2008-02-06 07:30:00 CET
2008-02-06 07:30:50 CET
REGULATED INFORMATION
Glaston Oyj Abp - Company Announcement
Glaston's result improved
GLASTON CORPORATION STOCK EXCHANGE RELEASE 6 February 2008
8.30 am
Glaston's result improved, Group ended year well
- Consolidated net sales grew by 23% to EUR 269.8 million (restated
*1-12/2006: 218.9). In the final quarter of the year, net sales
totalled EUR 88.8 million (restated 10-12/2006: 64.0).
- Operating profit excluding non-recurring items was EUR 16.6 million
(comparable restated**1-12/2006: 10.9), i.e. 6.2% (5.0) of net sales.
In the final quarter of the year, operating profit was EUR 7.1
million (comparable restated 10-12/2006: 5.5), i.e. 8.0% (8.5) of net
sales.
- Return on capital employed improved and was 12.1% (restated 8.8).
- Orders received totalled EUR 212.7 million (1-12/2006: 195.5). In
the final quarter of the year, orders received totalled EUR 42.0
million (restated 10-12/2006: 57.6).
- Order book on 31 December 2007 was EUR 87.0 million (31.12.2006:
97.8).
- Earnings per share were EUR 0.14 (restated 1-12/2006: 0.11), of
which the final quarter contribution was EUR 0.10 (restated
10-12/2006: 0.01).
- The Board of Directors proposes to the AGMeeting that a dividend of
EUR 0.10 (0.09) per share be distributed
- Glaston's market outlook for 2008 remains good. Growing markets
elsewhere are balancing the instability evident in North America.
President & CEO Mika Seitovirta:"2007 was a year of important changes for Glaston. Our net sales grew
by nearly a quarter. The main key figures, such as operating profit
and return on capital employed, took an upward turn. Measures aimed
at improving the Group's profitability will continue in order to
achieve the financial targets."At the end of the financial year, Glaston's order book was at
satisfactory levels. Financial market instability and a downturn in
private construction in the USA have had an impact on Heat
Treatment's order book. We believe, however, that the order book will
develop well during the early part of 2008."Glaston's new strategy, development programmes and financial targets
were announced in January 2008. The architectural glass segment,
supported by the solar energy market, creates a foundation for the
Group's profitable growth. In terms of the appliance and automotive
industries, we are focusing on improving cash flow and
profitability."
Group structure and segmentation
In this report, Glaston's figures are divided into Continuing
Operations and Discontinued Operations. The primary segments of
Continuing Operations are the business areas Pre-Processing and Heat
Treatment, and, as of the third quarter, Software Solutions.
The secondary segments reported quarterly for Continuing Operations
are the geographical segments EMEA (Europe, Middle East and Africa),
America (North, Central and South America) and Asia (China and the
rest of the Asia-Pacific area).
*, **) calculation principles in the enclosure of this stock exchange
release
The Pre-Processing segment includes glass pre-processing machines
sold under the Bavelloni brand, maintenance and service operations,
as well as tool manufacturing. The Heat Treatment segment includes
tempering, bending and laminating machines sold under the Tamglass
and Uniglass brands, maintenance and service operations, as well as
the glass processing operations of Tamglass Glass Processing. The
Software Solutions segment comprises the operations of the A+W
Software Group. Group costs unallocated to the segments will be
reported separately.
The Discontinued Operations' Energy business area figures are
published in accordance with the reporting practice of the IFRS 5
standard Discontinued Operations.
Markets
Glaston's markets developed favourably during the financial year,
except for North America. Public construction continued to be strong
in all market areas. In the residential construction market, on the
other hand, there were large differences between areas.
In the developed markets and particularly in the EMEA area, Glaston's
One-Stop-Partner concept, namely the combination and joint delivery
of pre-processing and safety glass machines and now as well
production management systems, was well received. In summer 2007,
Glaston received two significant orders, the larger of which, after
its completion, will be a complete glass processing factory producing
architectural glass.
Pre-Processing
The market situation of the Pre-Processing business area was good
throughout the year. Net sales in 2007 were EUR 94.1 million (89.1),
representing growth of 5.6 per cent and operating profit EUR 1.4
(0.3) million. The order book at the end of the year was EUR 20.9
million (19.9). The most active market areas were South America and,
in contrast with the Heat Treatment business area, North America.
Due to efficiency measures as well as steps to enhance the delivery
process, the Pre-Processing business area achieved a positive, if
still modest, result in 2007.
In Italy, manufacturing was reorganised and production was moved from
Bergamo and centralised in Bregnano. Efficiency measures included the
merger of Pre-Processing production with Heat Treatment in Brazil.
The Pre-Processing business area received a new management team in
2007.
Heat Treatment
The market situation of the Heat Treatment business area was
generally good. Demand for safety glass machines grew, particularly
in the Middle East, Eastern Europe, China and South America. Net
sales in 2007 were EUR 162.3 million (131.3), representing growth of
24 per cent and operating profit EUR 19.6 (13.5) million. The order
book at the end of the year was EUR 59.9 million (77.9). The order
book level was influenced particularly by weaker demand in North
America and the transfer of a number of orders to the beginning of
2008.
Heat Treatment focused on growing the sales and market position of
products launched in 2006. Demand for comprehensive solutions grew in
2007, as did demand coming from manufacturers of solar energy panels
and mirrors.
The Cattin unit's safety glass machine product development was
discontinued in Switzerland and the operations in Finland. The unit
was closed during the third quarter. Production at the new factory in
China began in May 2007, and it will answer growing demand in China
and Asia. Finnish factory delivery volume was also increased to meet
high demand from the EMEA area. The Heat Treatment business area's
management team was renewed in 2007.
Software Solutions
The market situation of the Software Solutions business area was good
throughout the year. The Eastern Europe area and Russia grew
strongly, as did the Middle East. Net sales in 2007 (7-12/2007) were
EUR 14.7 million and operating profit EUR 2.6 million. The North
American market situation has not affected the Software Solutions
business area's sales, because a number of large glass manufacturers
are investing in new software solutions.
In 2007 the most significant single event was the A+W Software
Group's incorporation into Glaston and the substantial integration
process that followed it. Integration has proceeded faster than
expected.
Service Solutions
Service Solutions unit's net sales were EUR 45.9 million,
representing 40 per cent growth from the previous year. Half of this
growth was organic. The unit is not reported as a separate business
area; its earnings are included in the reporting business areas.
Service solutions business grew during the financial year, especially
in the EMEA area and North America. In the final quarter of the year,
there was particular demand for options and spare parts. In the USA,
where new investments by glass processors have slowed down, Glaston's
customers opted instead for software updates and options.
One-Stop-Partner
Total One-Stop-Partner sales, namely joint deliveries and
combinations of pre-processing and safety glass machines as well as
production management systems, were EUR 47.7 million (18.8) during
the financial year. Earnings from OSP operations are officially
included in the reporting segments. Completed orders have focused on
systems producing solar energy as well as glass processing factories
manufacturing architectural glass. Strongest growth was in the EMEA
area and the North Asian market, which together represented 85 per
cent of OSP sales.
Orders received
Glaston received orders during the financial year amounting to
EUR 212.7 (195.5) million, representing growth of 9 per cent from the
previous year. In the final quarter of the year, order intake was
EUR 42.0 (10-12/2006: 57.6) million.
Geographical distribution of orders received, EUR million
+---------------------------------------------+
| | 1-12/2007 | 1-12/2006 | Change, % |
|---------+-----------+-----------+-----------|
| EMEA | 134.4 | 108.7 | +24 |
|---------+-----------+-----------+-----------|
| America | 44.0 | 58.4 | -25 |
|---------+-----------+-----------+-----------|
| Asia | 34.3 | 28.4 | +21 |
|---------+-----------+-----------+-----------|
| Total | 212.7 | 195.5 | +9 |
+---------------------------------------------+
Order book
Glaston's order book on 31 December 2007 was EUR 87.0 million
(31.12.2006: 97.8). The Heat Treatment business area accounted for
EUR 59.9 million of the order book, Pre-Processing for EUR 20.9
million and Software Solutions for EUR 6.2 million.
+---------------------------------------------------+
| Order book, EUR million | 31.12.2007 | 31.12.2006 |
|-------------------------+------------+------------|
| Pre-Processing | 20.9 | 19.9 |
|-------------------------+------------+------------|
| Heat Treatment | 59.9 | 77.9 |
|-------------------------+------------+------------|
| Software Solutions | 6.2 | - |
|-------------------------+------------+------------|
| Total | 87.0 | 97.8 |
+---------------------------------------------------+
Net sales and operating profit
Glaston's net sales in the financial year grew by 23 per cent to
EUR 269.8 (adjusted 1-12/2006: EUR 218.9) million. In the final
quarter of the year, net sales totalled EUR 88.8 million (adjusted
10-12/2006: 64.0). Pre-Processing's net sales in October-December
were EUR 28.5 million (10-12/2006: 26.6), Heat Treatment's net sales
were EUR 52.8 million (38.6) and Software Solution's net sales were
EUR 7.9 million.
+-------------------------------------------------------------------+
| Net sales, | 1-12/2007 | 1-12/2006 | 10-12/2007 | 10-12/2006 |
| EUR million | | | | |
|-----------------+-----------+-----------+------------+------------|
| Pre-Processing | 94.1 | 89.1 | 28.5 | 26.6 |
|-----------------+-----------+-----------+------------+------------|
| Heat Treatment | 162.3 | 131.3 | 52.8 | 38.6 |
|-----------------+-----------+-----------+------------+------------|
| Software | 14.7 | - | 7.9 | - |
| Solutions | | | | |
|-----------------+-----------+-----------+------------+------------|
| Parent company, | -1.3 | -1.5 | -0.5 | -1.2 |
| elim. | | | | |
|-----------------+-----------+-----------+------------+------------|
| Total | 269.8 | 218.9 | 88.8 | 64.0 |
+-------------------------------------------------------------------+
The company's comparable operating profit excluding non-recurring
items was EUR 16.6 million (adjusted 1-12/2006: 10.9), i.e. 6.2 (5.0)
per cent of net sales. In the final quarter of the year, operating
profit was EUR 7.2 million (comparable adjusted 10-12/2006: 5.5),
i.e. 8.0 (8.5) per cent of net sales. The Pre-Processing business
area accounted for EUR 0.2 million of the fourth-quarter operating
profit, Heat Treatment for EUR 7.7 million and Software Solutions for
EUR 1.0 million.
Pre-Processing's operating profit improved during the financial year,
although the level was still unsatisfactory. Heat Treatment's
operating profit developed well during 2007. The result, however, was
burdened by the Tamglass Glass Processing result, which clearly fell
short of set targets. Tamglass Glass Processing's rationalisation
programme will be forcefully continued during 2008. Software
Solutions' result, consolidated since the third quarter, was very
good.
+-------------------------------------------------------------------+
| Operating | 1-12/2007 | 1-12/2006 | 10-12/2007 | 10-12/2006 |
| profit, | | | | |
| EUR million | | | | |
|-----------------+-----------+-----------+------------+------------|
| Pre-Processing | 1.4 | 0.3 | 0.2 | 0.4 |
|-----------------+-----------+-----------+------------+------------|
| Heat Treatment | 19.6 | 13.5 | 7.7 | 5.1 |
|-----------------+-----------+-----------+------------+------------|
| Software | 2.6 | - | 1.0 | - |
| Solutions | | | | |
|-----------------+-----------+-----------+------------+------------|
| Parent company, | -7.0 | -3.0 | -1.8 | 0.0 |
| elim. | | | | |
|-----------------+-----------+-----------+------------+------------|
| Operating | 16.6 | 10.9 | 7.1 | 5.5 |
| profit, total | | | | |
|-----------------+-----------+-----------+------------+------------|
| Non-recurring | -4.6 | -5.2 | +2.8 | -3.5 |
| items | | | | |
|-----------------+-----------+-----------+------------+------------|
| Group, total | 12.0 | 5.6 | 9.9 | 1.9 |
+-------------------------------------------------------------------+
Profit for the financial year was EUR 10.6 million (8.9). Return on
capital employed was 12.1 (8.8) per cent. Earnings per share were
EUR 0.14 (0.11).
Taxes for the financial year totalled EUR 5.2 million (1.7),
representing 43 per cent of the result before taxes. Taxes for the
comparison period included tax refunds of EUR 1.8 million from
previous years, so the comparable effective tax rate was 59 per cent.
Non-recurring items for the financial year totalled EUR 4.6 million
(5.2). In the second quarter, the company recognised EUR 7.3 million
in project post-delivery costs and for business restructuring
measures. In the final quarter of the year, the company recognised a
EUR 2.8 million capital gain from the sale of fixed assets not
belonging to business operations.
Financing and cash flow
The Group's financial position was good. The equity ratio on
31 December 2007 was 55.4 (61.9)per cent. Glaston Continuing
Operations' cash flow from business operations was EUR 8.7 million
(-5.2) and cash flow from investments was EUR -27.3 million (-6.9).
Cash flow from investments includes the cash for acquisition of
Albat+Wirsam shares, namely EUR 17.7 million.
Cash flow from financing in January-December was EUR 1.5 million
(-8.4), including dividends paid in the financial year of EUR 7.1
million (13.4) and an increase in short-term loans of EUR 11.2
million. The growth in borrowing related to financing the acquisition
of Albat+Wirsam shares. Discontinued Operations' cash flow was
EUR 18.3 million (4.8).
The Group's cash and cash equivalents on 31 December 2007 totalled
EUR 11.3 (EUR 10.5) million. Interest-bearing net debt was EUR 10.4
million (-2.7). The ratio of net debt to shareholders' equity
(gearing) was 7.4 (-1.9) per cent.
Acquisitions
In May, Glaston Corporation signed an agreement to acquire the German
Albat+Wirsam Software Group. The deal was finalised on 2 July 2007
and the acquisition price was EUR 21.3 million. The company has 247
employees. The acquisition cost calculation for the shares is stated
in the notes to this bulletin.
The Energy business area, sold by the company to M-real Corporation
in the spring, was officially separated from the Group on 1 July
2007. The value of the deal to Glaston was EUR 15.4 million. The
result and impact of the Energy business on the Group financial
position is described in the notes to this bulletin in the section
'Discontinued Operations'.
Research and development
Research and development expenditure totalled EUR 6.3 million (5.5),
representing 2.2 per cent of net sales. Research and development
expenditure includes the further development of products already on
the market as well as the development of new machines and models.
In the Heat Treatment business area, the focus of product development
was on developing software and automation technology for measuring
glass quality. In addition, there was an emphasis on design relating
to line and factory deliveries as well as on synchronising production
between pre-processing and heat treatment machines. In the
Pre-Processing business area the development focus was also on
integrated lines. In addition, there was an emphasis on developing
both the grinding product range and new, advanced cutting machines.
The focus of development in the Software Solutions business area was
on optimisation. New systems, such as DynOpt and XOPTON Dynamic, sold
well during the year.
Capital expenditure
The Group's capital expenditure during the financial year, excluding
acquisitions, totalled EUR 11.3 (12.0) million. The most significant
individual projects in 2007 were a EUR 4.2 million investment to
production machines as well as a EUR 2.0 million extension to
Tamglass Glass Processing's Lempäälä factory. Capitalised product
development was EUR 2.5 million. During 2007, the company initiated a
major global ERP project to harmonise internal processes and boost
operational efficiency.
Environment
Energy efficiency and alternative energy sources are significant
environmental trends for Glaston. Through increasing environmental
awareness, energy-saving targets will grow. This will generate demand
for energy glass, because using the right kind of glass, energy
consumption can be reduced significantly. Solar energy production
will grow strongly in the coming years, and demand for solar energy
panels and mirrors has grown during 2007. Glaston has the necessary
product range to serve solar energy production needs in the field of
glass manufacturing.
Glaston's products are typically long-term, whether the products in
question are the company's own machines or the end products produced
by them - i.e. special glasses. In terms of Glaston's own operations,
life cycle management of its machines has a key role. According to
the Group's principles, Glaston's raw-materials and services are
purchased in compliance with valid laws, decrees and statutes, as
well as general good business practice. Production plants are
responsible for local environmental issues. Environmental issues are
coordinated at Group level.
Risk management
Glaston operates globally and changes in the development of the world
economy affect the company's operations. The company's most
significant operational risks include management of large projects,
availability and price development of raw materials and components,
management of the subcontractor network, and the availability and
permanence of personnel.
Financial risks such as foreign exchange, interest rate, financing
and credit risks are associated with Glaston's business activity. The
Group's treasury unit manages financial risk centrally in accordance
with the treasury policy approved by the Board of Directors.
Organisation and personnel
The Group's new organisational structure came into effect in July.
During the summer, both the parent company Kyro Corporation and most
of the Group's subsidiaries changed their legal names to Glaston. In
June, the Group decided to centralise its safety glass machine
product development operations in Finland and to discontinue its
Cattin unit in Switzerland. The unit's operational activity ceased in
September, with personnel reductions affecting 12 employees. The
merger in Brazil of Tamglass and Bavelloni production operations,
initiated in March, was completed in the final quarter of the year.
The legal merger of the company is planned to take place during 2008.
Personnel reductions related to the merger affected nine employees.
At the end of the financial year, Glaston had 1,435 (31.12.2006:
1,189) employees. This number includes Albat+Wirsam's personnel, a
total of 247 employees. Of the Group's personnel, 29.6 per cent were
in Finland and 49.3 per cent elsewhere in Europe. The proportion of
Group employees working in Asia was 7.5 per cent and in the Americas
13.6 per cent. The average number of employees was 1,350 (31.12.2006:
1,241).
Changes in company management
Mika Seitovirta became the Group's new President and CEO on 1 January
2007. Two new members were appointed Glaston's Executive Management
Group in March. Kimmo Lautanen was appointed Chief Financial Officer
and Ari Himma Senior Vice President, Human Resources.
Paolo Ceni was appointed SVP, Pre-Processing and member of the
Executive Management Group in April.
Topi Saarenhovi was appointed SVP, Heat Treatment and member of the
Executive Management Group in May.
Günter Befort, Managing Director of Albat+Wirsam Software Group, was
appointed SVP, Software Solutions and member of the Executive
Management Group in July.
Shares and share prices
Glaston's share capital on 31 December 2007 was EUR 12,696,000. A
total of 78,436,500 shares were in circulation on the last day of
2007. During the financial year, a total of 7,993,461 shares were
traded, representing 10.1 per cent of the total number of shares. The
lowest price paid for a share was EUR 2.70 and the highest price EUR
4.53. The average price during the period was EUR 3.84.
Incentive scheme
On 9 May 2007, Glaston's Board of Directors decided on a new
share-based incentive scheme for the Glaston Group's key personnel.
The scheme has three one-year performance periods, namely the
calendar years 2007, 2008 and 2009. Bonuses will be paid in 2008,
2009 and 2010 in company shares and cash. The proportion to be paid
in cash will cover taxes and tax-related costs arising to key
personnel from the bonus. Shares cannot be disposed of within two
years of the bonus being awarded.
The potential bonus from the scheme for the 2007 performance period
will be based on growth of the Group's profit and net sales. If the
targets established for the performance criteria of the incentive
scheme for the years 2007-2009 are attained in full, the bonuses to
be paid on the basis of the scheme will correspond in gross value
(including the portion paid in cash) to approximately 1,305,000
Glaston Corporation shares.
Glaston's Board of Directors confirmed the incentive scheme return
for 2007 as 65.8 per cent. The impact on the result for 2007 is
EUR 0.2 million.
Decisions of the Annual General Meeting
The company's Annual General Meeting was held on 13 March 2007. The
meeting approved the financial statements for 2006 and released the
Board of Directors and the President from liability for the financial
year.
The meeting also approved the Board of Directors' proposal to pay a
dividend of EUR 0.09 per share, a total of EUR 7.1 million.
The Annual General Meeting authorised the Board of Directors to
acquire the company's own shares up to a maximum of 7,605,096 shares.
The shares can be acquired to develop the company's capital
structure, in financing or implementing possible company acquisitions
or other arrangements, as part of the company's or its subsidiaries'
incentive schemes or to be retained by the company or otherwise
disposed of or invalidated.
The Annual General Meeting also decided to authorise the Board of
Directors to decide on the issuing of new shares and/or the disposal
of own shares in the company's possession either against payment or
without payment.
By virtue of the authorisation, the Board of Directors shall be
entitled to decide on the issuing of a maximum of 7,935,000 new
shares and/or the disposal of a maximum of 7,935,000 own shares
possessed by the company, yet so that the total number of shares
issued and/or disposed of can be a maximum of 7,935,000 shares.
The authorisation is valid until the end of the 2009 Annual General
Meeting.
Disposal and acquisition of own shares
As part of the Glaston and Albat+Wirsam Software Group deal, it was
agreed that Albat+Wirsam's founder, Dr Wirsam, would purchase 329,904
own shares in Glaston's possession (treasury shares) at a price of
EUR 3.99.
Glaston's Board of Directors decided to exercise the authority
granted by the Annual General Meeting to acquire the company's own
shares. In 2007 the company acquired 913,500 of its own shares at a
price of EUR 4.30 per share, a total of EUR 3.9 million. The shares
have been acquired to hedge the cash flow risk relating to the
incentive scheme. The authorisation remains unexercised in respect of
7,021,500 shares. At the end of the financial period, Glaston held a
total of 913,500 treasury shares, corresponding to 1.15 per cent of
the total number of the company's shares, with an accounting counter
value of EUR 4.30 per share, a total of EUR 3.9 million.
During the final quarter, the company did not acquire its own shares.
Board of Directors' proposal on profit distribution
The parent company's unrestricted shareholders' equity according to
the balance sheet on 31 December 2007 is EUR 63.4 million, of which
distributable funds total EUR 63.4 million.
On 5 February 2008, the number of shares entitled to a dividend was
78,436,500.
The Board of Directors proposes to the Annual General Meeting that a
dividend of EUR 0.10 per share, a total of EUR 7.8 million, be
distributed. After this, the parent company will have EUR 55.6
million in uncommitted retained earnings.
The date of record for the proposed dividend is 14 March 2008. The
dividend payment date is 25 March 2008. All shares outstanding on the
date of record, excluding treasury shares held by the parent company,
are entitled to a dividend for 2007.
Events after the review period
In order to develop Glaston's comprehensive deliveries and to
accelerate OSP product integration, the One-Stop-Partner unit was
divided into two as of 7 January 2008: an OSP Delivery unit and an
OSP Offering unit. Henrik Reims was appointed SVP, OSP Deliveries
and member of Glaston's Executive Management Group as of 7 January
2008. SVP, Software Solutions Günter Befort is responsible for
developing Glaston's OSP Offering unit as of 7 January 2008. SVP,
One-Stop-Partner Mauri Leponen will leave Glaston on 1 April 2008.
To streamline Finnish operations, Glaston Service Oy's business
operations were transferred on 1 January 2008 to Glaston Finland Ltd.
Oy. The transfer has no impact on the number of personnel.
In January, Glaston announced its new strategy and financial targets.
The architectural glass segment, supported by the solar energy
market, sets the base for future growth. The company's
One-Stop-Partner concept is a strategic strength, and it
distinguishes Glaston from its competitors. In automotive and
appliance industry machines, the focus is on achieving good
profitability and cash flow. Investments in service business activity
will be increased significantly.
Tamglass Glass Processing, which operates mainly in the Finnish
market, has been defined in the new strategy to be outside Glaston's
core operations. The company's immediate focus is on completing the
ongoing rationalisation programme that has already begun. Strategic
options for the future are being studied within Glaston.
The financial targets underlying Glaston's strategy will run until
2010.
The financial targets are:
- Net sales annual growth over 8 per cent
- Operating profit (EBIT) at least 10 per cent
- Return on capital employed (ROCE) at least 20 per cent
Uncertainties in the near future
The Group still considers the short-term uncertainties to be the
development of the US market and the US dollar exchange rate, as well
as the transfer of this development more strongly into other markets.
The price development and availability of raw materials and
components, mainly in Finland, also constitutes a significant
uncertainty factor. Large OSP orders received by Glaston increase the
challenges relating to the production and delivery processes.
Outlook
Glaston is a leading company in a sector that is expanding globally.
The proportion of safety glass used in construction is continually
growing. Environmental questions such as the energy efficiency of
buildings and the high added value of glass products associated with
it also represent a significant development trend that supports
growth. The solar energy market is developing quickly and will open
new opportunities during 2008. Tightening official regulations will
increase sales of safety glass further.
Glaston's outlook for 2008 is positive, with the exception of North
America. Due to the geographical distribution of the company's
operations, however, the economic cycles of Europe, Asia and America
will largely balance each other out.
Demand for OSP comprehensive deliveries is expected to continue to
grow due to customers' increasing efficiency and productivity
requirements.
Glaston expects that it will clearly increase its net sales and
operating profit compared to 2007. Quarterly net sales and profit are
expected to develop as in 2007, with the first quarter being the
weakest and the fourth quarter being the strongest.
Helsinki, 6 February 2008
Glaston Corporation
Board of Directors
Sender:
Glaston Corporation
Kimmo Lautanen
Chief Financial Officer
Tel: +358 10 500 500
Agneta Selroos
IR and Communications Manager
Tel: +358 10 500 520
Further information:
President & CEO Mika Seitovirta, tel: +358 10 500 500
Chief Financial Officer Kimmo Lautanen, +358 10 500 500
Glaston Corporation
Glaston Corporation (formerly Kyro) is a growing, financially solid
and international glass technology company. Glaston is the global
market leader in glass processing machines, and a comprehensive
One-Stop-Partner supplier to its customers. Its product range and
service network are the widest in the industry. Glaston's well-known
brands are Bavelloni in pre-processing machines and tools, Tamglass
and Uniglass in safety glass machines, and Albat+Wirsam Software in
glass industry software.
Glaston's own glass processing unit, Tamglass Glass Processing, is a
local Finnish manufacturer of high quality safety glass products.
Glaston's share (GLA1V) is listed on the OMX Nordic Exchange Helsinki
Mid Cap List.
www.glaston.net
Distribution:
OMX
Main media
www.glaston.net
+----------------------------------------------------------------------+
|Glaston Group | | | | |
|--------------------------+----------+----------+----------+----------|
| | | | | |
|--------------------------+----------+----------+----------+----------|
|Consolidated Income | | | | |
|Statement, EUR million | | Restated| | Restated|
|--------------------------+----------+----------+----------+----------|
| |10-12-2007|10-12-2006| 1-12/2007| 1-12/2006|
|--------------------------+----------+----------+----------+----------|
|Continuing Operations | | | | |
|--------------------------+----------+----------+----------+----------|
|Net sales | 88,8| 64,0| 269,8| 218,9|
|--------------------------+----------+----------+----------+----------|
|Other operating income | 0,3| 0,7| 0,6| 2,4|
|--------------------------+----------+----------+----------+----------|
|Operating expenses | 79,3| 58,2| 246,6| 205,0|
|--------------------------+----------+----------+----------+----------|
|Non-recurring items | -2,8| 3,5| 4,6| 5,2|
|--------------------------+----------+----------+----------+----------|
|Depreciation | 2,6| 1,0| 7,2| 5,4|
|--------------------------+----------+----------+----------+----------|
|Operating profit | 9,9| 1,9| 12,0| 5,6|
|--------------------------+----------+----------+----------+----------|
| % of net sales | 11,2| 3,0| 4,5| 2,6|
|--------------------------+----------+----------+----------+----------|
|Operating profit excluding| | | | |
|non-recurring items | 7,1| 5,5| 16,6| 10,9|
|--------------------------+----------+----------+----------+----------|
| % of net sales | 8,0| 8,5| 6,2| 5,0|
|--------------------------+----------+----------+----------+----------|
|Financial income and | | | | |
|expenses | -0,2| -0,2| -0,0| 0,3|
|--------------------------+----------+----------+----------+----------|
|Profit before taxes | 9,8| 1,7| 12,0| 5,9|
|--------------------------+----------+----------+----------+----------|
|Income tax | -1,7| -1,8| -5,2| -1,7|
|--------------------------+----------+----------+----------+----------|
|Profit for the financial | | | | |
|period, Continuing | | | | |
|Operations | 8,0| 0,0| 6,9| 4,2|
|--------------------------+----------+----------+----------+----------|
| | | | | |
|--------------------------+----------+----------+----------+----------|
|Discontinued Operations | | | | |
|--------------------------+----------+----------+----------+----------|
|Profit for the financial | | | | |
|period, Discontinued | | | | |
|Operations | 0,0| 1,1| 3,8| 4,8|
|--------------------------+----------+----------+----------+----------|
| | | | | |
|--------------------------+----------+----------+----------+----------|
|Profit for the financial | | | | |
|period | 8,0| 1,1| 10,6| 8,9|
|--------------------------+----------+----------+----------+----------|
| | | | | |
|--------------------------+----------+----------+----------+----------|
|Attributable to | | | | |
|--------------------------+----------+----------+----------+----------|
|Equity holders of the | | | | |
|parent | 8,0| 1,1| 10,6| 8,9|
|--------------------------+----------+----------+----------+----------|
|Minority interest | 0,0| 0,0| 0,0| 0,0|
|--------------------------+----------+----------+----------+----------|
| | | | | |
|--------------------------+----------+----------+----------+----------|
|Earnings per share, euros,| | | | |
|Continuing Operations | 0,10| 0,00| 0,09| 0,05|
|--------------------------+----------+----------+----------+----------|
|Earnings per share, euros,| | | | |
|Discontinued Operations | 0,00| 0,01| 0,05| 0,06|
|--------------------------+----------+----------+----------+----------|
|Earnings per share, euros,| | | | |
|total | 0,10| 0,01| 0,14| 0,11|
|--------------------------+----------+----------+----------+----------|
| | | | | |
|--------------------------+----------+----------+----------+----------|
|Consolidated Balance | | | | |
|Sheet, EUR million | | |31.12.2007|31.12.2006|
|--------------------------+----------+----------+----------+----------|
|Assets | | | | |
|--------------------------+----------+----------+----------+----------|
|Non-current assets | | | 120,6| 123,2|
|--------------------------+----------+----------+----------+----------|
|Inventories | | | 46,2| 49,5|
|--------------------------+----------+----------+----------+----------|
|Trade and other | | | | |
|receivables | | | 97,4| 66,9|
|--------------------------+----------+----------+----------+----------|
|Assets recognised at fair | | | | |
|value through | | | | |
|--------------------------+----------+----------+----------+----------|
|profit and loss | | | 0,1| 0,1|
|--------------------------+----------+----------+----------+----------|
|Cash and cash equivalents | | | 11,3| 10,5|
|--------------------------+----------+----------+----------+----------|
| | | | | |
|--------------------------+----------+----------+----------+----------|
|Non-current assets | | | | |
|held-for-sale | | | 0,3| |
|--------------------------+----------+----------+----------+----------|
| | | | | |
|--------------------------+----------+----------+----------+----------|
|Total assets | | | 275,9| 250,2|
|--------------------------+----------+----------+----------+----------|
| | | | | |
|--------------------------+----------+----------+----------+----------|
|Equity and liabilities | | | | |
|--------------------------+----------+----------+----------+----------|
|Equity attributable to | | | | |
|equity holders of the | | | | |
|parent | | | 139,5| 140,1|
|--------------------------+----------+----------+----------+----------|
|Minority interest | | | 0,1| 0,0|
|--------------------------+----------+----------+----------+----------|
|Total equity | | | 139,6| 140,1|
|--------------------------+----------+----------+----------+----------|
|Non-current | | | | |
|interest-bearing | | | | |
|liabilities | | | 1,9| 0,6|
|--------------------------+----------+----------+----------+----------|
|Non-current interest-free | | | | |
|liabilities | | | 19,1| 14,9|
|--------------------------+----------+----------+----------+----------|
|Current interest-bearing | | | | |
|liabilities | | | 19,4| 7,4|
|--------------------------+----------+----------+----------+----------|
|Current interest-free | | | | |
|liabilities | | | 95,9| 87,1|
|--------------------------+----------+----------+----------+----------|
| | | | | |
|--------------------------+----------+----------+----------+----------|
|Total equity and | | | | |
|liabilities | | | 275,9| 250,2|
+----------------------------------------------------------------------+
+-------------------------------------------------------------------+
| Glaston Group | | |
|---------------------------------+----------------+----------------|
| | | |
|---------------------------------+----------------+----------------|
| Consolidated Cash Flow | | |
| Statement, EUR million | | |
|---------------------------------+----------------+----------------|
| | | |
|---------------------------------+----------------+----------------|
| | | Restated |
|---------------------------------+----------------+----------------|
| | 1.1.-31.12. | 1.1.-31.12. |
|---------------------------------+----------------+----------------|
| | 2007 | 2006 |
|---------------------------------+----------------+----------------|
| Cash flow from business | | |
| operations, Continuing | | |
| Operations | | |
|---------------------------------+----------------+----------------|
| Profit for the financial period | 6,9 | 4,2 |
|---------------------------------+----------------+----------------|
| Adjustments | 6,0 | 1,3 |
|---------------------------------+----------------+----------------|
| Cash flow before change in | | |
| working capital | 12,9 | 5,5 |
|---------------------------------+----------------+----------------|
| Change in working capital | 1,2 | -3,1 |
|---------------------------------+----------------+----------------|
| Cash flow from business | | |
| operations before financial | | |
| items and taxes | 14,0 | 2,4 |
|---------------------------------+----------------+----------------|
| Interest received | 0,3 | 0,8 |
|---------------------------------+----------------+----------------|
| Dividends received | 0,0 | 0,0 |
|---------------------------------+----------------+----------------|
| Interest paid | -1,2 | -1,0 |
|---------------------------------+----------------+----------------|
| Taxes paid | -4,5 | -7,5 |
|---------------------------------+----------------+----------------|
| Cash flow from business | | |
| operations | 8,7 | -5,2 |
|---------------------------------+----------------+----------------|
| | | |
|---------------------------------+----------------+----------------|
| Cash flow from investing | | |
| activities, Continuing | | |
| Operations | | |
|---------------------------------+----------------+----------------|
| Acquisition of subsidiaries | -17,7 | |
|---------------------------------+----------------+----------------|
| Investments in tangible and | | |
| intangible assets | -11,3 | -10,9 |
|---------------------------------+----------------+----------------|
| Proceeds from disposal of | | |
| tangible and intangible assets | 1,7 | 2,8 |
|---------------------------------+----------------+----------------|
| Proceeds from sale of other | | |
| investments | 0,0 | 3,2 |
|---------------------------------+----------------+----------------|
| Change in long-term loan | | |
| receivables | | 1,1 |
|---------------------------------+----------------+----------------|
| Taxes on proceeds from disposal | | |
| of energy business operations | | |
| in 2005 | | -2,9 |
|---------------------------------+----------------+----------------|
| Cash flow from investing | | |
| activities | -27,3 | -6,9 |
|---------------------------------+----------------+----------------|
| | | |
|---------------------------------+----------------+----------------|
| Cash flow from financing | | |
| activities, Continuing | | |
| Operations | | |
|---------------------------------+----------------+----------------|
| | | |
|---------------------------------+----------------+----------------|
| Acquisition of treasury shares | -3,9 | |
|---------------------------------+----------------+----------------|
| Disposal of treasury shares | 1,3 | |
|---------------------------------+----------------+----------------|
| Withdrawals of current loans | 14,1 | 5,6 |
|---------------------------------+----------------+----------------|
| Repayments of current loans | -2,9 | |
|---------------------------------+----------------+----------------|
| Repayments of non-current loans | 0,0 | -0,6 |
|---------------------------------+----------------+----------------|
| Dividends paid | -7,1 | -13,4 |
|---------------------------------+----------------+----------------|
| Cash flow from financing | | |
| activities | 1,5 | -8,4 |
|---------------------------------+----------------+----------------|
| | | |
|---------------------------------+----------------+----------------|
| Discontinued Operations | | |
|---------------------------------+----------------+----------------|
| | | |
|---------------------------------+----------------+----------------|
| Cash flow from business | | |
| operations | 7,6 | 4,7 |
|---------------------------------+----------------+----------------|
| Cash flow from investing | | |
| activities | 10,7 | 0,1 |
|---------------------------------+----------------+----------------|
| Cash flow from financing | | |
| activities | 0,0 | 0,0 |
|---------------------------------+----------------+----------------|
| | | |
|---------------------------------+----------------+----------------|
| Cash flow from Discontinued | | |
| Operations | 18,3 | 4,8 |
|---------------------------------+----------------+----------------|
| | | |
|---------------------------------+----------------+----------------|
| Change in cash and cash | | |
| equivalents | 1,1 | -15,7 |
|---------------------------------+----------------+----------------|
| | | |
|---------------------------------+----------------+----------------|
| | | |
|---------------------------------+----------------+----------------|
| Cash and cash equivalents at | | |
| the beginning of the period | 10,5 | 26,3 |
|---------------------------------+----------------+----------------|
| Cash and cash equivalents at | | |
| the end of the period | 11,3 | 10,5 |
|---------------------------------+----------------+----------------|
| | | |
|-------------------------------------------------------------------|
| Change in current loans during the financial period includes a |
| change in issued commercial paper of nominal value EUR 12.5 |
| million. |
+-------------------------------------------------------------------+
Consolidated
Statement of
Changes in
Equity
Equity attributable to equity holders of the
parent
In-
vested
Fair non-
va- re-
Sha- lue Trans- stric- Re- Mi-
Sha- re and la- ted Trea- tai- no- To-
re pre- other tion equi- sury ned rity tal
EUR capi- mium re- re- ty sha- ear- To- inte- equi-
million tal fund serve serve fund res nings tal rest ty
Equity at 1
Jan 2006 12,7 25,3 -1,6 1,5 -1,0 102,0 139,0 0,0 139,0
Restatement 5,3 5,3 5,3
Restated
equity at 1
Jan 2006 12,7 25,3 -1,6 1,5 -1,0 107,3 144,3 0,0 144,3
Cash flow
hedges, net
of tax:
Gains and
losses taken
to equity 1,4 1,4 1,4
Translation
differences -1,4 -1,4 0,0 -1,4
Gains and
losses from
hedge of net
investments
in foreign
operations,
net of tax 0,3 0,3 0,3
Profit for
the period 8,9 8,9 0,0 8,9
Total
recognised
income and
expense for
the period 1,4 -1,1 8,9 9,2 0,0 9,2
Dividends -13,4 -13,4 -13,4
Equity at 31
Dec 2006 12,7 25,3 -0,2 0,4 -1,0 102,8 140,1 0,0 140,1
Cash flow
hedges, net
of tax
Gains and
losses taken
to equity 0,3 0,3 0,3
Translation
differences -1,8 -1,8 0,0 -1,8
Gains and
losses from
hedge of net
investments
in foreign
operations,
net of tax 0,0 0,0 0,0
Share-based
payments 0,1 0,1 0,1
Profit for
the period 10,6 10,6 0,0 10,6
Total
recognised
income and
expense for
the period 0,3 -1,8 10,7 9,3 9,3
Dividends -7,1 -7,1 -7,1
Disposal of
treasury
shares 0,3 1,0 1,2 1,2
Acquisition
of treasury
shares -3,9 -3,9 -3,9
Equity at 31
Dec 2007 12,7 25,3 0,1 -1,3 0,3 -3,9 106,4 139,5 0,0 139,6
+-------------------------------------------------------------------+
| Glaston Group | | |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Segment-specific data | | |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Net sales, EUR million | 1-12/2007 | 1-12/2006 |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Pre-processing | 94,1 | 89,1 |
|-----------------------------------------+------------+------------|
| Heat Treatment | 162,3 | 131,3 |
|-----------------------------------------+------------+------------|
| Software Solutions | 14,7 | |
|-----------------------------------------+------------+------------|
| Parent company and eliminations | -1,3 | -1,5 |
|-----------------------------------------+------------+------------|
| Total | 269,8 | 218,9 |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Operating profit, excluding | | |
| non-recurring items, EUR million | 1-12/2007 | 1-12/2006 |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Pre-processing | 1,4 | 0,3 |
|-----------------------------------------+------------+------------|
| Heat Treatment | 19,6 | 13,5 |
|-----------------------------------------+------------+------------|
| Software Solutions | 2,6 | |
|-----------------------------------------+------------+------------|
| Parent company and eliminations | -7,0 | -3,0 |
|-----------------------------------------+------------+------------|
| Total | 16,6 | 10,9 |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Operating profit, excluding | | |
| non-recurring items, % | 1-12/2007 | 1-12/2006 |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Pre-processing | 1,5 % | 0,3 % |
|-----------------------------------------+------------+------------|
| Heat Treatment | 12,1 % | 10,3 % |
|-----------------------------------------+------------+------------|
| Software Solutions | 17,8 % | |
|-----------------------------------------+------------+------------|
| Glaston, total | 6,2 % | 5,0 % |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Net sales by market area, EUR million | 1-12/2007 | 1-12/2006 |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| EMEA | 150,5 | 126,1 |
|-----------------------------------------+------------+------------|
| America | 75,6 | 65,4 |
|-----------------------------------------+------------+------------|
| Asia | 43,7 | 27,5 |
|-----------------------------------------+------------+------------|
| Total | 269,8 | 218,9 |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Net sales by market area, % | 1-12/2007 | 1-12/2006 |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| EMEA | 55,8 % | 57,6 % |
|-----------------------------------------+------------+------------|
| America | 28,0 % | 29,9 % |
|-----------------------------------------+------------+------------|
| Asia | 16,2 % | 12,6 % |
|-----------------------------------------+------------+------------|
| Total | 100,0 % | 100,0 % |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Orders received, EUR million | 1-12/2007 | 1-12/2006 |
|-----------------------------------------+------------+------------|
| Pre-processing | 68,7 | 64,1 |
|-----------------------------------------+------------+------------|
| Heat Treatment | 141,0 | 131,4 |
|-----------------------------------------+------------+------------|
| Software Solutions | 3,0 | |
|-----------------------------------------+------------+------------|
| Total | 212,7 | 195,5 |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Order book, EUR million | 31.12.2007 | 31.12.2006 |
|-----------------------------------------+------------+------------|
| Pre-processing | 20,9 | 19,9 |
|-----------------------------------------+------------+------------|
| Heat Treatment | 59,9 | 77,9 |
|-----------------------------------------+------------+------------|
| Software Solutions | 6,2 | |
|-----------------------------------------+------------+------------|
| Total | 87,0 | 97,8 |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Personnel at end of period, Continuing | | |
| Operations | 31.12.2007 | 31.12.2006 |
|-----------------------------------------+------------+------------|
| Pre-processing | 556 | 590 |
|-----------------------------------------+------------+------------|
| Heat Treatment | 612 | 590 |
|-----------------------------------------+------------+------------|
| Software Solutions | 247 | |
|-----------------------------------------+------------+------------|
| Parent company | 20 | 9 |
|-----------------------------------------+------------+------------|
| Total | 1 435 | 1 189 |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Personnel, Discontinued Operations | | 22 |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Personnel, average, Continuing | | |
| Operations | 2007 | 2006 |
|-----------------------------------------+------------+------------|
| Pre-processing | 586 | 626 |
|-----------------------------------------+------------+------------|
| Heat Treatment | 608 | 606 |
|-----------------------------------------+------------+------------|
| Software solutions | 143 | |
|-----------------------------------------+------------+------------|
| Parent company | 13 | 8 |
|-----------------------------------------+------------+------------|
| Total | 1 350 | 1 241 |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Personnel, Discontinued Operations | | 23 |
+-------------------------------------------------------------------+
Calculation of key figures
Equity ratio, %=
Equity / x 100
Balance sheet total - advances received
Gearing, %=
Net interest-bearing liabilities / x 100
Equity
Net interest-bearing liabilities=
Interest-bearing liabilities - interest-bearing receivables -
cash and cash equivalents and other short-term investments
Return on equity (ROE), %=
Profit or loss for the period / x 100
Equity
Return on capital employed (ROCE), =
Profit before taxes + interest expenses / x 100
Interest-bearing liabilities + equity (average)
Earnings per share (EPS)=
Profit for the period attributable to equity holders of the parent /
Average number of shares for period excluding treasury shares
Equity per share
Equity /
Number of shares outstanding at end of period
+-------------------------------------------------------------------+
| | | |
|-----------------------------------------+------------+------------|
| | | Restated |
|-----------------------------------------+------------+------------|
| Key figures | 31.12.2007 | 31.12.2006 |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Number of shares, 1,000 | 79 350 | 79 350 |
|-----------------------------------------+------------+------------|
| - of which outstanding | 78 437 | 79 020 |
|-----------------------------------------+------------+------------|
| Return on capital employed, % | 12,1 | 8,8 |
|-----------------------------------------+------------+------------|
| Return on equity, % | 7,6 | 6,3 |
|-----------------------------------------+------------+------------|
| Equity ratio, % | 55,4 | 61,9 |
|-----------------------------------------+------------+------------|
| Gearing, % | 7,4 | -1,9 |
|-----------------------------------------+------------+------------|
| Investments in fixed assets, EUR | | |
| million | 34,1 | 12,0 |
|-----------------------------------------+------------+------------|
| Personnel at end of year | 1 435 | 1 211 |
|-----------------------------------------+------------+------------|
| Personnel, average | 1 350 | 1 264 |
|-----------------------------------------+------------+------------|
| Order book, Continuing Operations, EUR | | |
| million | 87,0 | 97,8 |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Key indicators per share | | |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Earnings per share, euros, Continuing | | |
| Operations | 0,09 | 0,05 |
|-----------------------------------------+------------+------------|
| Earnings per share, euros, Discontinued | | |
| Operations | 0,05 | 0,06 |
|-----------------------------------------+------------+------------|
| Earnings per share, euros, total | 0,14 | 0,11 |
|-----------------------------------------+------------+------------|
| Equity per share, euros | 1,78 | 1,77 |
|-----------------------------------------+------------+------------|
| Number of shares, 1,000 | 79 350 | 79 350 |
|-----------------------------------------+------------+------------|
| - of which outstanding | 78 437 | 79 020 |
|-----------------------------------------+------------+------------|
| Number of shares, average, 1,000 | 78 682 | 79 020 |
|-----------------------------------------+------------+------------|
| Share price trend, EUR | | |
|-----------------------------------------+------------+------------|
| Average price | 3,84 | 4,33 |
|-----------------------------------------+------------+------------|
| Lowest price | 2,70 | 3,75 |
|-----------------------------------------+------------+------------|
| Highest price | 4,53 | 4,84 |
|-----------------------------------------+------------+------------|
| Share price at the end of the year | 2,77 | 4,15 |
|-----------------------------------------+------------+------------|
| Market capitalisation of all shares at | | |
| the end | | |
|-----------------------------------------+------------+------------|
| of the year, EUR million | 219,8 | 329,3 |
|-----------------------------------------+------------+------------|
| Turnover, number of shares | 7 993 461 | 6 978 316 |
|-----------------------------------------+------------+------------|
| Turnover, EUR million | 31,2 | 30,2 |
|-----------------------------------------+------------+------------|
| Turnover, % of the total number | 10,1 | 8,8 |
|-----------------------------------------+------------+------------|
| Dividend per share, EUR | 0,10 | 0,09 |
|-----------------------------------------+------------+------------|
| Dividend per earnings, % | 71,4 | 81,8 |
|-----------------------------------------+------------+------------|
| Effective dividend yield, % | 3,6 | 2,2 |
|-----------------------------------------+------------+------------|
| P/E ratio | 19,8 | 37,7 |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Contingent liabilities, EUR million | 31.12.2007 | 31.12.2006 |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Company mortgages | 0,2 | 0,2 |
|-----------------------------------------+------------+------------|
| Other own liabilities | 6,1 | 5,6 |
|-----------------------------------------+------------+------------|
| | | |
|-----------------------------------------+------------+------------|
| Derivative contracts | | |
|-----------------------------------------+------------+------------|
| Values of the underlying instruments | | |
|-----------------------------------------+------------+------------|
| Currency derivatives | 13,2 | 17,3 |
|-----------------------------------------+------------+------------|
| Fair value | | |
|-----------------------------------------+------------+------------|
| Forward contracts | | |
|-----------------------------------------+------------+------------|
| Positive fair value | 0,1 | 0,3 |
|-----------------------------------------+------------+------------|
| Negative fair value | 0,0 | -0,1 |
+-------------------------------------------------------------------+
+-------------------------------------------------------------------+
| Glaston Group | | |
|------------------------------------+---------------+--------------|
| | | |
|------------------------------------+---------------+--------------|
| Discontinued Operations | | |
|------------------------------------+---------------+--------------|
| | | |
|------------------------------------+---------------+--------------|
| | | |
|------------------------------------+---------------+--------------|
| | 1-6/2007 | 1-12/2006 |
|------------------------------------+---------------+--------------|
| | | |
|------------------------------------+---------------+--------------|
| Result of Energy operations, | | |
| including profit on sale and taxes | | |
| arising from it | | |
|------------------------------------+---------------+--------------|
| | | |
|------------------------------------+---------------+--------------|
| Income | 24,2 | 38,8 |
|------------------------------------+---------------+--------------|
| Expenses | 19,0 | 32,4 |
|------------------------------------+---------------+--------------|
| Profit before taxes | 5,1 | 6,4 |
|------------------------------------+---------------+--------------|
| Income taxes | -1,3 | -1,7 |
|------------------------------------+---------------+--------------|
| Profit after taxes | 3,8 | 4,8 |
|------------------------------------+---------------+--------------|
| | | |
|------------------------------------+---------------+--------------|
| Impact of sale of Energy business | | |
| on Group's financial position | | |
|------------------------------------+---------------+--------------|
| | | |
|------------------------------------+---------------+--------------|
| Book values of sold balance sheet | | |
| items | | |
|------------------------------------+---------------+--------------|
| Tangible assets | 13,8 | |
|------------------------------------+---------------+--------------|
| Intangible rights | 0,1 | |
|------------------------------------+---------------+--------------|
| Inventories | 0,2 | |
|------------------------------------+---------------+--------------|
| Short-term liabilities | -0,1 | |
|------------------------------------+---------------+--------------|
| Assets and liabilities, total | 14,0 | |
|------------------------------------+---------------+--------------|
| | | |
|------------------------------------+---------------+--------------|
| Expenses attributable to sales | 0,3 | |
|------------------------------------+---------------+--------------|
| | | |
|------------------------------------+---------------+--------------|
| Profit on sale before taxes | 1,0 | |
|------------------------------------+---------------+--------------|
| Considerations, total | 15,3 | |
|------------------------------------+---------------+--------------|
| | | |
|------------------------------------+---------------+--------------|
| Consideration received in cash | 10,6 | |
|------------------------------------+---------------+--------------|
| Expenses attributed to sales | 0,3 | |
|------------------------------------+---------------+--------------|
| Cash flow from sale | 10,4 | |
|------------------------------------+---------------+--------------|
| | | |
|------------------------------------+---------------+--------------|
| | | |
|-------------------------------------------------------------------|
| From the sale price was recognised a EUR 4.7 million receivable |
| relating to the sale of future emission rights. |
|-------------------------------------------------------------------|
| The estimated time of realisation of the receivable is 2008-2012. |
|-------------------------------------------------------------------|
| | | |
|-------------------------------------------------------------------|
| Long-term asset items classified as being held for sale and their |
| related liabilities |
|-------------------------------------------------------------------|
| | | |
|------------------------------------+---------------+--------------|
| Long-term asset items held for | | |
| sale | | |
|------------------------------------+---------------+--------------|
| Tangible assets | 0,3 | |
|------------------------------------+---------------+--------------|
| | | |
|-------------------------------------------------------------------|
| Long-term asset items classified as being held for sale are |
| connected with the parent company's apartment block company |
| units. |
+-------------------------------------------------------------------+
+----------------------------------------------------------------------------+
|Quarterly information | | | | | | | |
|-------------------------------------+----+----+-----+----+-----+-----+-----|
| | | | | | | | | |
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
| | | | | | | | | |
|----------------------------------------------------------------------------|
|Restated net sales, operating result and order book for |
|----------------------------------------------------------------------------|
|Continuing Operations, EUR million | | | | |
|-----------------------------------------------------+----+-----+-----+-----|
| | | | | | | | | |
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
| | 1-3| 4-6| 7-9|10-12| 1-3| 4-6| 7-9|10-12|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Net sales | /06| /06| /06| /06| /07| /07| /07| /07|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Pre-processing |20,3|21,2|20,9| 26,6|21,7| 23,4| 20,6| 28,5|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Heat Treatment |25,6|31,6|35,5| 38,6|36,6| 42,7| 30,2| 52,8|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Software Solutions | | | | | | | 6,8| 7,9|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Parent company and eliminations | 0,0|-0,1|-0,1| -1,2|-0,1| -0,5| -0,3| -0,5|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Total |45,9|52,7|56,3| 64,0|58,2| 65,6| 57,3| 88,8|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
| | | | | | | | | |
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
| | | | | | | | | |
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Operating | | | | | | | | |
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|result | | | | | | | | |
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|excluding | | | | | | | | |
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|non-recurring | 1-3| 4-6| 7-9|10-12| 1-3| 4-6| 7-9|10-12|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|items | /06| /06| /06| /06| /07| /07| /07| /07|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Pre-processing |-0,8| 0,3| 0,4| 0,4| 1,2| -0,2| 0,3| 0,2|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Operating result % |-4,0| 1,5| 1,8| 1,5| 5,3| -0,9| 1,3| 0,8|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Heat Treatment | 0,6| 3,9| 4,0| 5,1| 3,0| 5,7| 3,2| 7,7|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Operating result % | 2,3|12,3|11,4| 13,1| 8,1| 13,4| 10,5| 14,6|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Software Solutions | | | | | | | 1,6| 1,0|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Operating result % | | | | | | | 23,1| 13,2|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Parent company and eliminations |-1,0|-1,1|-0,9| 0,0|-2,4| -1,7| -1,1| -1,8|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Total |-1,2| 3,1| 3,5| 5,5| 1,7| 3,8| 4,0| 7,1|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Operating result % |-2,7| 5,9| 6,2| 8,6| 2,9| 5,8| 6,9| 8,0|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
| | | | | | | | | |
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
| | 1-3| 4-6| 7-9|10-12| 1-3| 4-6| 7-9|10-12|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Operating result | /06| /06| /06| /06| /07| /07| /07| /07|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Pre-processing |-0,8| 0,3|-0,5| -2,7| 1,2| -1,6| 0,3| 0,3|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Operating result % |-4,0| 1,5|-2,2|-10,1| 5,3| -7,0| 1,3| 0,9|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Heat Treatment |-0,1| 3,9| 3,8| 4,6| 3,0| -0,2| 3,2| 7,7|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Operating result % |-0,3|12,3|10,8| 12,0| 8,1| -0,4| 10,6| 14,6|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Software Solutions | | | | | | | 1,6| 1,0|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Operating result % | | | | | | | 23,1| 13,2|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Parent company and eliminations |-1,0|-1,1|-0,9| 0,0|-2,4| -1,8| -1,1| 0,9|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Total |-1,9| 3,1| 2,5| 1,9| 1,7| -3,6| 4,0| 9,9|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Operating result % |-4,1| 5,9| 4,4| 3,0| 2,9| -5,4| 6,9| 11,2|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
| | | | | | | | | |
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
| | 03/| 06/| 09/| 12/| 03/| 06/| 09/| 12/|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Order book | 06| 06| 6,0| 06| 07| 07| 07| 07|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Pre-processing |17,8|22,1|20,2| 19,9|20,2| 25,9| 24,4| 20,9|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Heat Treatment |51,6|59,7|73,6| 77,9|72,3| 95,7| 92,6| 59,9|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Software Solutions | | | | | | | 8,6| 6,2|
|--------------------------------+----+----+----+-----+----+-----+-----+-----|
|Total |69,4|81,8|93,8| 97,8|92,5|121,6|125,7| 87,0|
+----------------------------------------------------------------------------+
Accounting principles
The financial statements have been prepared in accordance with the
principles of recognition and valuation of the IFRS standards.
On 1 January 2007, the Group introduced the IFRS 7 standard Financial
instruments: Disclosures in the Financial Statements, an amendment to
the IAS 1 Standard relating to Presentation of Financial Statements -
Capital Disclosures.
The proportion of the Group's net sales accounted for by glass
processing machines tailored to customers' wishes and sold as
comprehensive deliveries has grown significantly, and for this reason
the Group as of 1 January 2007 recognises their delivery on the basis
of degree of completion of the delivery in accordance with IAS 11
Standard Construction Contracts. Comparison data have been restated
to correspond with the new recognition practice.
The purchase cost calculation for Albat+Wirsam shares
Through an agreement signed on 2 July 2007, Glaston Corporation
acquired all of the shares of A+W Software AG GroupA+W Group is the
world's leading company in production management and reporting (ERP)
software for the flatglass, window and door industries.
The purchase price paid by Glaston Corporation was a total of EUR
21.2 million, of which a sum of EUR 0.9 million represents a
discounted portion of an additional purchase price payable within two
years. The final acquisition costof the shares is EUR 21.8 million,
including expert fees amounting to EUR 0.6 million. The
goodwill/acquisition cost of the acquired business may change on the
basis of terms and conditions relating to the purchase price of the
bill of sale.
In a business combination, tangible fixed assets are valued at fair
value based on the market prices of similar assets, taking into
consideration the age and condition of the assets and other
corresponding factors. Tangible assets are depreciated over their
useful life based on a management estimate in accordance with the
Group's depreciation principles.
Intangible assets acquired in a business combination are recognised
separately from goodwill at fair value at the time of acquisition, if
the fair value of the asset can be determined reliably. In the
acquired business, the Group has acquired identifiable intangible
assets mainly in the form of product rights and an order book of
technology deliveries.
From the acquisition cost a fair value of EUR 6.5 million was
attributed to the product rights and order book. Fair value has been
determined using the Multi-period Excess Earnings (MEEM) method. The
useful life is five years.
The deal includes goodwill amounting to EUR 14.2 million. The
creation of goodwill is based on expert personnel, expected synergy
benefits and the good profitability of the acquired business.
A+W Software AG Group's net sales of six months, EUR 14.7 million,
are included in consolidated net sales in 2007. Management estimates
that consolidated net sales in 2007 would have been around EUR 282
million, if this company acquisition had been completed on 1 January
2007.
The values of the acquired assets and the received liabilities at the
date of acquisition were as follows
+-------------------------------------------------------------------+
| | Fair values | Book values |
| | recognised in | before |
| EUR million | combination | combination |
|-------------------------------------+---------------+-------------|
| Tangible assets | 0,8 | 0,8 |
|-------------------------------------+---------------+-------------|
| Other intangible assets | 6,5 | |
|-------------------------------------+---------------+-------------|
| Investments | 0,3 | 0,3 |
|-------------------------------------+---------------+-------------|
| Inventories | 0,3 | 0,3 |
|-------------------------------------+---------------+-------------|
| Interest-free receivables | 8,7 | 8,7 |
|-------------------------------------+---------------+-------------|
| Financial assets | 3,8 | 3,8 |
|-------------------------------------+---------------+-------------|
| Other interest-free liabilities | -12,9 | -12,7 |
|-------------------------------------+---------------+-------------|
| Acquired net assets | 7,5 | 1,2 |
|-------------------------------------+---------------+-------------|
| | | |
|-------------------------------------+---------------+-------------|
| Acquisition price | 21,2 | |
|-------------------------------------+---------------+-------------|
| Expenses related to acquisition | 0,6 | |
|-------------------------------------+---------------+-------------|
| Goodwill | 14,2 | |
|-------------------------------------+---------------+-------------|
| | | |
|-------------------------------------+---------------+-------------|
| Acquisition price paid as cash | 20,2 | |
|-------------------------------------+---------------+-------------|
| Expenses related to acquisition | 0,6 | |
|-------------------------------------+---------------+-------------|
| Cash and cash equivalents of | | |
| acquired companies | -3,8 | |
|-------------------------------------+---------------+-------------|
| Cash flow impact | 17,0 | |
|-------------------------------------+---------------+-------------|
| | | |
|-------------------------------------------------------------------|
| The purchase price allocation is preliminary. |
+-------------------------------------------------------------------+
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