Etteplan Oyj - Interim report (Q1 and Q3)

Etteplan Q2: Profitability improved

ETTEPLAN OYJ, INTERIM REPORT, AUGUST 13, 2014 AT 02.00 P.M.


ETTEPLAN Q2: PROFITABILITY IMPROVED

Review period April-June 2014

- The Group's revenue decreased by 1.5% and was EUR 33.7 million
  (4-6/2013: EUR 34.2 million).
- EBITDA improved by 10.9% and was EUR 2.9 million (EUR 2.6 million).
- Operating profit (EBIT) improved by 16.3% and was EUR 2.3 million (EUR 2.0
million). 
- The profit for the review period was EUR 1.8 million (EUR 1.6 million).
- Operating cash flow improved and was EUR 3.1 million (EUR 1.0 million).
- Earnings per share were EUR 0.09 (EUR 0.08).
- The Group had 1,843 employees at the end of the period (1,742).
- Etteplan keeps its financial guidance unchanged and adjusts the estimate of
  its market outlook.

Review period January-June 2014

- The Group's revenue decreased by 2.4% and was EUR 67.0 million
  (1-6/2013: EUR 68.7 million).
- EBITDA declined by 7.1% and was EUR 4.7 million (EUR 5.1 million).
- Operating profit (EBIT) decreased by 7.6% and was EUR 3.4 million (EUR 3.7
million). 
- The profit for the review period was EUR 2.6 million (EUR 2.7 million).
- Operating cash flow improved and was EUR 1.4 million (EUR -0.9 million).
- Earnings per share were EUR 0.13 (0.13).

Outlook 2014

Market outlook

The most important factor in the development of Etteplan's business is the
development of the machinery and metal industry. Despite increased new orders
from the machinery and metal industry, the market has become more uncertain and
business less predictable. 

Financial guidance

We expect the revenue and operating profit for the year 2014 to grow compared
to 2013. 

Previous estimate of outlook

Market outlook

The most important factor in the development of Etteplan's business operations
is the development of business operations in the machinery and metal industry.
At the beginning of 2014, the revenues and order books of the machinery and
metal industry were at a lower level than in the corresponding period in 2013.
However, new orders increased on average. The demand for engineering design
services showed signs of recovery at the end of the review period, but the
full-year development remains uncertain. 

Financial guidance

We expect the revenue and operating profit for the year 2014 to grow compared
to 2013. 

Key figures

(EUR 1,000)                    4-6/2014  4-6/2013  1-6/2014  1-6/2013  1-12/2013
--------------------------------------------------------------------------------
Revenue                          33,737    34,240    67,019    68,699    128,647
EBITDA                            2,920     2,632     4,730     5,090      9,064
EBITDA, %                           8.7       7.7       7.1       7.4        7.0
Operating profit (EBIT)           2,273     1,954     3,430     3,712      6,366
EBIT, %                             6.7       5.7       5.1       5.4        4.9
Basic earnings per share, EUR      0.09      0.08      0.13      0.13       0.22
Equity ratio, %                    33.7      31.7      33.7      31.7       35.9
Operating cash flow               3,058     1,022     1,363      -938      1,789
ROCE, %                            20.7      18.3      15.5      16.8       14.6
Personnel at end of the           1,843     1,742     1,843     1,742      1,728
 period                                                                         

Juha Näkki, President and CEO of Etteplan Oyj comments on the interim report:

“Due to our strong market position and the recovery in demand at the end of the
first quarter we were able to turn our business back to growth in the end of
the review period. Our operating profit improved compared to the second quarter
of 2013 and nearly doubled compared to the first quarter of 2014. Our cash flow
improved significantly. Our revenue ceased to decrease and was slightly better
than in the comparison period at comparable exchange rates. The number of
temporary layoffs continued to decrease in Finland in the second quarter. Sales
to key customers developed more favorably than other business operations. 

In Europe, the demand for engineering design services and technical
documentation improved in the review period, particularly in the projects of
forest industry equipment manufacturers, while also showing signs of
improvement in other sectors. Overall demand improved slightly in Finland and
the Netherlands. In Sweden, demand recovered faster than in Finland and the
Netherlands, but the competitive situation remained tight. 

In China, the engineering design service market continued to develop favorably.
During the review period, we managed to increase the number of working hours
invoiced in the Chinese market by nearly 170 per cent, and our number of
employees in China exceeded 200. Our acquisition of Elomatic's engineering
business in China and the outsourcing of MacGregor's engineering design
operations had a positive effect on our operations in China. Offshoring
services outside China continued to grow as well. I am very pleased with the
development in China in the first half of 2014, and we will continue to carry
out measures to maintain growth. 

The implementation of our business strategy is progressing as planned. High
value-added Managed Services constituted more than one-third of our revenue.
Our service products, offering cost savings to customers, are ideal for the
prevailing market situation, and we received significant orders during the
review period. In technical documentation, the earlier outsourcing carried out
by Fortum Värme was followed by the outsourcing of technical documentation by
Fortum Hydro to Etteplan in Sweden. Interest in our technical documentation and
outsourcing solutions has clearly increased, and we are negotiating outsourcing
cases with several customers. 

During the review period, Etteplan adjusted its growth target upward to 15 per
cent. The target includes both organic growth and acquisitions. We are back on
the growth track, and the market situation is favorable for acquisitions. With
determined work, I believe we will reach our new growth target in 2015. 

Despite slow growth and the uncertainty in Europe created by the situation in
Russia, our financial guidance for 2014 remains unchanged.” 

Disclosure procedure

Etteplan follows the disclosure procedure enabled by Disclosure obligation of
the issuer (7/2013) published by the Finnish Financial Supervision Authority.
This stock exchange release is a summary of Etteplan's January-June 2014
interim report. The complete interim report is attached to this stock exchange
release in pdf format and is also available on Etteplan's website at
www.etteplan.com. Investors are advised to review the complete interim report
with tables. 

Conference call and live webcast today, August 13, 2014

Etteplan's President and CEO Juha Näkki will present Company's results for
January-June 2014 in a conference call and a live webcast for analysts and
investors, held in English language, on August 13, 2014 starting at 3.30 p.m.
Finnish time (EET). 

To participate in the conference call please dial 5-10 minutes prior to the
start of the conference to +358 9 2319 5437, event password is Etteplan2014.
Questions can be asked in English after President and CEO's presentation only
through conference call connection. 

Juha Näkki's presentation can be followed as a live webcast through a link at
Etteplan's homepage at www.etteplan.com/Investors. The live webcast starts at
3.30 p.m. Finnish time (EET). 

A recording of the webcast will be later available at the same address.

Vantaa, August 13, 2014

Etteplan Oyj

Board of Directors


Additional information:
Juha Näkki, President and CEO, tel. +358 400 606 372


The information presented herein has not been audited.


Releases and other corporate information are available on Etteplan's Web site
at www.etteplan.com. 


DISTRIBUTION:
NASDAQ OMX Helsinki
Major media
www.etteplan.com


Etteplan provides engineering planning services and technical product
information solutions to the world's leading companies in the manufacturing
industry. Our services are geared to improve the competitiveness of our
customers' products and engineering processes throughout the product life
cycle. The results of Etteplan's innovative engineering can be seen in numerous
industrial solutions and everyday products. 

In 2013, Etteplan had a turnover of EUR 128.6 million. The company has more
than 1,800 professionals in Finland, Sweden, the Netherlands and China.
Etteplan's shares are listed on NASDAQ OMX Helsinki Ltd under the ticker ETT1V.

Attachments:

Etteplan_Q2_2014_EN.pdf