Raute - Interim report (Q1 and Q3)

Raute Corporation's interim report January 1-March 31, 2024: Good progress in project deliveries in challenging market environment

RAUTE CORPORATION, INTERIM REPORT, MAY 3, 2024, AT 09:00 A.M.

Raute Corporation's interim report January 1-March 31, 2024: Good progress in
project deliveries in challenging market environment

This is a summary of Raute's Interim financial report January 1-March 31, 2024.
The complete report is attached to this release as a pdf file and is also
available on the company's' website at www.raute.com.

RAUTE CORPORATION - INTERIM REPORT JANUARY 1-MARCH 31, 2024

January−March 2024

-          Order intake was EUR 36 million (67)

-          Order book was EUR 259 million (121) at the end of the reporting
period

-          Net sales were EUR 44.7 million (36.8)

-          Comparable EBITDA was EUR 3.0 million (2.8), representing 6.7% (7.7)
of net sales

-          Operating profit was EUR 1.5 million (0.9)

-          Earnings per share were EUR 0.20 (0.10)

-          Equity ratio was 49.7% (41.4)

KEY FIGURES         1.1.-31.3.2024  1.1.-31.3.2023  1.1. -31.12.2023
Net sales, MEUR     44.7            36.8            145.4
Change in net       21.4            -4.5            -8.2
sales, %
Comparable EBITDA,  3.0             2.8             9.3
MEUR
Comparable EBITDA,  6.7             7.7             6.4
%
Operating profit,   1.5             0.9             1.9
MEUR
Operating profit,   3.3             2.3             1.3
% of net sales
Profit for the      1.3             0.8             1.4
period, MEUR
Profit for the      2.8             2.2             0.9
period, % of net
sales

Gross capital       0.4             0.9             4.5
expenditure, MEUR
% of net sales      0.9             2.4             3.1

Research and        1.4             1.3             5.2
development costs,
MEUR
% of net sales      3.2             3.5             3.6

Order book, MEUR    259             121             266
Order intake, MEUR  36              67              315

Personnel, at the   775             733             754
end of the period
Personnel,          772             707             749
effective, on
average
Personnel, on       770             751             754
average

President and CEO Mika Saariaho: Solid start for the year in Wood Processing and
Services business units

We had a good start to the year with solid progress in project deliveries
supported by our all-time high order book. However, the market environment
remained uncertain as many of our customers were in a wait-and-see mode in
relation to making firm investment decisions.

In the first quarter, comparable EBITDA developed in line with our expectations
and was EUR 3.0 million, representing a margin of 6.7%. The result indicates
improved efficiency of the underlying operations while considering that the
comparison figure was positively impacted by the release of provisions related
to the wind-down of the Russian operations.

I am particularly pleased with the performance of the Services business unit,
where we have also developed a concept for performance-based maintenance
offering. In the first quarter, we announced an agreement with Paged Group of
Estonia. It is an excellent example of this concept, where we take full
maintenance responsibility for the customer's production machinery, including
spare parts, small upgrades, and process improvement work, to support the
customer in ensuring optimized production.

The Wood Processing business also improved its performance by making good
progress in the project deliveries of the mill-sized orders won last year.
Meanwhile, Analyzers had a disappointing quarter due to the timing and delays of
some deliveries. On the Group level, our costs were at a more normalized level
after being elevated in the last quarter of 2023.

The political strikes in Finland had an impact on the operations of our main
production site in Lahti. With good preparations we were able to mitigate the
impacts of the strikes for the most part. However, there still was some negative
impact on net sales and profitability.

Order intake in the first quarter was rather modest, excluding the mill-sized
order received from Latvia's AmberBirch, and mainly consisted of service and
modernization projects. Nevertheless, we can be very happy to have received yet
another complete mill-sized order. This continues to demonstrate our strong
offering and the continuous customer interest in these solutions over the
business cycle, driven by sustainability needs.

Given our nearly record-high order book, we are in a good position to continue
implementing Raute's growth strategy. We believe that Raute has a unique
opportunity to capture new business opportunities in engineered wood product
segments by combining our offering into innovative production solutions, powered
by data and digital tools. In line with our newly announced values, we aim to
Show the Way - Drive Change for positive development in our industry together
with our customers. We will do this together as one team with our dedicated and
skilled personnel.

BUSINESS ENVIRONMENT

The market uncertainty continued in January-March 2024. Although some weak
signals of a slowly improving market sentiment might be seen, especially the
demand for both hardwood and softwood plywood was at a modest level and pricing
under pressure. The demand for LVL has remained more stable. This was reflected
in the demand for Raute's customers' products.

While inflation has stabilized, the high interest rates and the overall economic
uncertainty have slowed down the demand for the traditional end-product
consuming industries such as construction and commercial vehicle production.
Also, illegal Russian birch plywood with clearly lower prices entering the
European market despite the sanctions affects the European birch plywood
producers.

The impact of the lower end-product demand is clearly visible in Raute's
customers' investment activity, which is mainly focusing on keeping the existing
production facilities running. While this supports Raute's after-sales business,
it clearly has a negative impact on the demand for new production lines and
modernizations.

The highlight of the first quarter for Raute was the EUR 20 million order for a
greenfield veneer mill machinery from AmberBirch in Latvia. This is again a good
example of a long-term Raute customer investing in increasing their production
capacity over the economic cycles.

GUIDANCE STATEMENT FOR 2024

Raute reiterates its guidance statement for 2024. Raute's 2024 net sales are
expected to be between EUR 170-195 million and comparable EBITDA between EUR
10-14 million.

RAUTE CORPORATION
Board of Directors

BRIEFING

A briefing is organized for analysts, investors, and the media on May 3, 2024,
at 2:00 p.m. at Scandic Simonkenttä Hotel, Simonkatu 9, Helsinki, Finland. The
report is presented by President and CEO Mika Saariaho and CFO Ville Halttunen.
The presentation language is Finnish. The event can also be followed online via
Teams. Link will be sent to those who have registered by email; registrations at
ir@raute.com. The event will be recorded, and the recording can be viewed on
Raute's website at www.raute.com on May 7, 2024, at the latest.

NEXT INTERIM REPORT:
Raute Corporation's half-year financial report January 1-June 30, 2024, will be
published on Thursday August 8, 2024.

FURTHER INFORMATION:
Mr. Mika Saariaho, President and CEO, tel. +358 40 154 9393
Mr. Ville Halttunen, CFO, tel. +358 50 3460868

DISTRIBUTION:
Nasdaq Helsinki Ltd, Main media, www.raute.com

RAUTE IN BRIEF - Making Wood Matter
Raute is the partner to future-proof the wood industry. Our technologies cover
different production processes with supporting digital and analytics solutions
for engineered wood products. Additionally, we offer a full-scale service
concept ranging from spare parts to regular maintenance and modernizations. Our
innovative hardware and software solutions are designed to support our
customers' efficient consumption of natural resources. In mill-scale projects,
Raute is a global market leader both in the plywood and LVL industries. Raute's
head office and main production plant are located in Lahti, Finland. The
company's other production plants are located in Kajaani, Finland, the Vancouver
area of Canada, Changzhou, China, and in Pullman, WA, USA. Raute's net sales in
2023 were EUR 145.4 million. The Group's headcount at the end of 2023 was 754.
More information about the company can be found at www.raute.com.

Attachments:

05032934.pdf