Glaston Oyj Abp - Financial Statement Release

GLASTON’S FINANCIAL STATEMENT BULLETIN 1 January – 31 December 2016: YEAR 2016 ENDED STRONGLY

Helsinki, Finland, 2017-02-10 12:00 CET (GLOBE NEWSWIRE) -- 

GLASTON CORPORATION           FINANCIAL STATEMENT RELEASE 10.2.2017  AT 13.00

GLASTON’S FINANCIAL STATEMENT BULLETIN 1 January – 31 December 2016: YEAR 2016
ENDED STRONGLY 

This release is a summary of Glaston Corporation's financial statements
bulletin 2016. The complete report is attached to this release as a pdf-file.
The stock exchange release is also available on the company's website at the
address www.glaston.net. 




OCTOBER-DECEMBER 2016

- Orders received totalled EUR 33.6 (24.2) million.
- Net sales grew 8% to EUR 35.1 (32.6) million.
- Comparable EBITDA was EUR 3.4 (1.4) million.
- The operating result was EUR 2.4 (0.7 loss) million, i.e. 6.8 (-2.2)% of net
sales. 
- The comparable operating result was EUR 2.7 (0.6) million, representing 7.8%
(1.7%) of net sales. 
- Cash flow from business operations was strong at EUR 8.9 (0.7) million.

JANUARY-DECEMBER 2016

- Orders received totalled EUR 112.9 (107.4) million.
- The order book on 31 December 2016 was EUR 45.6 (38.5) million
- Net sales fell 13% to EUR 107.1 (123.4) million.
- Comparable EBITDA was EUR 5.4 (9.5) million, i.e. 5.1 (7.7)% of net sales.
- The operating result was EUR 2.3 (6.6) million, i.e. 2.1 (5.4)% of net sales.
- The comparable operating result fell to EUR 2.8 (6.1) million, i.e. 2.6
(4.9)% of net sales. 
- Continuing Operations’ return on capital employed (ROCE) was 4.6 (10.0)%.
- Continuing Operations’ earnings per share were EUR 0.01 (0.00).
- Net Interest-bearing debt amounted to EUR -0.6 (7.4) million.
- The Board of Directors proposes that no dividend or return of capital shall
be distributed for year 2016. 




GLASTON’S OUTLOOK FOR 2017
A higher order book than the previous year, positive market development and the
cost-saving measures undertaken create good conditions for the development of
operations in 2017. For the first quarter, a relatively small number of
deliveries are scheduled, as a result of which the comparable operating result
for the period is expected to be lower than the corresponding period a year
earlier. 

Glaston expects the full-year comparable operating result to improve from 2016.
(In 2016 the comparable operating result was EUR 2.8 million.) 

PRESIDENT & CEO ARTO METSÄNEN:
“In the fourth quarter, the glass processing machine market picked up and,
advancing cautiously, the year ended strongly. The best development was seen in
the EMEA region, where new machine orders grew by 53% compared with the
previous quarter. 

Due to a large number of machine deliveries, October–December net sales grew by
8% from the previous year and totalled EUR 35.1 million. The comparable
operating profit improved to EUR 2.7 (0.6) million, i.e. 7.8% of net sales.
Earnings development was particularly influenced by increased net sales and
cost-saving measures. 

Full-year net sales totalled EUR 107.1 million and the comparable operating
result was EUR 2.8 (6.1) million. Lower net sales than the previous year and
cost overruns associated with customer projects reduced earnings. Cost-saving
measures implemented during the year had a positive effect on earnings. 

In spring we renewed our strategy. Our core expertise is flat tempering
technology. In addition to our core business, we also see growth in other
safety glass categories, such as bending, tempering-bending and laminating. 

We are also actively seeking new business opportunities in emerging glass
technologies. In January 2017, we established the Glaston Emerging Technologies
unit, which offers consulting and planning services for smart glass and energy
glass windows production as well as solar energy applications. The intention is
also for the unit to act as a supplier of the said production lines in future.
The nanotechnology project in which we have been participating since late 2015
is proceeding on schedule. Progress of the project as planned would bring to
Glaston equipment orders in the next few years. 

We start 2017 on a better footing than a year ago. A stronger order backlog,
positive market development and the savings measures undertaken create a good
foundation for profitable growth.” 





                                                                                
KEY FIGURES                                               31.12.2016  31.12.2015
                                                                                
Order book, EUR million                                         45.6        38.5
Orders, received, EUR million                                  112.9       107.4
Net sales, EUR million                                         107.1       123.4
EBITDA, comparable, EUR million                                  5.4         9.5
EBITDA, comparable, as % of net sales                            5.1         7.7
Operating result (EBIT), comparable, EUR million                 2.8         6.1
Operating result (EBIT), comparable , as % of net sales          2.6         4.9
Profit / loss for the period, EUR million                        1.0       -13.8
Earnings per share, EUR                                         0.01       -0.07
Net cash flow from operating activities                         13.4        -3.0
Return on capital employed, %, annualized                        4.6       -13.8
Gross capital expenditure, continuing and discontinued           3.9         7.2
 operations. EUR million                                                        
Equity ratio, %                                                 43.2        43.9
Gearing, %                                                      46.7        36.7



OPERATING ENVIRONMENT
As we entered 2016, broad uncertainty was evident in the glass processing
market. A significant change for the better was seen only in the last quarter
of the year, when a pick-up was perceptible, particularly in the EMEA area. In
the North American market, customers’ decision-making slowed in the latter part
of the year in both the USA and Mexico. The market situation remained
reasonably good, however. In South America, the market continued to be quiet.
In the Asian market area, development varied from country to country. The
market in China is still on a downward trend, but in many other countries
development has been positive. 

MACHINES
October–December
In the final quarter of the year, a clear pick-up took place in the Machines
business market environment. The most positive development was in the EMEA
area, where the number of new orders grew by 53% compared with the previous
quarter. In North America, demand for customers’ products is good, but
customers’ decision-making remains slow. In South America, the Brazilian market
continued to be quiet, while in Chile, Peru and Colombia, the first signs of
positive development were perceptible. In Asia, the market environment varied
significantly from area to area. In Australia and New Zealand, good development
continued. The Chinese market remained challenging, but emerging demand for
more technologically advanced machines is evident. 

In the final quarter of the year, Glaston strengthened its market position due
to its new FC™ and RC™ flat tempering lines. The FC™ product series, launched
at the Glasstec Fair in September, quickly achieved a solid market position. In
the latter part of the year, the first deals for the new products were sealed. 

January–December
North America and the EMEA area remained the largest markets for Glaston’s
Machines business. A change took place in the North American market in the
second half of the year, when customers’ decision-making times lengthened.
Competition intensified as Chinese operators strengthened their presence in the
market. The South American market continued to be quiet, but outside Brazil a
slight pick-up was seen towards the end of the year. In the EMEA area,
particularly in Eastern Europe and in Italy, the market developed positively.
In some countries, customers’ investments were boosted by tax breaks on
investments. 

In the Asian market, Glaston’s success varied from area to area. Due to its
competitive product offering and increased presence, Glaston achieved a leading
position in the Australian and New Zealand tempering machine markets following
a number of quieter years. Overall, the Southeast Asia machine market was
quiet, with the exception of Vietnam. In China, customers’ activity increased
in the second part of the year. 

SERVICES
October–December
After a subdued start to the year, the Services business market picked up in
the final quarter. After a weak third quarter, the EMEA area returned to a
satisfactory level. In Asia and South America, customers’ activity increased
towards the end of the year. The North American market remained challenging. 

Right at the end of the year, a substantial improvement took place in the
market for modernisation products, and of the whole year’s upgrade and
modernisation orders, some 35% were received during the final quarter. Glaston
agreed, among others, significant lamination machine modernisation deals for
Malaysia, Norway and the United Kingdom as well as flat tempering line upgrades
for the United Arab Emirates, Sweden and the USA. In automotive products, deals
were closed for Turkey and Poland. In the final quarter, two significant spare
parts agreements were also signed for Europe. In these, Glaston will act as the
sole spare parts supplier for the customer’s heat treatment machines. Sales of
heat treatment machine spare parts remained at a high level, particularly in
North America. Sales of tools turned to growth. 

January–December
In 2016 broad uncertainty was evident in the Services business market, with
demand remaining subdued with the exception of the final quarter. The strongest
areas for business continued to be North America and the EMEA area. The South
American market remained quiet, although indications of a recovery were
perceptible in automotive business. In the Asia market area, there was positive
development in Australia, New Zealand and Southeast Asia. The service market in
China remained quiet. 

There were fewer large modernisation and upgrade projects than the previous
year. In Australia and New Zealand, active new machine business slowed sales of
upgrade products. Excluding the final quarter, demand for modernisation
products remained subdued in the EMEA area. In North America, the machine
investments of earlier years impacted sales of upgrade products, and
modernisation of the machine stock will become due only after a few years. 

Service and spare parts sales for heat treatment machines remained at a high
level. In terms of numbers, there were more deals than the previous year, but
the average size of single orders fell slightly. The strongest sales areas
continued to be North America and the EMEA area. 

In the tools product group, competition remained aggressive. Despite the
difficult market situation, sales of tools began to grow tentatively towards
the end of the year. New types of tools were introduced into the product group
during the year and the distribution network was expanded. 

OUTLOOK
The development of the glass processing market was positive at the end of 2016.
There are currently no signs of a weakening of the market, and positive
development is expected to continue. Despite good demand, customers are often
taking longer to make their investment decisions due to the uncertain global
economy and political developments. 

A higher order book than the previous year, positive market development and the
cost-saving measures undertaken create good conditions for the development of
operations in 2017. For the first quarter, a relatively small number of
deliveries are scheduled, as a result of which the comparable operating result
for the period is expected to be lower than the corresponding period a year
earlier. 

Glaston expects the full-year comparable operating result to improve from 2016.
(In 2016 the comparable operating result was EUR 2.8 million.) 

BOARD OF DIRECTORS’ PROPOSAL ON THE DISTRIBUTION OF PROFITS
The distributable funds of Glaston Corporation are EUR 16,241,163, of which EUR
-5,664,105 represents the net loss for the financial year. 

The comparable earnings per share for 2016 were EUR 0.01. According to the
dividend policy, the objective is to distribute annually a dividend or return
of capital amounting to 30–50% of the company’s comparable earnings per share.
As the company is investing strongly in the development of new technology and
as comparable earnings per share are only EUR 0.01, the Board of Directors
proposes that no dividend or return of capital be distributed for 2016. 


PRESS MEETING
An analyst and press conference is organized at Glaston's office on
Lönnrotinkatu 11, Helsinki, on 10 February 2016 at 14.00 p.m. 

For further information, please contact:
President & CEO Arto Metsänen, tel. +358 10 500 500
Chief Financial Officer Päivi Lindqvist, tel. +358 10 500 500







GLASTON CORPORATION
Agneta Selroos
Communications Director









Glaston Corporation
Glaston is a leading company in glass processing technologies. We provide
high-quality heat treatment machines and services for architectural, solar,
appliance and automotive applications. We are committed to our customers’
success over the entire lifecycle of our offering. Moreover, we continuously
innovate and develop technologies to enable the glass processing industry to
reach ever higher standards in quality and safety. Glaston’s shares (GLA1V) are
listed on NASDAQ Helsinki Ltd. Further information is available at
www.glaston.net 





Distribution: NASDAQ Helsinki Ltd, key media, www.glaston.net

Attachments:

Glaston Financial Statement Bulletin.pdf