Componenta to boost capacity utilization at foundries and improve profitability by expanding the current efficiency programme

The Componenta efficiency improvement programme launched in October 2012 to boost productivity and profitability has made progress in line with the targets set, and the company will achieve annual cost savings of EUR 25 million by the end of 2014.

New development projects to expand efficiency improvement programme targeting EUR 10 million improvement in profitability

The uncertainty in market developments in Europe since autumn 2012 has stabilized, but the growth outlook remains still modest. Componenta is broadening the current efficiency programme with following new projects that particularly focus on raising foundry capacity utilization rates, developing processes and improving profitability by EUR 10 million in 2015.

• Orhangazi foundry in Turkey: Process improvements in melting operations and the foundry sand system: Productivity and quality are improved and uses of raw materials in the production processes are minimized. These measures are carried out by utilizing the company’s best practices.
• Heerlen furan foundry in the Netherlands: Capacity utilization rate improvements and further development of productivity. These measures include boosting new sales, further developing productivity through better production planning and management and faster throughput times, and improving the quality.
• Finnish foundries: Capacity utlization rate improvement and fixed cost reductions. The possible merger of the Pietarsaari foundry with the Pori foundry would strengthen the company’s competitive edge in serving Nordic customers flexibly and cost efficiently.
• Machine shop division: Expansion of the cost efficiency and productivity improvement project.Internal product transfers from Främmestad machine shop in Sweden to the Orhangazi machine shop in Turkey will continue, and development of productivity will continue in Orhangazi machine shop to ensure the cost benefits are achieved from the transferred volumes.

These new projects will become part of the current efficiency improvement programme. Some of the measures started now will improve profitability already in 2014. 

Company to invest in production processes, reducing emissions to environment and cutting waste

As part of the efficiency improvement programme, Componenta will invest a total of EUR 5.5 million in developing production processes and cutting the amount of waste at the Orhangazi foundry and in reducing emissions to the environment at the Heerlen foundry. At the Orhangazi foundry in Turkey, the foundry sand system will be renewed, which will bring a significant reduction in the amount of waste sand.  The new sand system will improve efficiency in the casting process and raise the quality of both the process and the cast components. It will also reduce material costs and the amount of fettling work on castings. The new system will be taken into use by the end of summer 2014.

The investment at the Heerlen foundry in the Netherlands will significantly reduce odour emissions from the foundry, and in future emissions from the foundry will stay below the new permit limits. Componenta’s share of the investment is estimated to be some EUR 1.8 million, which is included in the total figure of EUR 5.5 million mentioned above. The state of the Netherlands, province of Limburg and the commune of Heerlen will contribute EUR 4.2 million to the environmental investment at the Heerlen foundry. The investment will be carried out in the summer of 2014. 

Helsinki, 30 September 2013

COMPONENTA CORPORATION
 

Heikki Lehtonen
President and CEO

For further information, please contact:

Heikki Lehtonen
President and CEO
tel. +358 10 403 2200

Mika Hassinen
CFO
tel. +358 10 403 2723

Componenta is a metal sector company with international operations and production plants located in Finland, Turkey, the Netherlands and Sweden. The net sales of Componenta were EUR 545 million in 2012 and its share is listed on the NASDAQ OMX Helsinki. The Group employs approx. 4,300 people. Componenta specializes in supplying cast and machined components and total solutions made of them to its global customers, who are manufacturers of vehicles, machines and equipment.