Exel Composites Oyj - Half Year financial report

Exel Composites Plc’s January–June Half-year Financial Report 2017: “Significant increase in order intake, revenue and operating profit”

EXEL COMPOSITES PLC       HALF-YEAR FINANCIAL REPORT       20 JULY 2017 at 10:00
EET
Q2 2017 in brief

  · Order intake increased by 15.5% to EUR 23.4 million (Q2 2016: 20.2).
  · Revenue increased by 17.4% to EUR 23.2 million (19.7).
  · Adjusted operating profit improved to EUR 1.7 million (1.2), which is 7.4%
of revenue (5.9%).
  · Net cash flow from operating activities was EUR 1.1 million (0.3).
  · Earnings per share amounted to EUR 0.09 (0.07).

H1 2017 in brief

  · Order intake increased by 19.8% to EUR 45.8 million (38.3).
  · Revenue increased by 15.4% to EUR 43.4 million (37.6).
  · Adjusted operating profit amounted to EUR 3.4 million (1.3), which is 7.8%
of revenue (3.5%).
  · Net cash flow from operating activities was EUR 0.3 million (-0.5).
  · Earnings per share amounted to EUR 0.18 (0.07).

Outlook for full year 2017

Exel Composites reiterates its outlook for 2017 and estimates that revenue with
comparable company structure (i.e. without the acquisition of Nanjing Jianhui
Composite Material, JHFRP) will increase from previous year level and adjusted
operating profit will be higher than previous year level. In 2016, Exel
Composites’ revenue was EUR 73.1 million and adjusted operating profit was EUR
2.6 million.

President and CEO, Riku Kytömäki

In the first half of 2017 order intake, revenue and operating profit continued
to develop positively. In the second quarter, the double digit growth was led by
volume increase from new customers, and supported by a general market
environment recovery. The strong order intake and order backlog in the first
quarter also contributed to the significant increase in revenue for the first
half of 2017.

The Industrial Applications customer segment continued to drive volume growth
during the review period. We continued to gain momentum especially in the mid
-segment through our efforts and focus on new customer acquisition. Despite
lower margin structure, the mid-segment products contributed positively to the
operating profit through higher volumes.

From a regional perspective Asia – and China in particular – was a major
contributor to the increase in revenue in the first half of the year. Volume
growth was mainly organic and only partially affected by the newly acquired
Nanjing Jianhui Composite Material, JHFRP. Also in Europe revenue has developed
well and increased in comparison to the same period last year.

Major factors behind the continued improvement in operating profit were the
significantly higher revenue and the lower cost base. The cost savings measures
from 2016 continued to contribute to an overall reduced cost level. Improvements
in operational efficiency, including the downsizing in Australia, also
contributed to the improvement in the operating profit. The downsizing of the
Australian unit is progressing according to plan and we expect production there
to cease by the end of this year.

The acquisition of Nanjing Jianhui was successfully completed in April 2017 and
was consolidated into Group accounts as of 1 May 2017. The integration process
proceeds according to plan. Nanjing Jianhui is an important element of our
growth strategy in China as it strengthens our position in the Chinese market
and improves our export capacity to other markets.

To sum it up; the results of the first half of 2017 reflect good growth in our
focus segments and a continued tight cost control.

Consolidated key figures

EUR         1.4.–30.6.  1.4.–30.6.  Change,  1.1–30.6.  1.1.–30.6.  Change,
1.1.–31.12.
thousand          2017        2016        %       2017        2016        %
2016
Order           23,359      20,231     15.5     45,839      38,263     19.8
74,778
intake
Order           19,436      15,799     23.0     19,436      15,799     23.0
16,702
backlog¹
Revenue         23,150      19,720     17.4     43,447      37,639     15.4
73,079
Operating        1,488       1,147     29.8      3,144       1,293    143.2
649
profit
% of               6.4         5.8                 7.2         3.4
0.9
revenue
Adjusted         1,722       1,167     47.6      3,387       1,316    157.4
2,621
operating
profit²
% of               7.4         5.9                 7.8         3.5
3.6
revenue
Profit for       1,060         882     20.2      2,166         880    146.2
198
the
period
Net cash         1,101         342    221.9        253        -520    148.7
3,129
flow from
operating
activities
Return on         14.9        11.4                16.0         6.5
1.7
capital
employed,
%
Net               29.3        18.4                29.3        18.4
12.2
gearing, %
Earnings          0.09        0.07                0.18        0.07
0.02
per share
Equity per         2.3        2.35     -2.1        2.3        2.35     -2.1
2.27
share,
EUR
Employees          534         487      9.7        498         490      1.6
479
on
average

¹ As per the end of the period.
² Excluding material items affecting comparability, such as restructuring costs,
impairment losses and reversals, and costs related to planned or realized
business acquisitions or disposals. For more information, please refer to the
paragraph “Change in Exel Composites’ financial reporting terminology” of the
Half-year Financial Report published on 21 July 2016.

Exel Composites’ half-year financial report January – June 2017 is available in
full in pdf format as an attachment to this release. The report and the related
presentation are also available at the company’s website under the Investor
section.

Vantaa, 20 July 2017

Exel Composites Plc
Board of Directors
For further information, please contact:

Riku Kytömäki, President and CEO
tel. +358 50 511 8288
riku.kytomaki@exelcomposites.com

Mikko Kettunen, CFO
tel. +358 50 347 7462
mikko.kettunen@exelcomposites.com

Distribution

Nasdaq Helsinki Ltd
Main news media
www.exelcomposites.com
Exel Composites in brief

Exel Composites (www.exelcomposites.com) is a leading composite technology
company that designs, manufactures and markets composite products and solutions
for demanding applications. Exel Composites provides superior customer
experience through continuous innovation, world-class operations and long-term
partnerships.

The core of the operations is based on own, internally developed composite
technology, product range based on it and strong market position in selected
segments with a strong quality and brand image. Profitable growth is pursued by
a relentless search for new applications and development in co-operation with
customers. The personnel’s expertise and high level of technology play a major
role in Exel Composites’ operations. Exel Composites Plc share is listed in
Nasdaq Helsinki Ltd.

Liitteet:

07171700.pdf