Skive, Denmark, 2014-10-29 14:11 CET (GLOBE NEWSWIRE) --
Dantherm realised revenue of DKK 80m in Q3 2014 for the continuing operations, which was on a par with the same period of 2013. Operating profit (EBIT) amounted to DKK 3.5m, which is an improvement over Q3 2013, where the operating profit was DKK 0.7m. The improvements in H2 2014 is not expected to fully compensate for the weaker H1 and revenue and operating profit (EBIT) for the year as a whole are expected to be a little lower than previously announced.
Torben Duer, President & CEO:
“Operating profit for Q3 2014 improved over the first two quarters and Q3 2013, and we also expect a good end to the year albeit we expect a little lower activity than previously. Completion of the divestment of the Telecom business is expected in near future and the focus is on the strategic development of the remaining business areas with a view to increasing revenue and profitability. We are working on increasing revenue through organic initiatives as well as acquisitions of activities with a view to more effective use of the existing production facilities.”
Divestment of Telecom business segment
- As mentioned in company announcement no. 11 of 29 August 2014, the closing related to the divestment of the Telecom business segment was expected to be completed in near future. Completion of closing related to the divestment is taking longer than the parties had expected due to processes in China, but completion of closing is still expected in near future.
- On a debt-free basis, the selling price is expected to be approx. DKK 138m, which is expected to lead to an accounting loss in 2014 of approx. DKK 15m (DKK -14.6m of which was recognised in Q1-Q3 2014), including costs for the sales process and the impact on results in 2014 of the divested activities until closing.
Developments in Q3 2014
- Revenue from continuing operations totalled DKK 80m relative to DKK 81m in Q3 2013.
- An operating profit (EBIT) of DKK 3.5m was posted for the continuing operations against an operating profit of DKK 0.7m in Q3 2013. The improved operating profit is due to higher contribution ratios and lower costs.
- Cash flows from operating activities were positive at DKK 7.7m against positive cash flows of DKK 0.7m in Q3 2013.
Developments in Q1-Q3 2014
- Revenue came to DKK 217m from continuing operations against DKK 239m in the same period of 2013.
- An operating loss (EBIT) of DKK 3.9m was posted for the continuing operations against an operating profit of DKK 1.8m in Q1-Q3 2013.
- Cash flows from operating activities were positive at DKK 3.6m against positive cash flows of DKK 1.0m in the same period of 2013.
Financial structure
- In February 2014 Dantherm concluded its agreement with the primary credit institutions on extension of the existing committed facilities until 31 March 2015. The agreement comprises the usual covenants. The covenants end of Q2 and Q3 2014 were calculated under the assumption that closing related to the divestment of the Telecom business segment was completed before these dates. Due to delay in the closing process Dantherm was not able to meet these covenants and has received a waiver. Dantherm is in a good dialogue with its credit institutions on the credit facilities and closing is still expected to be completed in near future.
- After closing of the divestment of the Telecom business segment, Dantherm will settle the facilities related to operations under the committed facilities agreed with the credit institutions, and net interest-bearing debt is expected to be reduced to approx. DKK 87m (year-end 2013: DKK 203m), which is primarily associated with property financing in Denmark and Norway.
Capital structure and strategic development
- With the completed cost savings and the significantly lower finance costs following the divestment of the Telecom business segment, going forward Dantherm is expected to be able to realise positive results before tax at the same level of revenue as in recent years.
- In the time to come, Dantherm’s management will be launching measures to increase revenue through organic initiatives as well as acquisitions of activities with a view to more effective use of the existing production facilities. The possibilities of further strengthening Dantherm’s capital base will continue to be assessed.
Outlook for 2014
In 2014, Dantherm expects revenue for continuing operations in the region of DKK 300m (previously DKK 300-325m) and an operating profit (EBIT) of around DKK 0m (previously DKK 5-10m).
The operating profit (EBIT) for Q3 2014 was higher than in the same period of 2013 and is expected to be higher for H2 2014 as a whole compared to 2013. The improvements in H2 2014, is not expected to fully compensate for the weaker H1 as a result of lower sales in especially Russia and Germany.
Any enquiries concerning this announcement can be directed to President & CEO Torben Duer on tel. +45 99 14 90 14.
