Etteplan Oyj - Interim report (Q1 and Q3)

ETTEPLAN Q1: GROWTH CONTINUED

ETTEPLAN OYJ, INTERIM REPORT, APRIL 28, 2016 AT 02.00 P.M.


ETTEPLAN Q1: GROWTH CONTINUED

Review Period January-March 2016

- The Group’s revenue increased by 11.4% and was EUR 38.6 million (1-3/2015:
EUR 34.7 million). At comparable exchange rates revenue increased by 11.2%. 
- EBIT from business operations was EUR 2.2 million (EUR 2.3 million), or 5.6%
(6.5%) of revenue. 
- Operating profit (EBIT) was EUR 1.9 million (EUR 2.1 million), or 4.9% (5.9%)
of revenue. 
- The profit for the review period was EUR 1.5 million (EUR 1.4 million).
- Operating cash flow was EUR -1.7 million (EUR 0.1 million).
- Earnings per share were EUR 0.07 (EUR 0.07).
- The number of personnel increased and the Group had 2,080 employees at the
end of the review period (1,873). 
- Etteplan extended its service concept into industrial internet solutions by
acquiring the entire share capitals of Espotel Oy and Soikea Solutions Oy. The
acquisitions were announced on March 15, 2016, and the transactions were
finalized after the review period on April 4, 2016, at which time the acquired
companies’ business operations were transferred to Etteplan. The business
operations of the acquired companies are consolidated in Etteplan’s group
reporting from April 1, 2016. 
- Etteplan's Board of Directors is planning a rights issue of approximately EUR
14 million to finance the acquisitions. The rights issue is estimated to take
place in the second quarter of 2016. 
- Etteplan keeps its estimate of market outlook and financial guidance
unchanged. 

Market Outlook

The most important factor in the development of Etteplan's business is the
global development of the machinery and metal industry. In 2016, there are
signs of improvement of European growth. Uncertainty has increased in the
Finnish market, and the market situation is expected to remain weaker than in
the rest of Europe. In spite of the slowing down of growth in Asian markets and
increased uncertainty, the service market development is expected to continue.
We expect that the good market situation in North America will continue. The
demand for engineering services and technical documentation services got off to
a slow start at the beginning of the year. 

Financial Guidance

We expect the revenue and operating profit for the full year 2016 to grow
significantly compared to 2015. 

Key figures                                                    
                                                               
(EUR 1,000)                       1-3/2016  1-3/2015  1-12/2015
---------------------------------------------------------------
Revenue                             38,603    34,650    141,143
EBIT from business operations*       2,178     2,254      9,540
EBIT from business operations, %       5.6       4.9        5.6
Operating profit (EBIT)              1,896     2,051      8,594
EBIT, %                                4.9       5.4        6.0
Basic earnings per share, EUR         0.07      0.07       0.31
Equity ratio, %                       40.0      36.3       37.8
Operating cash flow                 -1,682       137      9,932
ROCE, %                               15.0      17.5       17.4
Personnel at end of the period       2,080     1,873      2,074


President and CEO Juha Näkki:

“The year 2016 began with substantial growth, boosted by acquisitions made in
2015. However, organic growth was slow due to the market situation and large
number of holidays in the review period. Uncertainty in the global markets was
reflected in demand, and the market situation was particularly difficult in
Finland. Our profitability declined due to these reasons. 

In the area of engineering services, new projects were slow to get started and
the difficult market situation prolonged price negotiations, which had a
negative impact on our profitability. The number of new investment projects was
very low, which resulted in plant engineering falling short of our
expectations. Nevertheless, our quotation base in plant engineering is very
strong and we expect that projects will start during the year. In China, the
development of the services market continued positively in spite of the slowing
economic development. We acquired several new customers and, at the end of the
review period, we achieved a turnaround in the number of working hours sold in
the Chinese market. 

In technical documentation, the development of our business was again
excellent. Profitability was weakened in the review period, as expected, by the
slow development of business operations in Germany and the fact that the
software business accounted for a lower share of revenue than it normally does.
Corrective measures to improve profitability are underway and we expect our
excellent development in technical documentation to continue in 2016. 

In spite of the difficult market situation, we continued the determined
implementation of the Company’s growth strategy and carried out the largest
acquisition in the Company’s history by acquiring the entire share capitals of
Espotel Oy and Soikea Solutions Oy. These acquisitions significantly
strengthened our position in the rapidly growing market for embedded systems
and industrial internet solutions. We combine intelligent devices,
documentation and industrial internet applications to create a unique service
concept in the engineering industry. Our service concept will enable us to
produce even greater value added for our customers; for example, in the service
and maintenance business. I am eagerly looking forward to pursuing these new
growth opportunities.” 

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-March 2016
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, April 28, 2016

Etteplan’s President and CEO Juha Näkki will present Company’s results for
January-March 2016 in a conference call and a live webcast for analysts and
investors, held in English language, on April 28, 2016 starting at 3.30 p.m.
Finnish time (EEST). 

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 Etteplan2016.
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 on
http://www.goodmood.fi/webcaster/accounts/etteplan/live/. The webcast starts at
3.30 p.m. Finnish time (EEST). A recording of the webcast will be later
available at www.etteplan.com/Investors. 


Vantaa, April 28, 2016

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 Helsinki
Major media
www.etteplan.com

Etteplan’s services cover engineering, technical documentation, embedded
systems and IoT solutions. Our customers are 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 2015, Etteplan had turnover of EUR 141.1 million. The company has about
2,400 professionals in Finland, Sweden, the Netherlands, Germany, Poland and
China. Etteplan's shares are listed on Nasdaq Helsinki Ltd under the ETT1V
ticker.

Attachments:

Etteplan_2016_Q1_EN.pdf