2013-05-03 08:00:02 CEST
2013-05-03 08:00:08 CEST
REGULATED INFORMATION
Exel Composites Oyj - Interim report (Q1 and Q3)
Exel Composites Plc's Interim Report for January 1 - March 31, 2013
EXEL COMPOSITES PLC STOCK EXCHANGE RELEASE 3.5.2013 at
9.00 1 (12)
EXEL COMPOSITES PLC'S INTERIM REPORT FOR JANUARY 1 - MARCH 31, 2013
JANUARY - MARCH 2013 HIGHLIGHTS
- Net sales decreased to EUR 16.9 (20.5) million in the first quarter of 2013,
down by 17.7 per cent on the previous year
- Operating profit was EUR 0.7 million in the first quarter of 2013 compared to
EUR 1.8 million in the first quarter of 2012, or 3.9 (8.9) per cent of net
sales
- Net operative cash flow was positive at EUR +0.7 (+1.5) million
- Fully diluted earnings per share were EUR 0.05 (0.11)
OUTLOOK FOR 2013
Major uncertainties relating to general growth prospects in the economy
continue. Visibility is low and the market pressure is expected to continue in
2013. The Company will continue to work on sales development and on adjusting
costs to market conditions. Additional contingency actions may be undertaken
which may impact the short-term profits, but protect long-term cash flow and
profitability.
COMMENTS BY THE CEO
“The market situation in Central Europe continued to weaken during the first
quarter of 2013. Sales continued to decrease in almost all the market segments
compared to the same period in 2012. Market demand increased only in the
transportation market segment compared to the first quarter of 2012. Net sales
decreased in the first quarter 2013 and were EUR 16.9 (20.5) million, a
decrease of 17.7 per cent. Sales decreased especially in the telecommunication
market segment, electrical industry, machine industry and general industries.
Sales increased in the transportation industry compared to the first quarter of
2012.
The Group's operating profit was EUR 0.7 (1.8) million. The main reasons for
the decrease were lower sales and sales margins especially in the Finnish
units.
Visibility is low and the market pressure is expected to continue.
Profitability continues to be weak in the Australian business unit in spite of
corrective actions undertaken. Corrective actions will be continued. Structural
changes will also be considered. Co-determination negotiations will be started
in the Finnish business units due to weak demand and profitability. The focus
will be on sales, efficiency and yield improvement as well as on turnaround
measures.
Despite the challenging situation the composite market is estimated to develop
positively in the longer run, and Exel Composites is well-positioned when the
market recovers.”
CONSOLIDATED KEY FIGURES, EUR million
(unaudited)
1.1. - 1.1.-31.3. Change, % 1.1. -
31.3. 2012 31.12.
2013 2012
Net sales 16.9 20.5 -17.7 76.0
Operating profit 0.7 1.8 -63.6 3.4
% of net sales 3.9 8.9 4.5
Profit for the period 0.6 1.3 -57.6 2.0
Shareholders' equity 28.7 30.3 -5.1 31.4
Net interest-bearing liabilities -1.1 -2.4 -1.1
Capital employed 36.1 38.4 -6.1 39.6
Return on equity, % 7.4 16.0 6.1
Return on capital employed, % 7.1 18.1 8.4
Equity ratio, % 54.0 51.5 61.0
Net gearing, % -4.0 -8.1 -3.4
Earnings per share, EUR 0.05 0.11 0.17
Earnings per share, diluted, EUR 0.05 0.11 0.17
Equity per share, EUR 2.42 2.54 2.64
IFRS REPORTING
This financial statements bulletin has been prepared in accordance with the
recognition and measurement principles of IFRS, which are the same as in the
2012 financial statements.
FINANCIAL PERFORMANCE
The Group's net sales in January - March 2013 were EUR 16.9 (20.5) million, a
decrease of 17.7 per cent. Sales continued to decrease in almost all the
market segments compared to the same period in 2012. Market demand increased
only in the transportation market segment compared to the first quarter of
2012. Sales decreased especially in the telecommunication market segment,
electrical industry, machine industry and general industries. Sales increased
in the transportation industry compared to the first quarter of 2012.
Exel Composites' operating profit for the first quarter of 2013 was EUR 0.7
(1.8) million or 3.9 (8.9) per cent of net sales. The main reasons for the
decrease were lower sales and sales margins especially in the Finnish units.
Visibility is low and the market pressure is expected to continue.
Profitability continues to be weak in the Australian business unit in spite of
corrective actions undertaken. Corrective actions will be continued. Structural
changes will also be considered. Co-determination negotiations will be started
in the Finnish business units due to weak demand and profitability. The focus
will be on sales, efficiency and yield improvement as well as on turnaround
measures.
The Group's net financial expenses in the first quarter of 2013 were EUR 0.0
(0.1) million. The Group's profit before taxes was EUR 0.7 (1.7) million and
profit after taxes EUR 0.6 (1.3) million.
Fully diluted total earnings per share were EUR 0.05 (0.11). Return on capital
employed was 7.1 (18.1) per cent. Return on equity was 7.4 (16.0) per cent.
BALANCE SHEET AND FINANCIAL POSITION
Cash flow from business operations was positive at EUR 0.7 (1.5) million. Cash
flow before financing, but after capital expenditure, amounted to EUR 0.1 (0.7)
million.
Capital expenditure was financed with cash flow from business operations. At
the end of the review period, the Group's liquid assets stood at EUR 8.5 (10.6)
million.
The Group's consolidated total assets at the end of the period under review
were EUR 53.3 (58.8) million.
Interest-bearing liabilities amounted to EUR 7.3 (8.1) million. Net
interest-bearing liabilities were EUR -1.1 (-2.4) million. Non-current
liabilities were amortized by EUR 5.0 million and new short-term loans were
withdrawn amounting to EUR 4.1 million.
Equity at the end of the first quarter of 2013 was EUR 28.7 (30.3) million and
equity ratio 54.0 (51.5) per cent. The net gearing ratio was -4.0 (-8.1) per
cent.
CAPITAL EXPENDITURE AND DEPRECIATION
The capital expenditure on fixed assets amounted to EUR 0.6 (0.8) million.
Total depreciation of non-current assets during the period under review
amounted to EUR 0.7 (0.7) million.
PERSONNEL
The number of Exel Composites Group employees on 31 March 2013 was 436 (433),
of whom 209 (200) worked in Finland and 227 (233) in other countries. The
average number of personnel during the financial year was 439 (428). The use of
temporary workforce has been largely discontinued for the time being. In
Finland part of maintenance functions were transferred back to Exel Composites,
which increased its own personnel by 8 persons.
The ExelWay project that was launched in the latter half of 2011 was continued.
The project aims at improving co-operation and harmonizing processes between
the units. Project findings including new and efficient business processes and
best practices are to be implemented as the project proceeds.
SHARES AND SHARE CAPITAL
At the end of March 2013, Exel Composites' share capital was EUR 2,141,431.74
and the number of shares was 11,896,843. There were no changes in the share
capital during the review period.
Exel Composites did not hold any of its own shares during the period of review.
SHARE PERFORMANCE AND TURNOVER
The highest share price quoted was EUR 6.50 (8.79) and the lowest EUR 5.70
(7.70). The share price closed at EUR 5.80 (8.29). The average share price
during the period under review was EUR 6.16 (8.36).
A total of 198,853 (241,203) shares were traded during the reporting period,
which represents 1.7 (2.0) per cent of the average number of shares. Based on
the closing price on 31 March 2013, Exel Composites' market capitalization was
EUR 69.0 (98.6) million.
SHAREHOLDERS AND DISCLOSURES
Exel Composites had a total of 2,795 (2,726) shareholders on 31 Mach 2013.
Information on Exel Composites' shareholders is available on the Company
website at www.exelcomposites.com.
Exel Composites did not receive any flagging announcements during the period
under review.
ANNUAL GENERAL MEETING
Exel Composites' Annual General Meeting (“AGM”) was held on 27 March 2013. The
financial accounts of the Group were approved and the members of the Board of
Directors and the President were discharged from their liabilities for the
financial year 2012. The AGM approved the Board of Directors' proposal to
distribute a dividend of EUR 0.30 per share for the financial period that ended
on 31 December 2012.
The Annual General Meeting authorized the Board of Directors to acquire the
Company's own shares by using unrestricted equity. The maximum amount to be
acquired is 600,000 shares. The authorization is valid until 30 June 2014.
The Annual General Meeting authorised the Board of Directors to decide on the
issuance of a maximum of 2,400,000 new shares and/or conveyance of a maximum of
600,000 Company's own shares. By virtue of the authorisation, the Board of
Directors also has the right to grant option rights, convertible bonds and/or
other special rights referred to in Chapter 10, Section 1 of the Companies Act,
which entitle to new shares or the Company's own shares against payment in such
a manner that the subscription price of the shares is paid in cash or by using
the subscriber's receivable to set off the subscription price.
New shares may be issued and the Company's own shares held by the Company may
be conveyed also for free. A directed share issue may be free only if there is
an especially weighty financial reason both for the Company and with regard to
the interests of all shareholders in the Company, such as using the shares as a
part of the Company's incentive program for personnel. The new shares may also
be issued in a free share issue to the Company itself.
The authorisations are valid until 30 June 2016.
The AGM confirmed the number of the members of the Board of Directors as five
and elected a new Board. All the members of the Board of Directors were
re-elected: Heikki Hiltunen, Peter Hofvenstam, Göran Jönsson, Reima Kerttula
and Heikki Mairinoja. At the formative meeting of the Board of Directors held
after the AGM, the Board of Directors elected from among its members Peter
Hofvenstam as its Chairman.
The AGM decided that the annual remuneration for the Board members be
unchanged, i.e. the Chairman of the Board of Directors be paid a yearly
remuneration of EUR 34,000 and additionally EUR 1,500 for attendance at Board
and committee meetings and other similar Board assignments and the other Board
members be paid a yearly remuneration of EUR 16,000 and additionally EUR 1,000
for attendance at Board and committee meetings and other similar Board
assignments and that travel expenses and other out-of-pocket expenses arising
from the Board work be compensated in accordance with the Company's established
practice and travel rules. Out of the yearly remuneration 60 per cent will be
paid in cash and 40 per cent in Exel Composites Plc shares, which were acquired
directly for and on behalf of the members of the Board of Directors during 2
April -8 April 2013 from the stock exchange in amounts corresponding to EUR
13,600 for the Chairman and EUR 6,400 for each of the other members.
MAJOR NEAR-TERM RISKS AND UNCERTAINTIES
The most significant near-term business risks are related to the general
economic development, government regulations and continued financial crisis in
the Euro area as well as to market demand in certain market segments. Success
of corrective actions as well as possible restructuring and impairment charges
can have an impact on the profitability. Raw material prices, energy cost and
other cost increases may continue to put pressure on profitability. Currency
rate changes, price competition and alternative competing materials may also
have a negative effect on the result. The availability and cost of financing
may continue to have an effect on the demand and increase the risk of credit
losses.
EVENTS AFTER THE REPORTING PERIOD
Co-determination negotiations concerning all the employment groups of the
Finnish units of the Exel Composites Group will be commenced on 13 May 2013.
The aim is to conclude the negotiations during week 26.
OUTLOOK FOR 2013
Major uncertainties relating to general growth prospects in the economy
continue. Visibility is low, but the market pressure is expected to continue in
2013. The Company will continue to work on sales development and on adjusting
costs to market conditions. Additional contingency actions may be undertaken
which may impact the short-term profits, but protect long-term cash flow and
profitability.
CONSOLIDATED COMPREHENSIVE INCOME STATEMENT
(unaudited)
EUR thousand 1.1. - 1.1. - Change 1.1. -
31.3. 31.3. , % 31.12.
2013 2012 2012
Net sales 16,897 20,519 -17.7 75,998
Materials and services -6,430 -8,119 20.8 -29,986
Employee benefit expenses -5,309 -5,618 5.5 -21,077
Depreciation and impairment -673 -742 9.3 -5,387
Other operating expenses -3,981 -4,452 10.6 -17,057
Other operating income 163 240 -32.1 909
Operating profit 666 1,828 -63.6 3,399
Net financial items 24 -83 128.9 -428
Profit before tax 691 1,745 -60.4 2,971
Income taxes -136 -435 68.7 -940
Profit/loss for the period 555 1,310 -57.6 2,031
Other comprehensive income:
Other comprehensive income to be reclassified
to profit or loss in subsequent periods:
Exchange differences on translating foreign 298 -205 245.4 133
operations
Other comprehensive income, net of tax 0 0 0 0
Total comprehensive income 853 1,105 -22.8 2,164
Profit/loss attributable to:
Equity holders of the parent company 555 1,310 2,031
Comprehensive income
attributable to:
Equity holders of the parent company 853 1,105 2,164
Earnings per share, diluted and undiluted, EUR 0.05 0.11 0.17
CONDENSED CONSOLIDATED BALANCE SHEET
EUR thousand 31.3.2013 31.3.2012 Change 31.12.2012
ASSETS
Non-current assets
Goodwill 11,179 11,854 -675 10,898
Other intangible assets 1,153 1,803 -650 1,220
Tangible assets 10,768 11,730 -962 10,681
Deferred tax assets 858 147 711 752
Other non-current assets 62 65 -3 64
Non-current assets total 24,021 25,600 -1,579 23,615
Current assets
Inventories 9,276 10,278 -1,002 9,129
Trade and other receivables 11,488 12,389 -901 9,513
Cash at bank and in hand 8,465 10,551 -2,086 9,245
Current assets total 29,229 33,218 -3,989 27,887
Total assets 53,250 58,818 -5,568 51,502
EQUITY AND LIABILITIES
Shareholders´ equity
Share capital 2,141 2,141 0 2,141
Other reserves 45 30 15 45
Invested unrestricted equity fund 8,488 8,488 0 8,488
Translation differences 4,636 3,999 637 4,337
Retained earnings 12,874 14,306 -1,432 14,396
Profit for the period 555 1,310 -755 2,031
Total equity attributable to equity 28,738 30,274 -1,536 31,438
holders of the parent company
Total equity 28,738 30,274 -1,536 31,438
Non-current liabilities
Interest-bearing liabilities 2,497 8,103 -5,606 8,168
Interest-free liabilities 426 400 26 411
Deferred tax liabilities 376 520 -144 377
Current liabilities
Interest-bearing liabilities 4,823 10 4,813 11
Trade and other non-current 16,390 19,512 -3,122 11,098
liabilities
Total liabilities 24,512 28,544 -4,032 20,064
Total equity and liabilities 53,250 58,818 -5,568 51,502
STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
EUR thousand Share Other Invested Translation Retained Total
Capita Reserves Unrestricted Differences Earnings
l Equity Fund
Balance at 1 2,141 30 8,488 4,204 20,255 35,118
January
2012
Comprehensiv -205 1,310 1,105
e result
Other items
Dividend -5,948 -5,948
Balance at 2,141 30 8,488 3,999 15,616 30,274
31 March
2012
Balance at 1 2,141 45 8,488 4,337 16,427 31,438
January
2013
Comprehensiv 298 555 853
e result
Other items 16 16
Dividend -3,569 -3,569
Balance at 2,141 45 8,488 4,636 13,429 28,738
31 March
2013
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
EUR thousand 1.1. - 1.1. - Change 1.1. - 31.12.
31.3. 31.3. 2012
2013 2012
Cash Flow from Operating Activities
Profit for the period 555 1,310 -755 2,031
Adjustments 810 1,153 -343 7,170
Change in working capital -371 -179 -192 1,223
Cash Flow Generated by Operations 994 2,284 -1,290 10,424
Interest paid -37 -47 10 -259
Interest received 3 20 -17 80
Other financial items -25 14 -39 -155
Income taxes paid -236 -767 531 -1,897
Net Cash Flow from Operating Activities 699 1,504 -805 8,193
Capital expenditure -610 -790 180 -2,846
Proceeds from sale of fixed assets 0 0 0 16
Cash Flow from Investing Activities -610 -790 180 -2,830
Cash Flow from Financing
Proceeds from long-term borrowings 0 0 0 0
Instalments of long-term borrowings -5,000 0 -5,000 0
Change in short-term loans 4,134 0 4,134 0
Change in finance lease liabilities -3 -3 0 -10
Dividends paid 0 0 0 -5,948
Net Cash Flow from Financing -869 -3 -866 -5,958
Change in Liquid Funds -780 711 -1,491 -595
Liquid funds in the beginning of period 9,245 9,840 -595 9,840
Change in liquid funds -780 711 -1,491 -595
Liquid funds at the end of period 8,465 10,551 -2,086 9,245
QUARTERLY KEY FIGURES
EUR thousand I/ IV/ III/ II/ I/
2013 2012 2012 2012 2012
Net sales 16,897 18,634 17,054 19,791 20,519
Materials and services -6,430 -7,670 -6,706 -7,491 -8,119
Employee benefit expenses -5,309 -5,095 -4,422 -5,942 -5,618
Depreciation and impairment -673 -3,304 -619 -723 -742
Operating expenses -3,981 -4,345 -4,052 -4,209 -4,452
Other operating income 163 173 107 390 240
Operating profit 666 -1,608 1,362 1,816 1,828
Net financial items 24 -109 -206 -30 -83
Profit before taxes 691 -1,717 1,156 1,786 1,745
Income taxes -136 246 -266 -485 -435
Profit/loss for the period from 555 -1,471 890 1,302 1,310
continuing operations
Profit/loss for the period 555 -1,471 890 1,302 1,310
Earnings per share, EUR 0.05 -0.12 0.07 0.11 0.11
Earnings per share, EUR, diluted 0.05 -0.12 0.07 0.11 0.11
Average number of shares, undiluted,
1,000 shares 11,897 11,897 11,897 11,897 11,897
Average number of shares, diluted,
1,000 shares 11,897 11,897 11,897 11,897 11,897
Average number of personnel 436 431 433 435 428
COMMITMENTS AND CONTINGENCIES
EUR thousand 31.3.2013 31.3.2012
On own behalf
Mortgages 2,783 2,783
Corporate mortgages 12,500 12,500
Lease liabilities
- in next 12 months 837 934
- in next 1-5 years 2,213 3,017
Other commitments 6 43
DERIVATIVE FINANCIAL INSTRUMENTS
Nominal values 31.3.2013 31.3.2012
EUR thousand
Foreign exchange derivatives
Forward contracts 0 0
Interest rate derivatives
Interest rate swaps 5,000 10,000
CONSOLIDATED KEY FIGURES
EUR thousand 1.1. - 31.3. 1.1. - Change, % 1.1.-
2013 31.3. 31.12.
2012 2012
Net sales 16,897 20,519 -17.7 75,998
Operating profit 666 1,829 -63.6 3,399
% of net sales 3.9 8.9 4.5
Profit before tax 691 1,745 -60.4 2,971
% of net sales 4.1 8.5 3.9
Profit for the period 555 1,310 -57.6 2,031
% of net sales 3.3 6.4 2.7
Shareholders´ equity 28,738 30,274 -5.1 31,438
Interest-bearing liabilities 7,320 8,113 -9.8 8,179
Cash and cash equivalents 8,465 10,551 -19.8 9,245
Net interest-bearing liabilities -1,145 -2,438 -1,066
Capital employed 36,058 38,387 -6.1 39,617
Return on equity, % 7.4 16.0 6.1
Return on capital employed, % 7.1 18.1 8.4
Equity ratio, % 54.0 51.5 61.0
Net gearing, % -4.0 -8.1 -3.4
Capital expenditure 610 790 -22.8 2,846
% of net sales 3.6 3.8 3.7
Research and development costs 321 411 -21.9 1,606
% of net sales 1.9 2.0 2.1
Order stock 11,763 14,459 -18.6 10,677
Earnings per share, EUR 0.05 0.11 -54.5 0.17
Earnings per share, EUR, diluted 0.05 0.11 -54.5 0.17
Equity per share, EUR 2.42 2.54 -4.7 2.65
Average number of shares
- cumulative 11,897 11,897 0.0 11,897
- cumulative, diluted 11,897 11,897 0.0 11,897
Average number of employees 436 428 1.9 431
PRESS CONFERENCE
Exel Composites will hold an analyst and press conference regarding the interim
report today Friday 3 May 2013 at 12.30 pm in the Freda Cabinet of the Scandic
Hotel Simonkenttä at Simonkatu 9, Helsinki, Finland.
FORWARD-LOOKING STATEMENTS
Certain statements in this report, which are not historical facts, including,
without limitation, those regarding expectations for general economic
development and market situation; regarding customer industry profitability and
investment willingness; regarding Company growth, development and
profitability; regarding cost savings; regarding fluctuations in exchange rates
and interest levels; regarding the success of pending and future acquisitions
and restructurings; and statements preceded by "believes,""expects,""anticipates,""foresees" or similar expressions are forward-looking
statements.
These statements are based on current expectations and currently known facts.
Therefore, they involve risks and uncertainties that may cause actual results
to differ materially from results currently expected by the Company.
Other unknown or unpredictable factors or underlying assumptions subsequently
proving to be incorrect could cause actual results to differ materially from
those in the forward-looking statements. Exel Composites does not undertake any
obligation to publicly update or revise forward-looking statements, whether as
a result of new information, future events or otherwise, except to the extent
legally required.
Vantaa, 3 May 2013
EXEL COMPOSITES PLC Vesa Korpimies
Board of Directors President and CEO
FURTHER INFORMATION:
Vesa Korpimies, President and CEO, tel. +358 50 590 6754, or email
vesa.korpimies@exelcomposites.com
Ilkka Silvanto, CFO and Administrative Director, tel. +358 50 598 9553, or
email ilkka.silvanto@exelcomposites.com
DISTRIBUTION
NASDAQ OMX Helsinki Ltd.
Main news media
www.exelcomposites.com
EXEL COMPOSITES IN BRIEF
Exel Composites (www.exelcomposites.com) is a technology company which designs,
manufactures and markets composite profiles and tubes for industrial
applications. The Group is the leading composite profile manufacturer in the
world and concentrates on growing niche segments.
The core of the operations is based on own, internally developed composite
technology, product range based on it and a strong market position in selected
segments with a strong quality and brand image. Profitable growth is pursued by
a relentless search for new applications and development in co-operation with
customers. The personnel's expertise and high level of technology play a major
role in Exel Composites' operations.
Exel Composites Plc share is listed in the Small Cap segment of NASDAQ OMX
Helsinki Ltd.
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