GLASTON CORPORATION FINANCIAL STATEMENT BULLETIN 9 FEBRUARY 2021 AT 13.00
This release is a summary of Glaston Corporation's financial statements bulletin for 2020. 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 2020 IN BRIEF
- Orders received totaled EUR 52.1 (49.2) million
- Net sales totaled EUR 38.3 (47.3) million
- Comparable EBITA was EUR 2.1 (2.5) million, i.e. 5.4 (5.2)% of net sales
- The operating result (EBIT) was EUR -0.7 (-0.9) million
- The comparable operating result (EBIT) was EUR 0.9 (1.3) million, i.e. 2.4 (2.8)% of net sales
- Items affecting comparability totaled EUR -1.6 (-2.3) million
- Comparable earnings per share were EUR -0.007 (-0.003)
- Cash flow from operating activities was EUR 3.5 (8.8) million
JANUARY–DECEMBER 2020 IN BRIEF
- Orders received totaled EUR 153.5 (162.2, pro forma 184.6) million
- Net sales totaled EUR 170.1 (181.0, pro forma 204.6) million
- Comparable EBITA was EUR 7.7 (9.7, pro forma 12.1) million, i.e. 4.6 (5.4, pro forma 5.9)% of net sales
- The operating result (EBIT) was EUR -0.5 (-1.3, pro forma 0.3) million
- The comparable operating result (EBIT) was EUR 3.2 (5.9, pro forma 7.5) million, i.e. 1.9 (3.3, pro forma 3.7)% of net sales
- Items affecting comparability totaled EUR -3.8 (-7.2, pro forma -7.2) million
- Comparable earnings per share were EUR -0.020 (0.011)
- Cash flow from operating activities was EUR 0.7 (10.8) million
- The Board of Directors proposes a capital repayment of EUR 0.02 per share
GLASTON’S OUTLOOK FOR 2021
The strong recovery in orders received towards the end of 2020 and continued positive market environment during the first weeks of 2021 indicate positive development for both the machines and services business throughout 2021. However, reflecting the lower order intake in 2020 compared to the previous year, Glaston will start 2021 with a 20% lower order backlog than the previous year. This will impact on Glaston’s net sales and comparable operating profit for the first half of 2021. The uncertainty related to the pace and extent of market recovery continues to be higher than normal due to the COVID-19 pandemic and its implications on economic activity, investments and travel restrictions.
Based on the expected continued market recovery, Glaston Corporation estimates, that its net sales and comparable EBITA will improve in 2021 from the levels reported for 2020. In 2020, Group net sales totaled EUR 170.1 million and comparable EBITA was EUR 7.7 million.
PRESIDENT & CEO ANDERS DAHLBLOM: Our work to create profitable growth and to realize the full potential of Glaston has started
“Glaston is an inspiring technology frontrunner in its field with 150 years of history and an exciting future. Throughout the years, Glaston has always been a technology leader and visionary in its industry and I’m proud and honored to lead the company as its President and CEO.
I have spent a good amount of time getting to know the company and its operations in the months that preceded my official start on 1 January. I’m enthusiastic about the company, its qualities and people and I see strong future potential. I’m also inspired about the potential of the innovative glass processing technologies for safe and sustainable glass solutions.
As to Glaston’s performance in the fourth quarter 2020, the demand for heat treatment equipment in particular increased towards the end of the quarter, resulting in a higher-than-expected order intake. Recovery was also noted in the Automotive market. The insulating glass business continued to experience high demand driven by the necessity to improve the energy efficiency of buildings. The services business picked up in the fourth quarter with increasing activity across all regions. Total orders received in the final quarter amounted to EUR 52.1 million, up by 6% compared to the same period in 2019. Despite the pick-up in the final quarter, orders received for the full year ended at 17% below the level of the previous year: EUR 153.5 (pro forma 184.6) million.
Net sales for the fourth quarter and for the full year decreased, mainly due to the lower order intake in the previous quarters. Net sales in the fourth quarter totaled EUR 38.3 (47.3) million. For the full year EUR 170.1 (pro forma 204.6) million was recorded, with the Insulating Glass Technologies product area exceeding previous year’s levels.
Profitability in 2020 was impacted by low sales volumes in both Heat Treatment and Automotive equipment but considering the prevailing circumstances during the year, was at a satisfactory level. Our prompt actions to adapt our operations to market demand, significantly impacted the outcome. The implemented synergy benefits also played a clear role in the fixed cost reduction. I would like to thank all Glaston employees for their dedication to keeping our promises to our customers and for their flexibility throughout a truly exceptional year.
Last year due to the integration of Bystronic glass and various corona-related adjustment measures, the focus of the organization was mainly internal. However, we are now in a position in which the organization can move forward and shift its focus to being more customer oriented with the target to create growth.
As a first priority in 2021, we will review Glaston’s strategy and this process already started in the second week of the year. Motivated employees and competitive products and solutions to serve our customers’ needs are the foundation to sustainable shareholder value. The ultimate target of the strategy is winning with customers, engaged employees and shareholder value creation. We will place great emphasis on realistic and carefully selected measures in order to implement our strategy.
Another key priority on Glaston’s agenda is phase two of the integration. In the first phase, the focus was on integrating and streamlining organizations. As a result, the overlapping activities were discontinued, offices merged and the estimated cost synergies were achieved and even exceeded in many areas. Phase two focuses on how to utilize the full potential of the integration. This covers the commercial potential for both equipment and services, for example the integrated growth strategy for our service businesses. We will also harmonize our ways of working globally to improve operational excellence. Working as one aligned team and organization with clear targets and priorities will give us additional advantages in the mid-term.
As environmental awareness increases, the demand for more energy-efficient and environmentally sustainable glass solutions is growing. Buildings will play a significant role in combating climate change as in the EU, for example, buildings account for 40% of total energy consumption, and 36% of carbon dioxide emissions. The greatest potential for reducing energy consumption lies in the renovation of existing buildings. The European Commission’s Renovation Rate strategy, launched in October 2020, aims to at least double renovation rates in the next ten years while ensuring that renovations lead to greater energy and resource efficiency. According to the European Commission, 35 million buildingscould be renovated by 2030. This will be a major driver for our business as double- or triple-glazed insulating glass units and coated, low-emissivity glass, both processed using Glaston’s technology, are key solutions for energy-efficient window renovation.
For Glaston, 2020 ended on a positive note with a strong recovery in orders received in the final quarter of the year. Good market activity has continued during the first weeks of 2021, indicating positive volume development for both machines and services businesses. Based on the expected continued market recovery, we estimate that the company’s 2021 net sales and comparable EBITA will improve from the previous year. Due to the coronavirus pandemic, uncertainty related to the pace and extent of market recovery is higher than normal, however.”
GLASTON GROUP’S KEY FIGURES
|10–12/2020||10-12/2019||1–12/2020||1–12/2019||Pro forma 1–12/2019|
|of which service operations||17.4||15.8||57.1||58.5||68.3|
|of which service operations, %||33.4%||32.1%||37.2%||36.1%||37.0%|
|Order book at end of period||63.9||79.5||79.5|
|of which service operations||17.1||16.9||58.1||57.1||67.1|
|of which service operations, %||44.8%||35.7%||34.2%||31.6%||32.8%|
|Items affecting comparability||1.6||2.3||3.8||7.2||7.2|
|Comparable EBITDA, %||7.6%||7.5%||6.7%||7.8%||8.2%|
|Comparable EBITA, %||5.4%||5.2%||4.6%||5.4%||5.9%|
|Operating result (EBIT)||-0,7||-0.9||-0.5||-1.3||0.3|
|Comparable operating result (EBIT)||0.9||1.3||3.2||5.9||7.5|
|Comparable operating result (EBIT), %||2.4%||2.8%||1.9%||3.3%||3.7%|
|Profit/loss before taxes||-1.4||-1.8||-3.3||-4.4||3.8|
|Profit/loss for the period||-2.2||-2.4||-5.5||-6.4||3.1|
|Comparable earnings per share, adjusted with share issue, EUR||-0.007||-0.003||-0.020||0.011|
|Number of registered shares at end of period adjusted with share issue (1,000)||84,290||84,290||84,290||84,290|
|Cash flow from operating activities||3.5||8.8||0.7||10.8|
|Net interest-bearing debt at end of period||33.6||33.0|
|Return on investment (ROI), %, (annualized)||-0.4%||-1.3%|
|Comparable return on capital employed (ROCE), %, (annualized)||4.7%||8.7%|
|Equity ratio, %||41.2%||41.6%|
|Net gearing, %||48.8%||45.0%|
|Number of employees at end of period||723||790|
Glaston Corporation’s acquisition of Bystronic glass was completed on 1 April 2019. The comparison data for the period 1 January – 31 March 2019 do not include figures for Bystronic glass. Glaston Corporation has prepared unaudited pro forma financial information to illustrate the impact of the Bystronic glass acquisition on the Group’s operational result and financial position and to improve the comparability of financial information. The unaudited pro forma financial information for 1 January – 31 December 2019 in this interim report is presented as if the acquisition would have already been completed on 1 January 2019. Pro forma financial information has been titled Pro forma information in the parts of the interim report in which the information is presented.
UNCERTAINTIES AND FACTORS AFFECTING NEAR FUTURE DEVELOPMENT
In the fourth quarter of 2020, the global community adapted on a step-by-step basis to the “new normal” characterized by the pandemic, and market activity increased in Glaston’s market segments. Recent vaccine development and approvals also raised hopes of a turnaround in the pandemic later in 2021. Nevertheless, near-term risks continue to be mainly related to the impacts of the COVID-19 pandemic. The uncertainty related to the pandemic prevails as the situation might change quickly for the worse with new lock-downs, new variants of the virus, a slow rollout of vaccinations and a shortfall of doses. Thus higher-than-normal uncertainty is related to customers’ investment behavior.
ANALYST AND PRESS MEETING
Glaston’s President and CEO Anders Dahlblom and CFO Päivi Lindqvist will present the financial result to analysts, investors and media representatives on the same day at 14.30 in a live webcast that can be joined through this link: https://glaston.videosync.fi/2021-q4-tulos .
A recording of the meeting including the presentation will be available on the company’s internet pages www.glaston.net after the meeting.
For further information, please contact:
President & CEO Anders Dahlblom, tel. +358 10 500 500
Chief Financial Officer Päivi Lindqvist, tel. +358 10 500 500
VP, IR, Communications and Marketing
Tel. +358 10 500 500
Glaston in brief
Glaston is the glass processing industry’s innovative technology leader supplying equipment, services and solutions to the architectural, automotive, solar and appliance industries. The company also supports the development of new technologies integrating intelligence to glass.
Glaston is committed to providing its clients with both the best know-how and the latest technologies in glass processing, with the purpose of building a better tomorrow through safer, smarter, and more energy efficient glass solutions. Glaston operates globally with manufacturing, services and sales offices in 10 countries and its shares (GLA1V) are listed on NASDAQ Helsinki Ltd.
Distribution: NASDAQ Helsinki Ltd, key media, www.glaston.net