present Company's results for
January-September 2017 in a conference call and a live webcast for analysts and
investors, held in English language, on October 25, 2017 starting at 3.30
p.m. Finnish time (EET).

To participate in the conference call please dial 5-10 minutes prior to the
start of the conference to +358 (0)9 7479 0360  and tell operator the event
password 627585. Questions can be asked in English after President and CEO’s
presentation only through conference call connection.

Juha Näkki’s presentation can be followed as a live webcast
on http://platform.goodmood.fi/goodmood/etteplan/live. The webcast starts
at 3.30 p.m. Finnish time (EET). A recording of the webcast will be later
available at www.etteplan.com/Investors.

Vantaa, October 25, 2017

Etteplan Oyj

Board of Directors

The information presented herein has not been audited.
Releases and other corporate information are available on Etteplan's website
at www.etteplan.com.

DISTRIBUTION:
Nasdaq Helsinki
Major media
www.etteplan.com
Additional information:
Juha Näkki, President & CEO, tel. +358 10 307 2077
Outi Torniainen, Senior Vice President, Communications & Marketing, tel. +358 10
307 3302
Etteplan provides industrial equipment and plant engineering, embedded systems,
IoT (Internet of Things), and technical documentation solutions to the world’s
leading companies in the manufacturing industry. Our services are geared to
improve the competitiveness of our customers' products and engineering processes
throughout the product life cycle. The results of Etteplan’s innovative
engineering can be seen in numerous industrial solutions and everyday products.

In 2016, Etteplan had a turnover of EUR 183.9 million. The company currently has
some 2,800 professionals in Finland, Sweden, the
Netherlands, Germany, Poland and China. Etteplan'sshares are listed on Nasdaq
Helsinki Ltd under the ETTE
ticker. www.etteplan.com (http://otp.investis.com/clients/fi/etteplan/omx/www.ett
eplan.com)

Attachments:

10259082.pdf