Vacon - Interim report (Q1 and Q3)

Vacon Plc Interim Report 1 January - 30 September 2011

Vacon Plc, Stock Exchange Release, 25 October 2011 at 9.30 am

In this stock exchange release Vacon is publishing information included in the
interim report that has a significant impact on the value of securities. The
full interim report is in the appendix to this release and can be downloaded
from the company's website in Finnish at www.vacon.fi and in English at
www.vacon.com.



July-September summary:

  * Order intake totalled MEUR 83.9, a decline of 24.4 % from the corresponding
    period in the previous year (MEUR 110.9).
  * Revenues totalled MEUR 91.1, growth of 2.0 % (MEUR 89.3).
  * Operating profit was MEUR 8.2 or 9.1 % of revenues, a decline of 0.5 % (MEUR
    8.3 and 9.3 %).
  * Net cash flow from operating activities was MEUR 19.8 (MEUR 6.6).
  * Earnings per share were EUR 0.36 (EUR 0.31), growth of 14.4 %.



January-September summary:

  * Order intake totalled MEUR 288.4, growth of 4.6 % from the corresponding
    period in the previous year (MEUR 275.7).
  * Revenues totalled MEUR 293.2, growth of 24.9 % (MEUR 234.8).
  * Operating profit was MEUR 28.6 or 9.8 % of revenues, an increase of 46.6 %
    (MEUR 19.5 and 8.3 %).
  * Net cash flow from operating activities was MEUR 20.6 (MEUR 14.3).
  * Earnings per share were EUR 1.29 (EUR 0.76), growth of 69.7 %.



Key indicators

+-------------------+------------+------------+---------------+
|MEUR               |7-9/2011    |7-9/2010    |Change, %      |
+-------------------+------------+------------+---------------+
|Order intake       |83.9        |110.9       |-24.4 %        |
+-------------------+------------+------------+---------------+
|Revenues           |91.1        |89.3        |2.0 %          |
+-------------------+------------+------------+---------------+
|Operating profit   |8.2         |8.3         |-0.5 %         |
+-------------------+------------+------------+---------------+
|% of revenues      |9.1 %       |9.3 %       |               |
+-------------------+------------+------------+---------------+
|Profit before taxes|7.8         |7.3         |               |
+-------------------+------------+------------+---------------+




+---------------------------------------+--------+--------+---------+---------+
|MEUR                                   |1-9/2011|1-9/2010|Change, %|1-12/2010|
+---------------------------------------+--------+--------+---------+---------+
|Order intake                           |288.4   |275.7   |4.6 %    |358.2    |
+---------------------------------------+--------+--------+---------+---------+
|Order book                             |47.3    |72.9    |-35.1 %  |52.1     |
+---------------------------------------+--------+--------+---------+---------+
|Revenues                               |293.2   |234.8   |24.9 %   |338.0    |
+---------------------------------------+--------+--------+---------+---------+
|Operating profit                       |28.6    |19.5    |46.6 %   |28.6     |
+---------------------------------------+--------+--------+---------+---------+
|% of revenues                          |9.8 %   |8.3 %   |         |8.5 %    |
+---------------------------------------+--------+--------+---------+---------+
|Profit before taxes                    |28.4    |18.1    |         |27.5     |
+---------------------------------------+--------+--------+---------+---------+
|Net cash flow from operating activities|        |        |         |         |
|                                       |20.6    |14.3    |         |15.9     |
+---------------------------------------+--------+--------+---------+---------+
|Earnings per share, EUR                |        |        |         |         |
|                                       |1.29    |0.76    |         |1.22     |
+---------------------------------------+--------+--------+---------+---------+
|Interest-bearing net liabilities       |        |        |         |         |
|                                       |13.4    |8.4     |         |9.8      |
+---------------------------------------+--------+--------+---------+---------+
|Gearing, %                             |10.8 %  |10.1 %  |         |10.7 %   |
+---------------------------------------+--------+--------+---------+---------+
|Gross capital expenditure              |        |        |         |         |
|                                       |13.7    |12.1    |         |15.9     |
+---------------------------------------+--------+--------+---------+---------+


General review

Vacon estimates that growth in the global AC drive market levelled off in the
third quarter of 2011 in all market areas compared to the extremely strong first
half of the year.

Demand for AC drives was evenly divided among all industrial sectors, except for
renewable energy and in particular wind power. In China the new regulations
imposed on wind power have temporarily reduced wind power investments in that
country. One positive aspect, however, is that Vacon's clients who sell wind
power solutions to China are able to comply with the new official regulations.
This ensures Vacon a strong competitive position when wind power investments in
China pick up.

Vacon's revenues grew 2.0 % in the July - September period, to EUR 91.1 (89.3)
million. In January - September revenues rose 24.9 %, to EUR 293.2 (234.8)
million. Operating profit declined to EUR 8.2 million in July - September, or
9.1 % of revenues (EUR 8.3 million and 9.3 %). Operating profit rose to EUR
28.6 million in January - September, or 9.8 % of revenues (EUR 19.5 million and
8.3 %).

The main reason for the slow down in the growth in revenues in the third quarter
was the poor order intake for products for renewable energy generation. Demand
for Vacon's wind power products in particular has been weak specifically due to
the temporary decline in the Chinese wind power market. Demand for Vacon's
products for controlling electric motors in the third quarter has been similar
to what it was in the first half of the year. Developments in revenues vary from
one country to another, but a slow down in growth can be seen on all continents.

Order intake by Vacon in the third quarter totalled EUR 83.9 (110.9) million.
The main reason for this decline is the poor demand for products for renewable
energy generation. The figures for the third quarter of 2010 include an
exceptionally high number of orders for solar energy products.

Prospects for 2011

Vacon still estimates that the AC drive market will grow 6-10 % in 2011, thanks
to the strong performance in the first half of the year. Vacon does not expect
demand to grow significantly in the final quarter of 2011 compared to the strong
first half of the year. Vacon also does not expect demand for products for wind
power production to pick up significantly yet in 2011. The risks to overall
economic growth prospects in Europe and North America came to a head in the
third quarter of 2011. Vacon considers that overall economic growth prospects
are exposed to risks. Vacon is launching several new products towards the end of
2011 and in the first half of 2012, which creates good potential for the company
to increase its business even in a challenging market environment.

Market guidelines for 2011

Vacon estimates that revenues in 2011 will increase 10 - 20 % and the operating
profit margin will rise from 2010. Earnings per share are expected to improve
considerably from 2010.

Formal statement

This release contains certain forward-looking statements that reflect the
current views of the company's management. Due to the nature of these
statements, they contain risks and uncertainties and are subject to changes in
the general economic situation and in the company's business sector.

Vacon in brief

Vacon's operations are driven by a passion to develop, manufacture and sell the
best AC drives in the world - and nothing else. AC drives are used to control
electric motors and in renewable energy generation. Vacon has R&D and production
units in Finland, the USA, China and Italy, and sales offices in 27 countries.
In 2010 Vacon had revenues of EUR 338.0 million and globally employed 1300
people. The shares of Vacon Plc (VAC1V) are quoted on the main list of the
Helsinki stock exchange.


Driven by Drives, www.vacon.com

Vantaa, 25 October 2011
VACON PLC
Board of Directors



For more information please contact:

  * Mr Vesa Laisi, President and CEO, phone: +358 (0)40 8371 510
  * Ms Eriikka Söderström, CFO and Vice President, Finance & Control, phone:
    +358 (0)40 8371 445

Conference for media and analysts

Vacon will hold a briefing for analysts and the media at 11.30 am on 25 October
2011 at the Scandic Simonkenttä Hotel, Simonkatu 9, 00100 Helsinki. The briefing
will be in Finnish.

Dial-in conference for investors and investment analysts

An international dial-in conference for investors and investment analysts will
be held at 3.00 pm on 25 October 2011. President and CEO Vesa Laisi and Eriikka
Söderström, CFO and Vice President, Finance and Control, will participate in the
conference. Lines can be booked ten minutes before the conference by calling the
service number +358(0)9 2310 1620 (Finland) or +44 (0)20 3364 5381 (UK). The
conference ID code is 8441413.

To hear a recording of the conference, available for seven working days, call
+358 (0)9 2310 1650 (Finland) or +44 (0)20 7111 1244 (UK), ID code 8441413#.

Conference link: http://www.media-server.com/m/p/rux9zesj

The presentation material will be available before the media briefing on Vacon's
website at:

 www.vacon.com -> Investors

DISTRIBUTION:

NASDAQ OMX Helsinki
Financial Supervisory Authority
Main Media


[HUG#1557510]

Attachments:

Vacon Q3 2011 Results Presentation.pdf

Vacon Plc Interim Report 1 January-30 September 2011.pdf