RAUTE CORPORATION FINANCIAL STATEMENTS RELEASE FEBRUARY 14, 2019 AT 9:00 A.M.
RAUTE CORPORATION – FINANCIAL STATEMENTS JANUARY 1 – DECEMBER 31, 2018
This is a summary of Raute’s Financial statements release January 1 – December 31, 2018. The full report is a PDF file attachment to this stock exchange release and is also available on the company's website at www.raute.com.
- The Group’s net sales amounted to EUR 181.0 million (MEUR 148.1), up 22% on the comparison year. Order intake, at EUR 167 million (MEUR 155), was at a very good level and increased by 8%. The order book at the end of the year stood at EUR 95 million (MEUR 110).
- Operating profit amounted to EUR 14.9 million (MEUR 11.2), up 34%. The result before taxes was EUR 14.9 million (MEUR 11.1). Profit for the financial year was EUR 11.8 million (MEUR 9.0).
- Undiluted earnings per share were EUR 2.78 (EUR 2.13) and diluted earnings per share were EUR 2.76 (EUR 2.11).
- Fourth-quarter net sales amounted to EUR 54.2 million and the operating result was EUR 3.4 million. Order intake was EUR 28 million.
- The Board of Directors will propose to the Annual General Meeting that a dividend of EUR 1.40 (EUR 1.25) per share be paid for the financial year 2018.
- Raute’s net sales and operating profit for 2019 are expected to remain at the level of the previous year.
| Restated | Restated | |||
| 1.10.– | 1.10.– | 1.1. –31.12. | 1.1. –31.12. | |
| KEY FIGURES | 31.12.2018 | 31.12.2017 | 2018 | 2017 |
| Net sales, MEUR | 54,2 | 39,4 | 181,0 | 148,1 |
| Change in net sales, % | 37,6 | 9,2 | 22,2 | 30,9 |
| Exported portion of net sales, % | 81,5 | 79,9 | 84,6 | 82,6 |
| Operating profit, MEUR | 3,4 | 3,1 | 14,9 | 11,2 |
| Operating profit, % of net sales | 6,3 | 7,8 | 8,2 | 7,5 |
| Profit before taxes, MEUR | 3,4 | 3,0 | 14,9 | 11,1 |
| Profit before taxes, % of net sales | 6,2 | 7,7 | 8,2 | 7,5 |
| Profit for the period, MEUR | 2,9 | 2,7 | 11,8 | 9,0 |
| Profit for the period, % of net sales | 5,3 | 6,9 | 6,5 | 6,1 |
| Gross capital expenditure, MEUR | 1,2 | 1,3 | 4,4 | 7,0 |
| % of net sales | 2,3 | 3,4 | 2,4 | 4,7 |
| Research and development costs, MEUR | 1,3 | 0,8 | 3,7 | 3,2 |
| % of net sales | 2,4 | 2,1 | 2,1 | 2,2 |
| Order book, MEUR | 95 | 110 | 95 | 110 |
| Order intake, MEUR | 28 | 60 | 167 | 155 |
| Personnel, at the end of the period | 772 | 704 | 772 | 704 |
| Personnel, effective, on average | 725 | 660 | 725 | 660 |
| Personnel, on average | 748 | 682 | 748 | 682 |
TAPANI KIISKI, PRESIDENT AND CEO: FOURTH RECORD YEAR IN A ROW
Our strong performance continued in the final quarter of the year, and we reached a record full-year result on many indicators for the fourth consecutive year. Our Q4 and full-year net sales were record-high. In addition to increasing our capacity and streamlining our operations, both our own organization and our entire partner network showed excellent flexibility. During the final quarter, capacity costs and preparing for the end-phase costs of a few projects lowered our relative profitability. Despite this, we are satisfied with our performance. In project business, even large quarterly variations are the norm.
During the final part of the year, no major new projects were started up despite active negotiations. For the full year, order intake was at an all-time high level, and our order book in early 2019 is strong. This is one more reason to be satisfied with the past year. The high order intake shows that our competitiveness is strong.
Demand for our technology and services alike remains good. The focus is increasingly shifting to customers that are new to Raute and to their new types of needs. We also expect our customers’ decision-making, project implementation and progress to become more challenging from our perspective. We will continue investing in the development of our technology and our service offering and in our ability to serve the changing customer base both with products tailored to customer needs and by increasing our local presence. I am confident about our competitiveness and service capability even in a somewhat new situation.
Thanks to a strong existing order book, sustained brisk demand and our competitiveness-enhancing development projects, I believe that our solid performance will continue and that we will maintain last year’s record level in both net sales and operating profit also in the current year.
I would like to express my sincerest thanks for the past year to everyone who made our success possible: to Raute’s customers for their invaluable cooperation and trust, to our personnel for their outstanding work and strong commitment to executing major workloads, to our shareholders for their continued confidence in us, and to all our other partners for the part they played in furthering Raute’s development and success.
BUSINESS ENVIRONMENT
Market situation in customer industries
Raute’s customers in the plywood and LVL (Laminated Veneer Lumber) industries are engaged in the manufacture of wood products used in investment projects and are thus highly affected by fluctuations in construction, housing-related consumption, international trade and transportation.
The situation in the global economy and the financial markets during 2018 did not change considerably with respect to Raute. However, the economic outlook became more uncertain towards the end of the year and the risk of the uncertainty spreading to international trade policy increased.
Many of Raute’s established and traditional customers have invested heavily during the past few years and demand for our technology is partially shifting towards new types of customer accounts.
Demand for wood products technology and technology services
Thanks to a good economic and market situation, investment activity among Raute’s customers has remained high. Enquiry activity for new capacity projects and larger projects involving replacement and efficiency-boosting investments has remained at a good level, and trade is being actively negotiated.
Demand is especially strong in industrialized market areas, Europe, North America and Russia. Demand among major South American customers has somewhat picked up. Demand has been lower in emerging markets in Asia, including China, and in South America, but these markets are also showing growing interest towards Raute’s offering, which opens up opportunities for new customer accounts.
Demand for maintenance and spare parts services remained at a good level, which is an indication of the good capacity utilization rates of Raute’s customers’ production plants.
BOARD OF DIRECTORS’ PROPOSAL CONCERNING PROFIT DISTRIBUTION, DIVIDEND EUR 1.40 PER SHARE
On December 31, 2018, the parent company Raute Corporation’s distributable funds totaled EUR 43,954 thousand, of which EUR 19,691 thousand represents the profit for the financial year 2018.
The Board of Directors will propose to Raute Corporation’s Annual General Meeting, to be held on April 2, 2019, that a dividend of EUR 1.40 per share be paid to holders of series A and K shares for the financial year 2018, and that the remainder of the distributable funds be retained in equity.
On the date of the profit distribution proposal, the number of shares entitled to a dividend is 4,263,194 shares, which amounts to total dividends of EUR 5,968 thousand. Shareholders who are registered in the shareholders’ register maintained by Euroclear Finland Ltd on the record date for dividend distribution, April 4, 2019, are entitled to a dividend. The dividend payment date would be April 11, 2019.
No material changes have taken place in the company’s financial position after the end of the financial year. The company has good liquidity, and in the Board of Directors’ view, the proposed profit distribution does not pose a risk to solvency.
OUTLOOK FOR 2019
Due to the high order book and sustained brisk demand, we estimate that both Raute’s net sales and operating profit will remain at the level of the preceding year in 2019.
NEW DISCLOSURE PROCEDURE
Raute Corporation follows the disclosure procedure enabled by Standard 5.2b published by the Finnish Financial Supervision Authority and hereby publishes its Financial statement release enclosed to this stock exchange release. Raute’s Financial statements release is available in its entirety on the company's website at www.raute.com. Raute will follow this procedure in disclosing Interim reports and Financial statements in the future.
RAUTE CORPORATION
Board of Directors
BRIEFING ON FEBRUARY 14, 2019 AT 2 P.M.:
A briefing will be organized for analysts, investors and the media on February 14, 2019 at 2 p.m. at Scandic Simonkenttä Hotel, Bulsa-Freda cabinet, Simonkatu 9, Helsinki. The financial statements will be presented by Mr. Tapani Kiiski, President and CEO, and Ms. Tarja Järvinen, CFO.
FINANCIAL RELEASES IN 2019:
Raute’s half-year report and two interim reports will be published as follows:
- Interim report January–March on Friday, May 3, 2019
- Half-year report January–June on Wednesday, July 31, 2019
- Interim report January–September on Wednesday, October 31, 2019.
Raute Corporation’s consolidated financial statements will be published on February 14, 2019. Raute Corporation’s Annual Report 2018 will be published the week of February 25th.
Raute Corporation’s Annual General Meeting will be held in Lahti, at Sibelius Hall on Tuesday, April 2, 2019 at 6:00 p.m.
FURTHER INFORMATION:
Mr. Tapani Kiiski, President and CEO, Raute Corporation, mobile phone +358 400 814 148
Ms. Tarja Järvinen, Group Vice President, Finance, CFO, Raute Corporation, mobile phone +358 40 658 3562
DISTRIBUTION:
Nasdaq Helsinki Ltd, main media, www.raute.com
RAUTE IN BRIEF:
Raute is a technology and service company that operates worldwide. Raute’s customers are companies operating in the wood products industry that manufacture veneer, plywood, LVL (Laminated Veneer Lumber) and sawn timber. Its technology offering covers the entire production process for veneer, plywood and LVL and special measurement equipment for sawn timber. As a supplier of mill-scale projects, Raute is a global market leader both in the plywood and LVL industries. Additionally, Raute’s full-service concept includes technology services ranging from spare parts deliveries to regular maintenance and equipment modernizations. Raute’s head office is located in the Nastola area of Lahti, Finland. The company’s other production plants are located in Kajaani, Finland, the Vancouver area of Canada, the Shanghai area of China and in Pullman, Washington, USA. Raute’s net sales in 2018 were EUR 181.0 million. The Group’s headcount at the end of 2018 was 772. More information about the company can be found at www.raute.com.
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