Etteplan in 2014: Clear improvement in operating profit and cash flow

ETTEPLAN OYJ FINANCIAL STATEMENT RELEASE FEBRUARY 11, 2015 AT 02.00 P.M.

ETTEPLAN IN 2014: CLEAR IMPROVEMENT IN OPERATING PROFIT AND CASH FLOW

Review period October-December 2014

- The Group’s revenue increased by 9.0% and was EUR 35.4 million
  (10-12/2013: EUR 32.4 million).
- EBITDA improved by 85.8% and was EUR 3.4 million (EUR 1.8 million).
- Operating profit (EBIT) improved by 134.8% and was EUR 2.7 million (EUR 1.1 million).
  The operating profit includes non-recurring items with a total positive effect of
   EUR 0.2 million (EUR -0.3 million).
- The profit for the review period improved and was EUR 2.2 million (EUR 0.9 million).
- Operating cash flow improved and was EUR 6.9 million (EUR 4.2 million).
- Earnings per share were EUR 0.11 (EUR 0.04).
- The number of personnel increased and the Group had 1,859 employees
  at the end of the period (1,728).

Review period January-December 2014

- The Group’s revenue increased by 2.5% and was EUR 131.9 million
  (1-12/2013: EUR 128.6 million).
- EBITDA improved by 15.7% and was EUR 10.5 million (EUR 9.1 million).
- Operating profit (EBIT) improved by 23.4% and was EUR 7.9 million (EUR 6.4 million).
  The operating profit includes non-recurring items with a total positive effect of
   EUR 0.8 million (EUR 0.2 million).
- The profit for the review period improved and was EUR 6.1 million (EUR 4.4 million).
- Operating cash flow improved and was EUR 7.8 million (EUR 1.8 million).
- Earnings per share were EUR 0.30 (0.22).
- The Board of Directors proposes a dividend of EUR 0.15 per share (EUR 0.11 per share).

Market outlook 2015

The most important factor in the development of Etteplan’s business operations is the global development of the machinery and metal industry. Market development remains uncertain due to the political and economic situation in Europe. Etteplan’s customers also operate in the North American and Asian markets, where the demand situation is better than in Europe.

Financial guidance 2015

We expect the revenue and operating profit for the year 2015 to grow compared to 2014.

Key figures

Juha Näkki, President and CEO of Etteplan Oyj comments the financial statement release:

“After a slow start to 2014, we managed to turn our business to profitable growth in the second half of the year as orders received by our customers increased and the order books turned to growth in several industries. In the fourth quarter, product development projects were also started at a rate that was somewhat higher than in the previous quarters. We accelerated toward the end of the year and, in a slightly improved demand situation, achieved a strong result in the fourth quarter. Operating profit and cash flow improved clearly and revenue grew. The improvement in profitability was particularly attributable to the increase in the share of revenue represented by Managed Services, which continued throughout the year, and the successful improvement of the results of less profitable units. Our market position strengthened throughout the year and supported growth particularly in Finland and China, with the number of employees at a record high in both countries at the end of the year.

The implementation of our strategy progressed well during the year. The share of Managed Services grew throughout the year and exceeded 40 per cent of our revenue in the fourth quarter. Interest in our cost-efficient service solutions was at a good level and we signed several significant agreements during the year. The demand for outsourcing solutions also grew, particularly in the area of technical documentation, where our service offering and software are unique in the market. We carried out several outsourcings during the year as our customers focused on their core business. I am confident that this trend will continue and offer excellent growth opportunities for us going forward.

Our Chinese business achieved excellent development during the year. The number of working hours sold in the Chinese market grew by over 100 per cent during the year and we opened our third office in Suzhou. Growth in China slowed in the fourth quarter due to a large project that began in the comparison period and was completed in summer 2014. The development of the Chinese market presents massive growth potential for us and we will continue to invest in the continued growth of our business. I expect growth to continue in 2015, but the relative growth of revenue will be slower than in 2014.

I am satisfied with our development in 2014. We were successful in areas of strategic importance and I am confident that our positive development will continue in 2015 in spite of market uncertainty.”

Disclosure procedure

Etteplan follows the disclosure procedure enabled by Disclosure obligation of the issuer (7/2013) published by the Finnish Financial Supervision Authority. This stock exchange release is a summary of Etteplan’s January-December 2014 financial statement release. The complete financial statement release is attached to this stock exchange release in pdf format and is also available on Etteplan’s website at www.etteplan.com. Investors are advised to review the complete financial statement release with tables.

Conference call and live webcast today, February 11, 2015

Etteplan’s President and CEO Juha Näkki will present Company’s results for 2014 in a conference call and a live webcast for analysts and investors, held in English language, on February 11, 2015 starting at 3.30 p.m. Finnish time (EET).

To participate in the conference call please dial 5-10 minutes prior to the start of the conference to +358 9 2319 5437, event password is Etteplan2015. Questions can be asked in English after President and CEO’s presentation only through conference call connection.

Juha Näkki’s presentation can be followed as a live webcast though a link at Etteplan’s homepage at www.etteplan.com/Investors. The live webcast starts at 3.30 p.m. Finnish time (EET).

A recording of the webcast will be later available at the same address.

Vantaa, February 11, 2015

Etteplan Oyj

Board of Directors

Additional information:
Juha Näkki, President and CEO, tel. +358 400 606 372

The information presented herein has not been audited.

Releases and other corporate information are available on Etteplan’s Web site at www.etteplan.com.

DISTRIBUTION:
NASDAQ OMX Helsinki
Major media
www.etteplan.com

Etteplan provides engineering services and technical documentation solutions to the world's leading companies in the manufacturing industry. Our services are geared to improve the competitiveness of our customers' products and engineering processes throughout the product life cycle. The results of Etteplan's innovative engineering can be seen in numerous industrial solutions and everyday products.

In 2014, Etteplan had a turnover of EUR 131.9 million. The company has more than 1,800 professionals in Finland, Sweden, the Netherlands and China. Etteplan's shares are listed on NASDAQ OMX Helsinki Ltd under the ticker ETT1V.