Ovako publishes its Year-End Report 2017

Today Ovako announced its fourth quarter and full year results 2017. For the full year EBITDA before restructuring costs improved to EUR 100 (57) million and order intake grew by 24 percent compared to previous year. Ovako’s restructuring program is proceeding ahead of plan and has delivered savings of EUR 20 million on an annual basis. At the end of the year the group had a liquidity buffer of EUR 90 (88) million.

Fourth quarter 2017 (2016)

  •  Order intake increased by 29 percent compared to the previous year and the order stock was significantly higher compared to the start of the year
  •  Sales volume was 205 (177) thousand metric tons, 16 percent higher than in the previous year, and revenue rose by 26 percent to EUR 246 (196) million
  •  Strong growth combined with favorable development of the product mix and selling prices contributed to an increase in EBITDA before restructuring costs to EUR 29 million from EUR 5 million in the preceding year
  •  Cash flow from operating activities amounted to EUR 18 (21) million, including payment of restructuring costs of EUR 1 (2) million

Full-year 2017 (2016) 

  •  Order intake increased by 24 percent compared to the previous year
  •  Sales volume was 783 (708) thousand metric tons, 11 percent higher than in the previous year, and revenue rose by 18 percent to EUR 921 (781) million
  •  EBITDA before restructuring costs improved substantially to EUR 100 million from EUR 57 million, corresponding to an EBITDA margin of 11 (7) percent. Earnings were strengthened by higher volumes, a better product mix, higher prices and lower costs achieved in the restructuring program
  •  Cash flow from operating activities amounted to EUR 39 (35) million, including payment of restructuring costs of EUR 4 (8) million
  •  Ovako’s restructuring program is proceeding ahead of plan and contributed EUR 20 million in the form of lower costs during the year

“We ended 2017 on the same positive note as we began, with higher order intake, increased deliveries and significantly stronger financial performance. We took market shares during the year while implementing much-needed price adjustments. Even though we have significantly increased manned capacity, we continued to deliver on our cost savings program and thereby strengthened our competitive advantage. We are now in a better position than we have been for quite some time and are well prepared to continue generating growth for Ovako”, says Marcus Hedblom, President and CEO at Ovako.

Group KPIs

2017 Q4 2016 Q4 2017 Full Year 2016 Full Year
Sales volumes  kton 205 177 783 708
Revenue  EURm 246 196 921 781
EBITDA before restructuring cost  EURm 29 5 100 57
Adjusted EBITDA margin   11.7 % 2.8 % 10.8 % 7.3 %
Operating profit (EBITA) before restructuring cost EURm 21 -3 69 25
Adjusted operating margin (EBITA)    8.6 % -1.4 % 7.4 % 3.2 %
EBIT  EURm 18 -7 56 9
Net profit/loss  EURm 2 -10 15 -17
Cash flow from operating activities  EURm 18 21 39 35
Net debt (excl pension liabilities)/equity ratio    219 % 218 % 219 % 218 %
Full time employees at end of period (FTE)  No 3,040 2,773 3,040 2,773

Short-term outlook

In light of continued high industrial activity among our customers, increased manned capacity in several of our production flows and a strong order book, we expect sales volume in the first quarter 2018 to be higher than in the same period last year.

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For more information please contact:

Investor relations
Stina Thorman, Head of Investor Relations
Telephone: +46 (0)862 13 38
E-mail: stina.thorman@ovako.com

About Ovako

Ovako develops high-tech steel solutions for, and in cooperation with, its customers in the bearing, transport and manufacturing industries. Our steel makes our customers’ end products more resilient and extends their useful life, ultimately resulting in smarter, more energy-efficient and more environmentally-friendly products.

Our production is based on recycled scrap and includes steel in the form of bar, tube, ring and pre-components. Ovako is represented in more than 30 countries, and has sales offices in Europe, North America and Asia. Ovako’s sales in 2017 amounted to EUR 921 million, and the company had 3,040 employees at year-end. For more information, please visit us at www.ovako.com.

This information is information that Ovako AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 8.00 CET on February 9, 2018.

About Us

About OvakoOvako develops high-tech steel solutions for, and in cooperation with, its customers in the bearing, transport and manufacturing industries. Our steel makes our customers’ end products more resilient and extends their useful life, ultimately resulting in smarter, more energy-efficient and more environmentally-friendly products. Our production is based on recycled scrap and includes steel in the form of bar, tube, ring and pre-components. Ovako has over 3,000 employees in more than 30 countries. Ovako’s sales in 2017 amounted to EUR 921 million. Since June 2018, Ovako is part of the Japanese steel corporation Nippon Steel & Sumitomo Metal Corporation that employs 92,000 globally and has a revenue of EUR 37 billion. For more information, please visit us at www.ovako.com and www.nssmc.com.