Componenta Corporation’s Half-year Financial Report 1 January – 30 June 2019: Decreased deliveries in Sweden weakened EBITDA. Net cash flow from operating activities doubled.
Componenta Corporation Stock Exchange Release on 2 August 2019 at 8.00
The information presented in this Half-year Financial Report relates to the development of Componenta Group in January-June 2019 and in the corresponding period in 2018, unless otherwise stated.
January-June, H1 2019
- Net sales decreased to EUR 59.1 million (EUR 66.1 million).
- EBITDA decreased to EUR 1.6 million (EUR 2.7 million).
- Operating result decreased to EUR 0.8 million (EUR 1.7 million).
April-June, Q2 2019
- Net sales decreased to EUR 28.0 million (EUR 32.8 million).
- EBITDA decreased to EUR 0.4 million (EUR 1.3 million).
- Operating result decreased to EUR 0.1 million (EUR 0.8 million).
Guidance for 2019
Componenta updated the guidance for 2019 in its Business Review published on 16 May 2019. Componenta expects net sales to be EUR 90-110 million in 2019. EBITDA is expected to remain positive. Net sales in 2018 were EUR 120.7 million and EBITDA EUR 3.7 million.
The guidance is based in the assumption that the transaction of shares will be closed on 30 August 2019. Additionally, potential fluctuations in exchange rates, higher raw materials prices and the general competitive climate may affect the business outlook. Changes to new accounting principles are not expected to have significant impact on the future financial statement.
Harri Suutari, CEO:
The profitability of the first half-year weakened compared to the comparison period. The weakening can almost solely be explained with reduction of operations in Sweden. Part of the weakening is explained with the advisory fees related to Komas acquisition. The underlying factors of the reduction of operations in Sweden is related to the termination of one customer agreement in 2018. Componenta’s possibilities for profitable operation with the customer in question, became impossible after the divestment of Turkish operations in 2017. In terms of Componenta’s business scope and profitability, the first half-year in Finland proceeded better than in the comparison period.
Componenta aims to improve profitability and reduce capital employed in business operations in Sweden. The downscaling activities are in progress and their impacts will be visible with a delay. Due to the procedures of termination of employment, the manufacturing costs are decreasing more slowly than the volumes of business. The costs of downscaling will burden the business of Componenta Främmestad AB also for the rest of the year. Componenta Främmestad AB is negotiating for agreements with customers. If these downscaling activities and negotiations for agreements do not result in required profitability, the ability for Componenta Främmestad AB to continue as a going concern is jeopardized.
The net cash flow from operations were EUR 7.3 million. The improved net cash flow from operations is mainly a result from decreased working capital.
The company signed an agreement, during the reporting period, on purchasing Komas Oy. This arrangement strengthens Componenta’s competitiveness in the long run by improving the level of expertise in the company and the ability to offer more integrated services to customers. The acquisition of Komas was not closed yet during July 2019 because of absent of one approval from authorities. We expect to receive this approval during August.
Key figures
| MEUR | 1-6/2019 | 1-6/2018 | Change | 1-12/2018 |
| Net sales | 59.1 | 66.1 | -10.6% | 120.7 |
| EBITDA | 1.6 | 2.7 | -41.1% | 3.7 |
| Operating result | 0.8 | 1.7 | -54.1% | 1.2 |
| Operating result, % | 1.3 | 2.6 | -48.6% | 1.0 |
| Result after financial items | 0.7 | 1.6 | -56.1% | 1.2 |
| Net result | 0.7 | 1.4 | -50.3% | 1.0 |
| Basic earnings per share, EUR | 0.01 | 0.01 | -50.3% | 0.01 |
| Diluted earnings per share, EUR | 0.01 | 0.01 | -50.3% | 0.01 |
| Interest-bearing net debt* | -9.0 | -4.6 | 96.1% | -3.4 |
| Return on equity, % | 7.2 | 15.3 | -52.8% | 5.6 |
| Return on investment, % | 7.3 | 16.2 | -54.8% | 6.0 |
| Equity ratio, % | 39.1 | 35.8 | 9.2% | 39.3 |
| Gross investment including lease liabilities recognized in balance sheet | 1.0 | 0.9 | -10.8% | 1.8 |
| Cash flow from operating activities | 7.9 | 3.7 | 46.8% | 3.5 |
| Group’s restructuring debt | 15.2 | 16.1 | -4.8% | 16.0 |
| Average number of personnel incl. leased personnel | 655 | 710 | -7.7% | 703 |
| Number of personnel at end of period incl. leased personnel | 611 | 728 | -16.1% | 668 |
| Order book | 9.6 | 16.2 | -40.4% | 21.7 |
*) Only interest-bearing restructuring debts included.
Alternative performance measures
Componenta has ended the reporting of adjusted net sales, adjusted EBITDA and adjusted operating result presented as alternative performance measures. Componenta will continue to publish certain publicly available performance measures that can be derived from the IFRS financial statements. The calculation of these key financial figures is presented at the end of this Half-year Financial Report.
Componenta’s Half-year Financial Report 1 January – 30 June 2019 in pdf format is in the appendix to this release. It is also available on the company’s websites at www.componenta.com.
COMPONENTA CORPORATION
Harri Suutari
President and CEO
For further information, please contact:
Harri Suutari
President and CEO
tel. +358 10 403 2200
Marko Karppinen
CFO
tel. + 358 10 403 2101
Componenta is an international technology company. Componenta specializes in supplying cast and machined components to its global customers, who are manufacturers of vehicles, machines and equipment. The company’s share is listed on Nasdaq Helsinki.