Glaston Interim Report 1 January - 31 March 2009
GLASTON CORPORATION Stock Exchange Release 5 May 2009 9.00 a.m.
Glaston Interim Report 1 January - 31 March 2009
- Orders received in January-March totalled EUR 24.5 (68.3) million.
- Glaston's order book on 31 March 2009 was EUR 45.9 (96.9) million.
- Consolidated net sales in January-March totalled EUR 39.2 (63.1) million.
- The operating result in January-March was a loss of EUR 9.0 (1.6 profit)
million, representing -22.9 (+2.6)% of net sales.
- Return on capital employed (ROCE) was -17.1 (+4.1)%
- January-March earnings per share were EUR -0.10 (0.01).
- Due to a weak order book for the beginning of 2009 and exceptionally low
demand, Glaston expects 2009 net sales to fall short of the 2008 level and
the operating result to remain loss-making in the second quarter of the year.
President & CEO Mika Seitovirta:
“The glass processing machine market came to a halt in the final quarter of
2008. The inactive market situation continued in the first quarter in nearly all
the market areas. The economic downturn and the dysfunctional financial markets
influenced customers' investment needs and decisions.
The sharp decline in net sales affected Glaston's very weak financial
performance. The cost-cutting measures initiated have not yet had a
corresponding impact during the review period.
In April we began to adjust our structure, in addition to the efficiency
programmes already under way. The restructuring is directed particularly at the
machine business. The Pre-processing and Heat Treatment business areas will be
merged to the Machines business area. In addition to this, the product portfolio
and manufacturing footprint will be rationalised. As part of the re-structuring,
our factory in Cinnaminson, USA will be closed.
The cost savings from the efficiency measures initiated this year and last are
estimated to total EUR 15 million. The savings will be implemented mainly during
2009. The cost savings of the first quarter (excluding material expenses)
totalled EUR 3.7 million compared with the corresponding period the previous
year.
The architectural and insulating glass processing operations of the heavily
loss-making Tamglass Glass Processing were sold during the review period.”
Markets
The sharp weakening of demand that began in the final quarter of 2008 continued
during the review period. All market areas, except for South America, came to a
halt. The emphasis of machine sales was on sales of single machines. There was
no demand for extensive One-Stop-Partner sales.
Pre-processing
The strong slowing of the Pre-processing market that began at the end of 2008
continued during the early part of the year. Demand for glass pre-processing
machines weakened in all market areas, except for South America.
To boost sales, a customer event was arranged in Italy in March. The event was
attended by more than 300 customers from around 30 different EMEA countries.
During the review period, the strengthening of the global tool sales
organisation continued. New cooperation and agency agreements were signed, for
example, in the EMEA area and the United States.
The weak market situation affected the business area's new orders and result.
Orders received in January-March totalled EUR 8.0 (19.4) million. January-March
net sales totalled EUR 11.1 (22.9) million.
Heat Treatment
The strong weakening of demand that began in the final quarter of 2008
intensified during the review period. The economic downturn and the unstable
financial markets influenced customers' investment decisions.
Demand in the South American market continued to be good. The biggest proportion
of orders in the review period continued to come, however, from the main market
area, EMEA. Overall, however, the volume of orders received was significantly
below the level for the corresponding period in 2008.
Measures to strengthen market position were continued. Development of
manufacturing operations was continued by localising manufacturing of
continuously operating flat tempering machines in China. The first sale of a CHF
machine manufactured in China was signed in January. The building of a global
sourcing organisation was continued by increasing resources in Finland and in
Italy.
In product development, the development of flat tempering was in focus and the
product development of solar energy glass tempering was continued. The product
development and manufacturing of Uniglass products was transferred to Glaston's
Tampere factory and measures initiated to merge the sales organisations.
The Heat Treatment business area's January-March net sales totalled EUR 22.2
(32.9) million. In the review period, orders received totalled EUR 14.1 (44.0)
million. Profitability weakened compared with the previous year, despite the
initiated cost-cutting measures. Due to the weakened market situation, new
measures were initiated to lower costs by increasing adjustment measures and by
extending them to cover a wider group of employees than before.
The restructuring of Tamglass Glass Processing continued in the review period.
On 31 March, Glaston sold the insulation and architectural glass business of
Tamglass Glass Processing to INTERPANE Glass Oy.
Software Solutions
Economic downturn had a substantial impact on the activity of the Software
Solutions business area in the first quarter. Demand in the United States and in
China came to a halt. The Central European market remained stable.
The product development priorities were a higher degree of automation as well as
integration and flexibility. The Panorama line control system, which enables
control and observation of entire production lines on a network, was developed
further. In China a major pilot project, with a fully integrated software system
beeing implemented, was started during the review period.
January-March net sales totalled EUR 6.0 (7.3) million. Licence orders received
totalled EUR 2.4 (4.8) million.
One-Stop-Partner
Demand for extensive One-Stop-Partner projects dried up during
the final quarter of 2008 and there has been no recovery during the review
period. Customers' interest was directed at capacity expansion and upgrade
projects.
Total sales of One-Stop-Partner deliveries totalled EUR 1.2 (2.1) million in
January-March. The unit's earnings are included in Glaston's reporting segments.
The market for solar energy One-Stop-Partner projects still exists and Glaston's
position in this customer segment is strong. The economic downturn and the
uncertainty in the financial markets have postponed customers' investment
decisions, however.
Orders received
Glaston's order intake during the first quarter was EUR 24.5 (68.3) million. Of
orders received, Heat Treatment accounted for 57.5%, Pre-processing 32.7% and
Software Solutions 9.8%.
Geographical distribution of orders received, EUR million
--------------------------------------------------------------------------------
| | 1-3/2009 | 1-3/2008 | Change, % |
--------------------------------------------------------------------------------
| EMEA | 13.3 | 42.4 | -68.6 |
--------------------------------------------------------------------------------
| America | 7.3 | 11.3 | -35.4 |
--------------------------------------------------------------------------------
| Asia | 3.8 | 14.5 | -73.7 |
--------------------------------------------------------------------------------
| Total | 24.5 | 68.3 | -64.1 |
--------------------------------------------------------------------------------
Order book
Glaston's order book on 31 March, 2009 was EUR 45.9 (96.9) million. The Heat
Treatment business area accounted for EUR 28.7 million of the order book,
Pre-processing for EUR 13.5 million and Software Solutions for EUR 3.7 million.
--------------------------------------------------------------------------------
| Order book, EUR million | 31.3.2009 | 31.3.2008 |
--------------------------------------------------------------------------------
| Pre-processing | 13.5 | 21.0 |
--------------------------------------------------------------------------------
| Heat Treatment | 28.7 | 66.4 |
--------------------------------------------------------------------------------
| Software Solutions | 3.7 | 9.5 |
--------------------------------------------------------------------------------
| Total | 45.9 | 96.9 |
--------------------------------------------------------------------------------
Net sales and operating result
Glaston's net sales in the review period were EUR 39.2 (63.1) million.
Pre-processing's net sales in January-March were EUR 11.1 (22.9) million, Heat
Treatment's net sales EUR 22.2 (32.9) million and Software Solutions' net sales
EUR 6.0 (7.3) million.
Exceptionally weak demand affected net sales in the financial period. The
prevailing uncertainty in the market influenced customers' investment decisions
and led to the postponement of projects.
--------------------------------------------------------------------------------
| Net sales, EUR million | 1-3/2009 | 1-3/2008 | 1-12/2008 |
--------------------------------------------------------------------------------
| Pre-processing | 11.1 | 22.9 | 89.7 |
--------------------------------------------------------------------------------
| Heat Treatment | 22.2 | 32.9 | 152.9 |
--------------------------------------------------------------------------------
| Software Solutions | 6.0 | 7.3 | 28.2 |
--------------------------------------------------------------------------------
| Parent company, elim. | 0.0 | 0.0 | -0.3 |
--------------------------------------------------------------------------------
| Total | 39.2 | 63.1 | 270.4 |
--------------------------------------------------------------------------------
The operating result in January-March was a loss of EUR 9.0 (1.6 profit)
million, representing -22.9 (+2.6)% of net sales. Of the first-quarter operating
loss, the Pre-processing business area accounted for EUR -4.4 million, Heat
Treatment for EUR -2.6 million and Software Solutions for EUR -0.4 million.
Pre-processing's weaker than expected operating result was due to very weak
demand and tightened price competition.
Tamglass Glass Processing's operating loss of EUR 2.2 (1.6 loss) million
significantly weakened the result of the Heat Treatment business area. The
figure also includes the operating loss for the business operations sold at the
end of the review period. The Heat Treatment business area's operating result
was also weakened by a sharp decline in sales.
Operational adjustment and efficiency measures were insufficient to balance the
significantly declining net sales.
--------------------------------------------------------------------------------
| Operating result, EUR million | 1-3/2009 | 1-3/2008 | 1-12/2008 |
--------------------------------------------------------------------------------
| Pre-processing | -4.4 | 0.6 | -3.0 |
--------------------------------------------------------------------------------
| Heat Treatment | -2.6 | 1.9 | 13.0 |
--------------------------------------------------------------------------------
| Software Solutions | -0.4 | 1.0 | 3.7 |
--------------------------------------------------------------------------------
| Parent company, elim. | -1.6 | -1.8 | -7.5 |
--------------------------------------------------------------------------------
| Operating result, total | -9.0 | 1.6 | 6.2 |
--------------------------------------------------------------------------------
| Non-recurring items | - | - | -12.3 |
--------------------------------------------------------------------------------
| Operating result after | -9.0 | 1.6 | -6.1 |
| non-recurring items | | | |
--------------------------------------------------------------------------------
The result for the financial period was a loss of EUR 8.1 (0.6 profit) million.
Return on capital employed (ROCE) was -17.1 (+4.1)% and earnings per share were
EUR -0.10 (0.01).
Efficiency programme
To improve profitability, Glaston initiated efficiency measures in all units in
September 2008. The objective of the efficiency programme is to improve the
profitability of the whole group and of the Pre-processing business area in
particular, as well as to adjust the operations to the market situation.
In January-March Glaston continued the measures it had initiated. Negotiations
held with personnel representatives in Finland were completed in March. The
outcome was that all Glaston Finland Oy personnel excluding maintenance staff, a
total around 200 people, were decided to be temporarily laid off for 10-18
weeks.
In the Pre-processing business area, 25% of personnel, i.e. 100 people, have
been regularly temporarily laid off since December 2008. Personnel reductions
and adjustments will also be made in a number of the Group's other units, and
these will be implemented mainly during the first half of the 2009.
During the first quarter, Glaston announced the redundancy of 155 employees, and
of these the employment relationship of 65 has already ended. In addition,
temporary subcontracted workers were reduced by 44.
In the review period, Glaston initiated a rationalisation programme, the
emphasis of which was on the restructuring of machine operations. A production
unit situated in Mexico was closed in March, and in April Glaston announced that
it will close its factory in Cinnaminson in the USA. The streamlining of the
Group structure will also continue.
The cost savings from the efficiency measures initiated now and earlier are
estimated to total EUR 15 million. Related one-off costs for the year 2009 are
estimated to EUR 3.7 million. The savings will be implemented mainly during
2009. The cost savings of the first quarter (excluding material expenses)
totalled EUR 3.7 million compared with the corresponding period in the previous
year.
Financing
The Group's financial position remained reasonable, even though net gearing
continued to grow during the review period. In addition to dividends paid during
the financial period, the Group's financial position was affected mainly by
changes in net working capital and cash flow from operating activities. Net
working capital was reduced as part of the initiated efficiency programme
(EUR +4.4 million), but cash flow from operating activities excluding the change
in net working capital was negative (EUR -8.1 million) in the period under
review. Cash flow from investing activities was EUR -2.9 (-3.1) million. Cash
flow from financing activities in January-March was EUR 3.2 (8.4) million,
including dividends paid in the review period of EUR 3.6 (7.2) million.
The equity ratio on 31 March, 2009 was 44.3 (52.2)%.
The Group's liquid funds at the end of the period totalled EUR 8.8 (16.4)
million. Interest-bearing net debt totalled EUR 66.2 (20.6) million and net
gearing was 58.7 (15.7)%. To ensure liquidity, the Group has a EUR 65 million
committed revolving credit facility. At the end of March, EUR 32.2 million of
the facility was in use.
Capital expenditure and depreciation
Glaston's gross capital expenditure totalled EUR 4.1 (3.3) million. The most
significant capital expenditure was related to the global ERP project as well as
to a joint venture founded in connection with the sale of the glass processing
operations.
During the financial period, depreciation and amortisation of property, plant
and equipment as well as intangible assets totalled EUR 2.2 (2.0) million. In
addition, impairment losses totalling EUR 0.4 (0.0) million on property, plant
and equipment as well as intangible assets were recognised in the period.
Group structural changes
As part of an efficiency programme initiated last year, operations of Uniglass
Engineering Oy were transferred to Glaston's factory in Tampere, Finland.
Operations at the Uniglass factory in Ylöjärvi, Finland ended on 31 March, 2009.
Glaston's Tamglass Glass Processing Ltd. sold its insulation and architectural
glass processing operations to INTERPANE Glass Oy in March. Around 90 people
were employed in the sold operations. The net sales of the sold operations
totalled around EUR 14 million in 2008. As of 1 April, 2009, glass processing
operations consists only of solar reflector production at Akaa, Finland, where
around 30 people are employed. INTERPANE Glass Oy is a joint venture company of
Glaston.
Personnel
On 31 March, 2009, Glaston had a total of 1,480 (1,489) employees, including the
93 Tamglass Glass Processing Ltd.'s employees who transferred to INTERPANE Glass
Oy on 1 April, 2009. Of the Group's employees, 28% were in Finland and 48%
elsewhere in Europe, mainly in Germany and Italy. The proportion of Group
employees working in Asia was 10% and in the Americas 14%. The average number of
employees was 1,490 (1,462). Personnel reductions resulting from the adjustment
of operations will be implemented mainly during the second quarter of the year.
Shares and share prices
Glaston Corporation's paid and registered share capital
on 31 March, 2009 was EUR 12.7 million and the number of issued shares totalled
79,350,000. The company has one series of share. At the end of March, the
company held 813,906 of the company's own shares (treasury shares),
corresponding to 1% of the total number of issued shares and votes. The counter
book value of treasury shares is EUR 130,225. Every share that the company does
not hold itself entitles its owner to one vote at the Annual General Meeting.
The share has no nominal value. The counter book value of each share is EUR
0.16.
On 31 March, 2009, the market capitalisation of the company's shares, treasury
shares excluded, was EUR 78.5 (251.0) million.
During the first quarter of the year, a total of around 2.2 million of the
company's shares were traded, representing 2.8% of the total number of shares.
The lowest price paid for a share was EUR 0.92 and the highest price EUR 1.15.
The volume- weighted average price of shares traded during the review period was
EUR 1.02.
The equity per share attributable to the owners of the parent was EUR 1.43
(1.68).
Decisions of the Annual General Meeting
The Annual General Meeting of Glaston
Corporation was held in Helsinki on 17 March, 2009. The Annual General Meeting
approved the financial statements and consolidated financial statements for 2008
and released the Board of Directors and the President & CEO from liability for
the financial period 1 January-31 December, 2008.
The Annual General Meeting approved a dividend of EUR 0.05 per share,
representing a maximum total sum of around EUR 4.0 million.
The Annual General Meeting confirmed that the following will continue on the
Board of Directors for a year-long term of office: Claus von Bonsdorff, Klaus
Cawén, Jan Lång, Carl-Johan Rosenbröijer, Christer Sumelius and Andreas
Tallberg. The Annual General Meeting decided to maintain the Chairman of the
Board's annual remuneration at EUR 40,000 and the Deputy Chairman's annual
remuneration at EUR 30,000. It was also decided to maintain the remuneration of
the other Members of the Board at EUR 20,000 per year. The Board of Directors
elected in its meeting on 17 March, 2009, Andreas Tallberg to continue as the
Chairman of the Board and Christer Sumelius to continue as the Deputy Chairman
of the Board.
The Annual General Meeting re-elected as auditor the authorised public
accounting firm KPMG Oy Ab, with the responsible auditor being Sixten Nyman,
APA.
The Annual General Meeting approved amendments to the Articles of Association,
as follows: (i) that Section 2 of the Articles of Association be amended by
removing energy production from the field of operations; (ii) that Section 11 of
the Articles of Association be amended such that notice to the General Meeting
be delivered no later than 21 days before the General Meeting; (iii) that
Section 12 of the Articles of Association be amended such that advance notice of
participation in an Annual General Meeting shall be given no later than a given
date, not to be earlier than 10 days before the Annual General Meeting.
Authorisations given by the Annual General Meeting
The Annual General Meeting of Glaston Corporation held on 17 March, 2009
authorised the Board of Directors to decide on the acquisition of the Company's
own shares up to a maximum of 7,000,000 shares. The shares may be acquired to
improve the capital structure of the Company and/or to be used as consideration
in future acquisitions or other arrangements that are part of Company's business
or as part of the Company's share-based incentive scheme, or to finance
investments. The shares acquired for the Company may be held, cancelled or
conveyed. The authorisation is valid for 18 months from the decision of the
Annual General Meeting.
The Annual General Meeting also authorised the Board of Directors to decide on
the issue of new shares and/or the conveyance of the own shares held by the
Company. By virtue of the authorisation, the Board of Directors is entitled to
decide on the issuance of a maximum of 7,800,000 new shares and on the
conveyance of a maximum of 7,800,000 own shares held by the Company. However,
the total number of shares to be issued and/or conveyed may not exceed 7,800,000
shares. The new shares may be issued and own shares held by the Company conveyed
either against payment or without payment. The new shares may be issued and/or
own shares held by the Company conveyed to the Company's shareholders in
proportion to their existing shareholdings in the Company, or by means of a
directed share issue, waiving the pre-emptive subscription right of the
shareholders, if there is a weighty reason for the Company to do so, such as the
shares to be used to improve the capital structure of the Company or as
consideration in future acquisitions or other arrangements that are part of the
Company's business or as part of Company's or its subsidiaries' incentive
schemes. Shares can be issued or conveyed without payment in exception to the
pre-emptive subscription right of shareholders only if there is an especially
weighty reason for the Company to do so, taking the interests of all
shareholders into account.
The Board of Directors may decide on the issue of shares without payment also to
the Company itself. The number of shares to be issued to the Company combined
with the number of shares acquired for the Company under the share acquisition
authorization may not exceed 1/10 of the total number of shares of the Company.
The subscription price of new shares issued and the consideration paid for the
conveyance of the Company's own shares shall be credited to the reserve for
invested unrestricted equity. By virtue of the share issue authorisation, the
Board of Directors shall decide on other matters relating to the issuing and
conveyance of shares. The authorisation is valid until the end of the 2011
Annual General Meeting.
The Board of Directors has no other authorisations.
Conveyance of own shares
The 2007 Annual General Meeting authorised the Board
of Directors to decide on the conveyance of own shares in the Company's
possession (treasury shares). The authorisation was valid until the end of the
2009 Annual General Meeting. During January-March, the company did not convey
any of its own shares.
Events after the review period
Henrik Reims was appointed Senior Vice President, Sales and Marketing as of
1 April, 2009. The Senior Vice President, Sales and Marketing's area of
responsibility includes One-Stop-Partner deliveries.
Glaston announced in a stock exchange release published on 22 April, 2009 that
it will merge the Pre-processing and Heat Treatment business areas into a single
new business area: Machines. Topi Saarenhovi, SVP of the Heat Treatment business
area was appointed SVP of the Machines business area. At the same time, Paolo
Ceni, SVP of the Pre-processing business area, resigned from Glaston's service.
The cost-savings generated by combining the business areas and improving
productivity are estimated to be around EUR 3.5 million on an annual basis.
These will be realised in full from 2010. The combining of the business areas
will cause estimated non-recurring costs of EUR 3.7 million, which will be
recognised mainly in the second quarter 2009.
The merger of the business areas will change Glaston's reporting segments. The
second interim report of 2009, to be published on 12 August, 2009, will be
reported according to the new business structure.
Uncertainties in the near future
As the global financial crisis and the economic
downturn continue, Glaston's current markets have substantially changed. The
world's economic situation has had a significant adverse effect on the
opportunities for Glaston's customers to invest. The instability had a
particularly strong impact on large One-Stop-Partner orders.
Owing to the recession, demand for glass processing machines will continue to be
weak. Customers' financing difficulties mean that orders might be postponed and
those already confirmed may be cancelled. Customers' financial situation also
impacts on the collection of receivables and on credit losses.
Risks relating to raw materials have decreased. Raw material prices have
levelled off and subcontracting capacity problems have nearly disappeared.
Outlook
The inactive market will have a considerable impact on Glaston's
business in 2009. Adjusting operations to the prevailing market situation will
continue.
The cornerstones of Glaston's business remain the architectural glass segment
and the solar energy market. In the economic downturn, the significance of
service and maintenance business will increase.
Market prospects for the first part of the year were very weak, and no signs of
a recovery in the market are perceptible. Prospects for service and maintenance
business are reasonable. The emphasis of new machine business will be on sales
of single machines. No significant demand for One-Stop-Partner projects is
perceptible in the second quarter of the year. Demand for glass processing
machines in the latter part of the year is very difficult to forecast in the
present uncertain economic climate.
Due to a weak order book for the beginning of 2009 and exceptionally low demand,
Glaston expects 2009 net sales to fall short of the 2008 level and the operating
result to remain loss-making in the second quarter of the year.
Helsinki, 5 May 2009
Glaston Corporation
Board of Directors
Sender:
Glaston Corporation
Kimmo Lautanen
Chief Financial Officer
Tel. +358 10 500 500
Agneta Selroos
IR and Communications Manager
Tel. +358 10 500 6105
Further information:
President & CEO Mika Seitovirta, tel: +358 10 500 500
Chief Financial Officer Kimmo Lautanen, +358 10 500 500
Glaston Corporation
Glaston Corporation is a growing, international glass technology company.
Glaston is the global market leader in glass processing machines, and a
comprehensive One-Stop-Partner supplier to its customers. Its product range and
service network are the widest in the industry. Glaston's well-known brands are
Bavelloni in pre-processing machines and tools, Tamglass and Uniglass in safety
glass machines, and Albat+Wirsam Software in glass industry software.
Glaston's share (GLA1V) is listed on the OMX Nordic Exchange Helsinki Mid Cap
List.
www.glaston.net
Distribution:
OMX
Main media
www.glaston.net
GLASTON CORPORATION
CONDENSED INTERIM FINANCIAL STATEMENTS AND NOTES 1 JANUARY - 31 MARCH 2009
These condensed interim financial statements are not audited.
As a result of rounding differences, the figures presented in the tables may not
add up to the total.
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
--------------------------------------------------------------------------------
| EUR million | 31.3.2009 | 31.3.2008 | 31.12.2008 |
--------------------------------------------------------------------------------
| Assets | | | |
--------------------------------------------------------------------------------
| Non-current assets | | | |
--------------------------------------------------------------------------------
| Property, plant and equipment | 29.7 | 34.0 | 35.0 |
--------------------------------------------------------------------------------
| Goodwill | 66.2 | 67.6 | 66.2 |
--------------------------------------------------------------------------------
| Other intangible assets | 23.5 | 19.1 | 22.5 |
--------------------------------------------------------------------------------
| Joint ventures and associates and | 1.8 | 0.8 | 0.9 |
| loan receivables from joint | | | |
| ventures | | | |
--------------------------------------------------------------------------------
| Available-for-sale assets | 0.3 | 0.2 | 0.3 |
--------------------------------------------------------------------------------
| Deferred tax assets | 9.0 | 4.2 | 7.9 |
--------------------------------------------------------------------------------
| Total non-current assets | 130.4 | 125.8 | 132.9 |
--------------------------------------------------------------------------------
| Current assets | | | |
--------------------------------------------------------------------------------
| Inventories | 51.9 | 52.0 | 53.9 |
--------------------------------------------------------------------------------
| Receivables | | | |
--------------------------------------------------------------------------------
| Trade and other receivables | 75.7 | 84.5 | 83.3 |
--------------------------------------------------------------------------------
| Assets for current tax | 3.4 | 1.5 | 4.4 |
--------------------------------------------------------------------------------
| Total receivables | 79.1 | 86.0 | 87.6 |
--------------------------------------------------------------------------------
| Cash equivalents | 8.8 | 16.4 | 11.5 |
--------------------------------------------------------------------------------
| Assets held for sale | - | 0.3 | - |
--------------------------------------------------------------------------------
| Total current assets | 139.8 | 154.7 | 153.1 |
--------------------------------------------------------------------------------
| Total assets | 270.2 | 280.5 | 285.9 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 31.3.2009 | 31.3.2008 | 31.12.2008 |
--------------------------------------------------------------------------------
| Equity and liabilities | | | |
--------------------------------------------------------------------------------
| Equity | | | |
--------------------------------------------------------------------------------
| Share capital | 12.7 | 12.7 | 12.7 |
--------------------------------------------------------------------------------
| Share premium account | 25.3 | 25.3 | 25.3 |
--------------------------------------------------------------------------------
| Other reserves | 0.0 | - | - |
--------------------------------------------------------------------------------
| Reserve for invested unrestricted | 0.2 | 0.3 | 0.2 |
| equity | | | |
--------------------------------------------------------------------------------
| Treasury shares | -3.5 | -3.9 | -3.5 |
--------------------------------------------------------------------------------
| Fair value reserve | 0.0 | - | 0.0 |
--------------------------------------------------------------------------------
| Hedging reserve | - | 0.0 | - |
--------------------------------------------------------------------------------
| Retained earnings and exchange | 85.8 | 96.7 | 98.2 |
| differences | | | |
--------------------------------------------------------------------------------
| Net result attributable to owners | -8.1 | 0.6 | -9.1 |
| of the parent | | | |
--------------------------------------------------------------------------------
| Equity attributable to owners of | 112.4 | 131.6 | 123.7 |
| the parent | | | |
--------------------------------------------------------------------------------
| Non-controlling interest | 0.4 | 0.0 | 0.0 |
--------------------------------------------------------------------------------
| Total equity | 112.8 | 131.7 | 123.8 |
--------------------------------------------------------------------------------
| Non-current liabilities | | | |
--------------------------------------------------------------------------------
| Non-current interest-bearing | 16.3 | 1.9 | 16.4 |
| liabilities | | | |
--------------------------------------------------------------------------------
| Non-current interest-free | 7.6 | 8.7 | 8.0 |
| liabilities and provisions | | | |
--------------------------------------------------------------------------------
| Deferred tax liabilities | 8.5 | 8.6 | 8.4 |
--------------------------------------------------------------------------------
| Total non-current liabilities | 32.4 | 19.2 | 32.9 |
--------------------------------------------------------------------------------
| Current liabilities | | | |
--------------------------------------------------------------------------------
| Current interest-bearing | 58.7 | 35.1 | 53.0 |
| liabilities | | | |
--------------------------------------------------------------------------------
| Current provisions | 8.9 | 2.7 | 10.6 |
--------------------------------------------------------------------------------
| Trade and other payables | 56.4 | 90.2 | 63.8 |
--------------------------------------------------------------------------------
| Liabilities for current tax | 1.0 | 1.6 | 1.9 |
--------------------------------------------------------------------------------
| Total current liabilities | 125.0 | 129.6 | 129.3 |
--------------------------------------------------------------------------------
| Total liabilities | 157.4 | 148.8 | 162.2 |
--------------------------------------------------------------------------------
| Total equity and liabilities | 270.2 | 280.5 | 285.9 |
--------------------------------------------------------------------------------
CONDENSED CONSOLIDATED INCOME STATEMENT
--------------------------------------------------------------------------------
| EUR million | 1-3/ | 1-3/ | 1-12/ |
| | 2009 | 2008 | 2008 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net sales | 39.2 | 63.1 | 270.4 |
--------------------------------------------------------------------------------
| Other operating income | 0.4 | 0.2 | 0.4 |
--------------------------------------------------------------------------------
| Expenses | -46.0 | -59.6 | -265.8 |
--------------------------------------------------------------------------------
| Share of associates and joint ventures' | - | 0.0 | 0.0 |
| result | | | |
--------------------------------------------------------------------------------
| Depreciation, amortization and | -2.6 | -2.0 | -11.2 |
| impairment | | | |
--------------------------------------------------------------------------------
| Operating profit / loss | -9.0 | 1.6 | -6.1 |
--------------------------------------------------------------------------------
| Gains from assets held for sale | - | - | 0.1 |
--------------------------------------------------------------------------------
| Other financial items, net | 0.0 | -0.5 | -2.1 |
--------------------------------------------------------------------------------
| Result before income taxes | -9.0 | 1.1 | -8.1 |
--------------------------------------------------------------------------------
| Income taxes | 0.9 | -0.5 | -1.1 |
--------------------------------------------------------------------------------
| Profit / loss for the period | -8.1 | 0.6 | -9.2 |
--------------------------------------------------------------------------------
| Attributable to: | | | |
--------------------------------------------------------------------------------
| Non-controlling interests | 0.0 | 0.0 | 0.0 |
--------------------------------------------------------------------------------
| Owners of the parent | -8.1 | 0.6 | -9.1 |
--------------------------------------------------------------------------------
| Total | -8.1 | 0.6 | -9.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Earnings per share, EUR, basic and | -0.10 | 0.01 | -0.12 |
| diluted | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Operating profit / loss, as % of net | -22.9 | 2.6 | -2.3 |
| sales | | | |
--------------------------------------------------------------------------------
| Profit / loss for the period, as % of | -20.6 | 0.9 | -3.4 |
| net sales | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Non-recurring items included in | - | - | -12.3 |
| operating profit / loss | | | |
--------------------------------------------------------------------------------
| Operating profit / loss, non-recurring | -9.0 | 1.6 | 6.2 |
| items excluded | | | |
--------------------------------------------------------------------------------
| Operating profit / loss, non-recurring | -22.9 | 2.6 | 2.3 |
| items excluded, as % of net sales | | | |
--------------------------------------------------------------------------------
CONSOLIDATED STATEMENT OF COMPEREHENSIVE INCOME
--------------------------------------------------------------------------------
| EUR million | 1-3/ | 1-3/ | 1-12/ |
| | 2009 | 2008 | 2008 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Profit / loss for the period | -8.1 | 0.6 | -9.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Other comprehensive income | | | |
--------------------------------------------------------------------------------
| Total exchange differences on | 0.6 | -1.0 | 0.7 |
| translating foreign operations | | | |
--------------------------------------------------------------------------------
| Effective portion of fair value changes | - | 0.0 | - |
| of cash flow hedges | | | |
--------------------------------------------------------------------------------
| Fair value changes of cash flow hedges | - | - | 0.0 |
| reclassified in profit or loss | | | |
--------------------------------------------------------------------------------
| Fair value changes of available-for-sale | 0.0 | - | 0.0 |
| shares | | | |
--------------------------------------------------------------------------------
| Other reclassifications | 0.0 | - | 0.0 |
--------------------------------------------------------------------------------
| Income tax on other comprehensive income | 0.0 | 0.0 | 0.0 |
--------------------------------------------------------------------------------
| Other comprehensive income for the | 0.6 | -1.0 | 0.7 |
| reporting period, net of tax | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total comprehensive income for the | -7.4 | -0.4 | -8.5 |
| reporting period | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Attributable to | | | |
--------------------------------------------------------------------------------
| Owners of the parent | -7.4 | -0.4 | -8.5 |
--------------------------------------------------------------------------------
| Non-controlling interest | 0.0 | 0.0 | 0.0 |
--------------------------------------------------------------------------------
| Total comprehensive income for the | -7.4 | -0.4 | -8.5 |
| reporting period | | | |
--------------------------------------------------------------------------------
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
--------------------------------------------------------------------------------
| EUR million | 1-3/ | 1-3/ | 1-12/ |
| | 2009 | 2008 | 2008 |
--------------------------------------------------------------------------------
| Cash flows from operating activities | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flow before change in net working | -8.1 | 0.4 | 7.2 |
| capital | | | |
--------------------------------------------------------------------------------
| Change in net working capital | 4.4 | -0.6 | -30.4 |
--------------------------------------------------------------------------------
| Net cash flow from operating activities | -3.8 | -0.2 | -23.3 |
--------------------------------------------------------------------------------
| Cash flow from investing activities | | | |
--------------------------------------------------------------------------------
| Business combinations | - | - | 0.7 |
--------------------------------------------------------------------------------
| Other purchases of non-current assets | -2.3 | -3.1 | -14.5 |
--------------------------------------------------------------------------------
| Investment in shares in joint ventures | -1.8 | - | - |
--------------------------------------------------------------------------------
| Other | 0.1 | - | - |
--------------------------------------------------------------------------------
| Proceeds from sale of non-current assets | 1.0 | 0.0 | 0.4 |
--------------------------------------------------------------------------------
| Net cash used in investing activities | -2.9 | -3.1 | -13.4 |
--------------------------------------------------------------------------------
| Cash flow before financing | -6.7 | -3.2 | -36.7 |
--------------------------------------------------------------------------------
| Cash flow from financing activities | | | |
--------------------------------------------------------------------------------
| Changes in non-current liabilities | - | - | 17.5 |
| (increase + / decrease -) | | | |
--------------------------------------------------------------------------------
| Changes in non-current loan receivables | 0.0 | - | 0.3 |
| (increase - / decrease +) | | | |
--------------------------------------------------------------------------------
| Short-term financing, net (increase + / | 5.6 | 15.6 | 27.9 |
| decrease -) | | | |
--------------------------------------------------------------------------------
| Dividends paid | -3.6 | -7.2 | -7.8 |
--------------------------------------------------------------------------------
| Other financing | 1.2 | - | 0.0 |
--------------------------------------------------------------------------------
| Net cash used in financing activities | 3.2 | 8.4 | 37.8 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Effect of exchange rate changes | 0.8 | -0.2 | -1.0 |
--------------------------------------------------------------------------------
| Net change in cash and cash equivalents | -2.7 | 5.0 | 0.1 |
--------------------------------------------------------------------------------
| Cash and cash equivalents at the | 11.5 | 11.4 | 11.4 |
| beginning of period | | | |
--------------------------------------------------------------------------------
| Cash and cash equivalents at the end of | 8.8 | 16.4 | 11.5 |
| period | | | |
--------------------------------------------------------------------------------
| Net change in cash and cash equivalents | -2.7 | 5.0 | 0.1 |
--------------------------------------------------------------------------------
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
--------------------------------------------------------------------------------
| EUR million | Share | Share | Other | Reserve | Treasu | Fair |
| | capital| premiu | reser- | for | ry | value |
| | | m acc. | ves | invested | shares | reserve |
| | | | | unrestr. | | |
| | | | | equity | | |
--------------------------------------------------------------------------------
| Equity at 1 | 12.7 | 25.3 | - | 0.3 | -3.9 | - |
| January, 2008 | | | | | | |
--------------------------------------------------------------------------------
| Equity at 31 | 12.7 | 25.3 | - | 0.3 | -3.9 | - |
| March, 2008 | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | Share | Share | Other | Reserve | Treasury | Fair |
| | capital | premiu | reserves | for | shares | value |
| | | m acc. | | invested | | reser- |
| | | | | unrestr. | | ve |
| | | | | equity | | |
--------------------------------------------------------------------------------
| Equity at 1 | 12.7 | 25.3 | - | 0.2 | -3.5 | 0.0 |
| January, 2009 | | | | | | |
--------------------------------------------------------------------------------
| Total | - | - | 0.0 | - | - | 0.0 |
| comprehensive | | | | | | |
| income for the | | | | | | |
| period | | | | | | |
--------------------------------------------------------------------------------
| Other changes | - | - | - | 0.0 | 0.0 | - |
| in treasury | | | | | | |
| shares | | | | | | |
--------------------------------------------------------------------------------
| Equity at 31 | 12.7 | 25.3 | 0.0 | 0.2 | -3.5 | 0.0 |
| March, 2009 | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | Hedging | Retained| Exch. | Equity | Non-cont | Total |
| | reserve | | diff. | attrib. | rolling | equity |
| | | earnings| | to owners| interest | |
| | | | | of the | | |
| | | | | parent | | |
--------------------------------------------------------------------------------
| Equity at 1 | 0.0 | 106.8 | -1.2 | 139.9 | 0.0 | 139.9 |
| January, 2008 | | | | | | |
--------------------------------------------------------------------------------
| Total | 0.0 | 0.6 | -1.0 | -0.4 | 0.0 | -0.4 |
| comprehensive | | | | | | |
| income for | | | | | | |
| the period | | | | | | |
--------------------------------------------------------------------------------
| Share-based | - | 0.0 | - | 0.0 | - | 0.0 |
| incentive | | | | | | |
| plan | | | | | | |
--------------------------------------------------------------------------------
| Share-based | - | 0.0 | - | 0.0 | - | 0.0 |
| incentive | | | | | | |
| plan, tax | | | | | | |
| effect | | | | | | |
--------------------------------------------------------------------------------
| Dividends | - | -7.8 | - | -7.8 | - | -7.8 |
| paid | | | | | | |
--------------------------------------------------------------------------------
| Equity at 31 | 0.0 | 99.5 | -2.2 | 131.6 | 0.0 | 131.7 |
| March, 2008 | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR million | Hedging| Retained| Exch. | Equity | Non-cont | Total |
| | | | diff. | attrib. | rolling | equity |
| | reser- | earnings| | to | interest | |
| | ve | | | owners | | |
| | | | | of the | | |
| | | | | parent | | |
--------------------------------------------------------------------------------
| Equity at 1 | - | 89.6 | -0.5 | 123.7 | 0.0 | 123.8 |
| January, 2009 | | | | | | |
--------------------------------------------------------------------------------
| Total | - | -8.1 | 0.6 | -7.4 | 0.0 | -7.4 |
| comprehensive | | | | | | |
| income for the | | | | | | |
| period | | | | | | |
--------------------------------------------------------------------------------
| Other changes in | - | - | - | - | 0.4 | 0.4 |
| non-controlling | | | | | | |
| interest | | | | | | |
--------------------------------------------------------------------------------
| Other changes in | - | - | - | - | - | - |
| treasury shares | | | | | | |
--------------------------------------------------------------------------------
| Share-based | - | 0.0 | - | 0.0 | - | 0.0 |
| incentive plan | | | | | | |
--------------------------------------------------------------------------------
| Share-based | - | 0.0 | - | 0.0 | - | 0.0 |
| incentive plan, | | | | | | |
| tax effect | | | | | | |
--------------------------------------------------------------------------------
| Dividends paid | - | -3.9 | - | -3.9 | - | -3.9 |
--------------------------------------------------------------------------------
| Equity at 31 | - | 77.6 | 0.1 | 112.4 | 0.4 | 112.8 |
| March, 2009 | | | | | | |
--------------------------------------------------------------------------------
KEY RATIOS
--------------------------------------------------------------------------------
| | 31.3.2009 | 31.3.2008 | 31.12.2008 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EBITDA, as % of net sales (1 | -16.2 | 5.7 | 1.9 |
--------------------------------------------------------------------------------
| Operating profit / loss (EBIT), as % | -22.9 | 2.6 | -2.3 |
| of net sales | | | |
--------------------------------------------------------------------------------
| Net result, as % of net sales | -20.6 | 0.9 | -3.4 |
--------------------------------------------------------------------------------
| Gross capital expenditure, EUR | 4.1 | 3.3 | 18.4 |
| million | | | |
--------------------------------------------------------------------------------
| Gross capital expenditure, as % of | 10.4 | 5.2 | 6.8 |
| net sales | | | |
--------------------------------------------------------------------------------
| Equity ratio, % | 44.3 | 52.2 | 45.8 |
--------------------------------------------------------------------------------
| Gearing, % | 66.5 | 28.1 | 56.1 |
--------------------------------------------------------------------------------
| Net gearing, % | 58.7 | 15.7 | 46.8 |
--------------------------------------------------------------------------------
| Net interest-bearing debt, EUR | 66.2 | 20.6 | 57.9 |
| million | | | |
--------------------------------------------------------------------------------
| Capital employed, end of period, EUR | 187.8 | 168.7 | 193.2 |
| million | | | |
--------------------------------------------------------------------------------
| Return on equity, %, annualized | -27.3 | 1.7 | -7.0 |
--------------------------------------------------------------------------------
| Return on capital employed, %, | -17.1 | 4.1 | -2.3 |
| annualized | | | |
--------------------------------------------------------------------------------
| Number of personnel, average | 1,490 | 1,462 | 1,519 |
--------------------------------------------------------------------------------
| Number of personnel, end of period | 1,480 | 1,489 | 1,541 |
--------------------------------------------------------------------------------
(1 EBITDA = Operating profit / loss + depreciation, amortization and impairment.
--------------------------------------------------------------------------------
| PER SHARE DATA | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 31.3. | 31.3. | 31.12. |
| | 2009 | 2008 | 2008 |
--------------------------------------------------------------------------------
| Number of shares, end of period, | 78,536 | 78,437 | 78,540 |
| treasury shares excluded (1,000) | | | |
--------------------------------------------------------------------------------
| Number of shares, average, treasury | 78,536 | 78,437 | 78,507 |
| shares excluded (1,000) | | | |
--------------------------------------------------------------------------------
| EPS, EUR (* | -0.10 | 0.01 | -0.12 |
--------------------------------------------------------------------------------
| Equity attributable to owners of the | 1.43 | 1.68 | 1.58 |
| parent per share, EUR | | | |
--------------------------------------------------------------------------------
| Price per earnings per share (P/E) | -9.2 | 430.5 | -7.8 |
| ratio | | | |
--------------------------------------------------------------------------------
| Price per equity attributable to | 0.66 | 1.91 | 0.58 |
| owners of the parent per share | | | |
--------------------------------------------------------------------------------
| Market capitalization, EUR million | 74.6 | 251.0 | 71.5 |
--------------------------------------------------------------------------------
| Share turnover, % (number of shares | 2.8 | 1.0 | 5.1 |
| traded, % of the average number of | | | |
| shares) | | | |
--------------------------------------------------------------------------------
| Number of shares traded, (1,000) | 2,193 | 781 | 3,965 |
--------------------------------------------------------------------------------
| Closing price of the share, EUR | 0.95 | 3.20 | 0.91 |
--------------------------------------------------------------------------------
| Highest quoted price, EUR | 1.15 | 3.30 | 3.33 |
--------------------------------------------------------------------------------
| Lowest quoted price, EUR | 0.92 | 2.70 | 0.87 |
--------------------------------------------------------------------------------
| Volume-weighted average quoted price, | 1.15 | 3.06 | 2.07 |
| EUR | | | |
--------------------------------------------------------------------------------
(* Glaston Corporation has not issued options or warrants or similar instruments
which would dilute the earnings per share.
DEFINITIONS OF KEY RATIOS
Financial ratios
EBITDA = Profit / loss before depreciation, amortization and impairment, share
of joint ventures' and associates' results included
Operating profit (EBIT) = Profit / loss after depreciation, amortization and
impairment, share of joint ventures' and associates' results included
Cash and cash equivalents = Cash + other financial assets
Net interest-bearing debt = Interest-bearing liabilities - cash and cash
equivalents
Financial expenses = Interest expenses of financial liabilities + fees of
financing arrangements + foreign currency differences of financial liabilities
Equity ratio, % = Equity (Equity attributable to owners of the parent +
non-controlling interest) x 100 / Total assets - advance payments received
Gearing, % = Interest-bearing liabilities x 100 / Equity (Equity attributable to
owners of the parent + non-controlling interest)
Net gearing, % = Net interest-bearing debt x 100 / Equity (Equity attributable
to owners of the parent + non-controlling interest)
Return on investments, % (ROCE) = Profit / loss before taxes + financial
expenses x 100 / Equity + interest-bearing liabilities (average of 1 January
and end of the reporting period)
Return on equity, % (ROE)= Profit / loss for the reporting period x 100 /
Equity (Equity attributable to owners of the parent + non-controlling interest)
(average of 1 January and end of the reporting period)
Per share data
Earnings per share (EPS) = Net result attributable to owners of the parent /
Adjusted average number of shares
Equity attributable to owners of the parent per share = Equity attributable to
owners of the parent at end of the period / Adjusted number of shares at end of
the period
Average trading price = Shares traded (EUR) / Shares traded (volume)
Price per earnings per share (P/E) = Share price at end of the period /
Earnings per share (EPS)
Price per equity per share = Share price at period end / Equity attributable to
owners of the parent per share
Share turnover = The proportion of number of shares traded during the period to
average number of shares
Market capitalization = Number of shares at end of the period x share price at
end of the period
Number of shares at period end = Number of issued shares - treasury shares
ACCOUNTING POLICIES
These condensed consolidated interim financial statements have been
prepared in accordance with the IFRS recognition and measurement principles but
not complying with all the requirements of IAS 34 Interim Financial Reporting.
The consolidated interim financial statements do not include all of the
information required for annual financial statements.
The accounting principles applied in these condensed interim
consolidated financial statements are the same as in the previous financial
statements, with the exception of the following
new or revised or amended standards and interpretations, which have
been applied from 1 January, 2009:
- IAS 23 (revised) Borrowing Costs
- IFRS 8 Operating Segments
- IFRIC 13 Customer Loyalty Programs
- Amendments to IFRS 2 Share-based Payments: Vesting Conditions and
Cancellations
- Amendments to IAS 32 Financial Instruments: Presentation and IAS 1
Presentation of Financial Statements - Puttable Financial Instruments and
Obligations Arising on Liquidation
- IFRIC 15 Agreements for the Construction of Real Estate
- Amendment to IAS 39 Financial Instruments: Recognition and Measurement -
Eligible Hedged Items
- Amendments to IFRS 1 First-time Adoption of International Financial Reporting
Standards and IAS 27 Consolidated and Separate Financial Statements - Cost of
an Investment in a Subsidiary, Jointly Controlled Entity or Associate.
- Amendments to IFRS 7 Financial Instruments: Disclosures - Improving
Disclosures about Financial Instruments
- Amendments to IFRIC 9 and IAS 39: Embedded Derivatives
In addition, Glaston applies the annual Improvements to IFRSs issued in May
2008.
Applying revised IAS 23 Borrowing Costs changed Glaston's accounting principles
from 1 January 2009. From that date on the borrowing costs that are directly
attributable to the acquisition, construction or production of a qualifying
asset are capitalized to the acquisition cost of the asset. The capitalization
will apply mainly to property, plant and equipment and intangible assets.
Applying IFRS 8 Operating Segments did not have any material effect on the
financial information of Glaston.
Other new or amended standards or interpretations are not material for Glaston
Group.
DIVESTMENTS
Glaston's subsidiary Tamglass Glass Processing Ltd. sold in March its
insulated and architectural glass processing operations to INTERPANE Glass Oy.
INTERPANE Glass Oy began its operations on April, 2009. The divested operations
had net sales of approximately EUR 14 million in 2008 and 93 employees at the
end of March. The personnel were transferred to INTERPANE Glass Oy.
The transaction was an asset deal, consisting of, among others, tangible assets
and inventory. The deal was financed mainly through vendor financing given by
Glaston. Glaston also invested EUR 1.8 million in the equity of INTERPANE Glass
Oy. In addition, Glaston is committed to invest additional EUR 1.0 million in
INTERPANE's equity.
INTERPANE Glass Oy is a company owned jointly by Georg F. Hesselbach through his
company A A A Glass & Design Finland Oy, and a subsidiary of Glaston
Corporation. The shareholders of INTERPANE Glass Oy have entered into a
shareholders' agreement which incorporates put and call options enabling the
shareholders to rearrange their ownership shares in the company in the future.
The transaction has no material effect on Glaston's result.
INTERPANE Glass Oy is a joint venture of Glaston, and it is consolidated in
Glaston's consolidated financial statements using the equity method.
Glaston continues its production of solar reflectors in Akaa, Finland, employing
approximately 30 persons.
CHANGES IN JOINT VENTURES
The Chinese company Sanhe AAA Tools Co. was consolidated in 2008 as a joint
venture using the equity method and not as a subsidiary despite of the 70 per
cent ownership of Glaston, because Glaston was not considered to have control of
the company. From 1 January, 2009, Sanhe AAA Tools Co. has been consolidated as
a subsidiary as Glaston has gained control of the company.
INTERPANE Glass Oy became a joint venture of Glaston on 31 March, 2009.
SEGMENT INFORMATION
The Pre-processing segment includes glass pre-processing machines, maintenance
and service operations, as well as tool manufacturing. The Heat Treatment
segment includes tempering, bending and laminating machines, maintenance and
service operations, as well as the glass processing operations of Tamglass Glass
Processing. The Software Solutions segment's product offering covers enterprise
resource planning systems for the glass industry, software for windows and door
glass manufacturers, and software for glass processor's integrated line
solutions.
Glaston announced in a stock exchange release on 22 April, 2009 that it changes
the reporting segments. The second quarter interim report of Glaston will be
prepared in accordance with the new segments.
EUR million
--------------------------------------------------------------------------------
| Net sales | 1-3/ | 1-3/ | 1-12/ |
| | 2009 | 2008 | 2008 |
--------------------------------------------------------------------------------
| Pre-processing | 11.1 | 22.9 | 89.7 |
--------------------------------------------------------------------------------
| Heat Treatment | 22.2 | 32.9 | 152.9 |
--------------------------------------------------------------------------------
| Software Solutions | 6.0 | 7.3 | 28.2 |
--------------------------------------------------------------------------------
| Parent company and eliminations | 0.0 | 0.0 | -0.3 |
--------------------------------------------------------------------------------
| Total | 39.2 | 63.1 | 270.4 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Operating profit / loss, excluding | 1-3/ | 1-3/ | 1-12/ |
| non-recurring items | 2009 | 2008 | 2008 |
--------------------------------------------------------------------------------
| Pre-processing | -4.4 | 0.6 | -3.0 |
--------------------------------------------------------------------------------
| Heat Treatment | -2.6 | 1.9 | 13.0 |
--------------------------------------------------------------------------------
| Software Solutions | -0.4 | 1.0 | 3.7 |
--------------------------------------------------------------------------------
| Parent company and eliminations | -1.6 | -1.8 | -7.5 |
--------------------------------------------------------------------------------
| Total | -9.0 | 1.6 | 6.2 |
--------------------------------------------------------------------------------
| Non-recurring items | - | - | -12.3 |
--------------------------------------------------------------------------------
| Operating profit / loss | -9.0 | 1.6 | -6.1 |
--------------------------------------------------------------------------------
| Net financial items | 0.0 | -0.5 | -2.0 |
--------------------------------------------------------------------------------
| Income taxes | 0.9 | -0.5 | -1.1 |
--------------------------------------------------------------------------------
| Net result for the period | -8.1 | 0.6 | -9.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Operating profit / loss, excluding | 1-3/ | 1-3/ | 1-12/ |
| non-recurring items, as % of net sales | 2009 | 2008 | 2008 |
--------------------------------------------------------------------------------
| Pre-processing | -39.4% | -2.5% | -3.3% |
--------------------------------------------------------------------------------
| Heat Treatment | -11.7% | 5.7% | 8.5% |
--------------------------------------------------------------------------------
| Software Solutions | -6.0% | 13.2% | 13.3% |
--------------------------------------------------------------------------------
| Total | -22.9% | 2.6% | 2.3% |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Depreciation, amortization and | 1-3/ | 1-3/ | 1-12/ |
| impairment | 2009 | 2008 | 2008 |
--------------------------------------------------------------------------------
| Pre-processing | 0.5 | 0.4 | 2.1 |
--------------------------------------------------------------------------------
| Heat Treatment | 1.1 | 0.9 | 6.5 |
--------------------------------------------------------------------------------
| Software Solutions | 0.8 | 0.4 | 1.7 |
--------------------------------------------------------------------------------
| Parent company and eliminations | 0.3 | 0.2 | 0.9 |
--------------------------------------------------------------------------------
| Total | 2.6 | 2.0 | 11.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net working capital | 31.3.2009 | 31.3.2008 | 31.12.2008 |
--------------------------------------------------------------------------------
| Pre-processing | 34.1 | 26.0 | 31.8 |
--------------------------------------------------------------------------------
| Heat Treatment | 41.5 | 37.6 | 54.9 |
--------------------------------------------------------------------------------
| Software Solutions | 7.1 | 5.3 | 5.8 |
--------------------------------------------------------------------------------
| Parent company and eliminations | -0.5 | -0.8 | -0.4 |
--------------------------------------------------------------------------------
| Total | 82.2 | 68.0 | 92.1 |
--------------------------------------------------------------------------------
In segment reporting net working capital consists of inventory, external trade
receivables and trade payables and advances received.
--------------------------------------------------------------------------------
| Orders received | 1-3/ | 1-3/ | 1-12/ |
| | 2009 | 2008 | 2008 |
--------------------------------------------------------------------------------
| Pre-processing | 8.0 | 19.4 | 68.6 |
--------------------------------------------------------------------------------
| Heat Treatment | 14.1 | 44.0 | 135.5 |
--------------------------------------------------------------------------------
| Software Solutions | 2.4 | 4.8 | 13.9 |
--------------------------------------------------------------------------------
| Total | 24.5 | 68.3 | 218.0 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Order book | 31.3.2009 | 31.3.2008 | 31.12.2008 |
--------------------------------------------------------------------------------
| Pre-processing | 13.5 | 21.0 | 13.0 |
--------------------------------------------------------------------------------
| Heat Treatment | 28.7 | 66.4 | 46.0 |
--------------------------------------------------------------------------------
| Software Solutions | 3.7 | 9.5 | 3.5 |
--------------------------------------------------------------------------------
| Total | 45.9 | 96.9 | 62.5 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net sales by market area | 1-3/ | 1-3/ | 1-12/ |
| | 2009 | 2008 | 2008 |
--------------------------------------------------------------------------------
| EMEA | 26.2 | 43.2 | 175.6 |
--------------------------------------------------------------------------------
| America | 9.3 | 11.9 | 56.0 |
--------------------------------------------------------------------------------
| Asia | 3.8 | 8.0 | 38.8 |
--------------------------------------------------------------------------------
| Total | 39.2 | 63.1 | 270.4 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net sales by market area, % | 1-3/ | 1-3/ | 1-12/ |
| | 2009 | 2008 | 2008 |
--------------------------------------------------------------------------------
| EMEA | 66.8% | 68.5% | 55.8% |
--------------------------------------------------------------------------------
| America | 23.6% | 18.9% | 28.0% |
--------------------------------------------------------------------------------
| Asia | 9.6% | 12.7% | 16.2% |
--------------------------------------------------------------------------------
| Total | 100.0% | 100.0% | 100.0% |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 1-3/ | 1-3/ | change, % | 1-12/ |
| 2009 | 2008 | | 2008 |
--------------------------------------------------------------------------------
| Geographical distribution | |
| of orders received | |
--------------------------------------------------------------------------------
| EMEA | 13.3 | 42.4 | -68.6% | 144.8 |
--------------------------------------------------------------------------------
| America | 7.3 | 11.3 | -35.4% | 45.9 |
--------------------------------------------------------------------------------
| Asia | 3.8 | 14.5 | -73.7% | 27.3 |
--------------------------------------------------------------------------------
| Total | 24.5 | 68.3 | -64.1% | 218.0 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Personnel at the end of the period | 31.3.2009 | 31.3.2008 | 31.12.2008 |
--------------------------------------------------------------------------------
| Pre-processing | 584 | 625 | 614 |
--------------------------------------------------------------------------------
| Heat Treatment | 615 | 600 | 640 |
--------------------------------------------------------------------------------
| Software Solutions | 253 | 239 | 262 |
--------------------------------------------------------------------------------
| Parent company | 27 | 25 | 26 |
--------------------------------------------------------------------------------
| Total | 1,480 | 1,489 | 1,541 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Personnel, average | 1-3/ | 1-3/ | 1-12/ |
| | 2009 | 2008 | 2008 |
--------------------------------------------------------------------------------
| Pre-processing | 600 | 602 | 591 |
--------------------------------------------------------------------------------
| Heat Treatment | 608 | 590 | 647 |
--------------------------------------------------------------------------------
| Software Solutions | 256 | 246 | 255 |
--------------------------------------------------------------------------------
| Parent company | 27 | 24 | 26 |
--------------------------------------------------------------------------------
| Total | 1,490 | 1,462 | 1,519 |
--------------------------------------------------------------------------------
NET SALES, OPERATING RESULT AND ORDER BOOK BY QUARTER
--------------------------------------------------------------------------------
| Net sales | 1-3/ | 10-12/ | 7-9/ | 4-6/ | 1-3/ |
| | 2009 | 2008 | 2008 | 2008 | 2008 |
--------------------------------------------------------------------------------
| Pre-processing | 11.1 | 23.7 | 20.0 | 23.2 | 22.9 |
--------------------------------------------------------------------------------
| Heat Treatment | 22.2 | 38.8 | 37.2 | 44.0 | 32.9 |
--------------------------------------------------------------------------------
| Software Solutions | 6.0 | 6.6 | 7.8 | 6.4 | 7.3 |
--------------------------------------------------------------------------------
| Parent company and | 0.0 | -0.2 | 0.8 | -1.0 | 0.0 |
| eliminations | | | | | |
--------------------------------------------------------------------------------
| Total | 39.2 | 68.9 | 65.8 | 72.6 | 63.1 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Operating profit / loss | 1-3/ | 10-12/ | 7-9/ | 4-6/ | 1-3/ |
| excluding non-recurring | 2009 | 2008 | 2008 | 2008 | 2008 |
| items | | | | | |
--------------------------------------------------------------------------------
| Pre-processing | -4.4 | -1.1 | -1.6 | -0.7 | 0.6 |
--------------------------------------------------------------------------------
| Operating profit / | -39.4% | -4.8% | -8.4% | -3.1% | 2.5% |
| loss, % | | | | | |
--------------------------------------------------------------------------------
| Heat Treatment | -2.6 | 2.5 | 3.3 | 5.3 | 1.9 |
--------------------------------------------------------------------------------
| Operating profit / | -11.7% | 6.4% | 8.9% | 12.0% | 5.7% |
| loss, % | | | | | |
--------------------------------------------------------------------------------
| Software Solutions | -0.4 | 0.1 | 1.4 | 1.2 | 1.0 |
--------------------------------------------------------------------------------
| Operating profit / | -6.0% | 1.8% | 18.1% | 19.3% | 13.2% |
| loss, % | | | | | |
--------------------------------------------------------------------------------
| Parent company and | -1.6 | -1.8 | -2.0 | -2.0 | -1.8 |
| eliminations | | | | | |
--------------------------------------------------------------------------------
| Total | -9.0 | -0.3 | 1.1 | 3.8 | 1.6 |
--------------------------------------------------------------------------------
| Operating profit / | -22.9% | -0.4% | 1.6% | 5.2% | 2.6% |
| loss, % | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Operating profit / loss | 1-3/ | 10-12/ | 7-9/ | 4-6/ | 1-3/ |
| | 2009 | 2008 | 2008 | 2008 | 2008 |
--------------------------------------------------------------------------------
| Pre-processing | -4.4 | -6.6 | -1.6 | -0.7 | 0.6 |
--------------------------------------------------------------------------------
| Operating profit / | -39.4% | -27.7% | -8.4% | -3.1% | 2.5% |
| loss, % | | | | | |
--------------------------------------------------------------------------------
| Heat Treatment | -2.6 | -3.8 | 3.3 | 5.3 | 1.9 |
--------------------------------------------------------------------------------
| Operating profit / | -11.7% | -9.8% | 8.9% | 12.0% | 5.7% |
| loss, % | | | | | |
--------------------------------------------------------------------------------
| Software Solutions | -0.4 | -0.4 | 1.4 | 1.2 | 1.0 |
--------------------------------------------------------------------------------
| Operating profit / | -6.0% | -6.5% | 18.1% | 19.3% | 13.2% |
| loss, % | | | | | |
--------------------------------------------------------------------------------
| Parent company and | -1.6 | -1.8 | -2.0 | -2.0 | -1.8 |
| eliminations | | | | | |
--------------------------------------------------------------------------------
| Total | -9.0 | -12.6 | 1.0 | 3.8 | 1.6 |
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| Operating profit / | -22.9% | -18.3% | 1.6% | 5.2% | 2.6% |
| loss, % | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Order book | 31.3.2009 | 31.12.200 | 30.9.2008 | 30.6.2008 | 31.3.2008 |
| | | 8 | | | |
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| Pre-processing | 13.5 | 13.0 | 19.1 | 21.9 | 21.0 |
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| Heat Treatment | 28.7 | 46.0 | 60.8 | 72.4 | 66.4 |
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| Software | 3.7 | 3.5 | 4.5 | 6.0 | 9.5 |
| Solutions | | | | | |
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| Total | 45.9 | 62.5 | 84.4 | 100.3 | 96.9 |
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CONTINGENT LIABILITIES
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| EUR million | 31.3.2009 | 31.3.2008 | 31.12.2008 |
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| Mortgages | | | |
--------------------------------------------------------------------------------
| On own behalf | 0.2 | 0.2 | 0.2 |
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| Guarantees | | | |
--------------------------------------------------------------------------------
| On own behalf | 0.4 | 1.4 | 0.8 |
--------------------------------------------------------------------------------
| On behalf of others | 0.1 | 0.3 | 0.1 |
--------------------------------------------------------------------------------
| Lease obligations | 18.2 | 17.5 | 19.3 |
--------------------------------------------------------------------------------
| Repurchase obligations | 0.4 | 2.7 | 0.5 |
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| Other obligation on own behalf | 0.2 | 0.3 | 0.3 |
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| Capital commitments in relation to | 1.0 | - | - |
| interests in joint ventures | | | |
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A customer of the US subsidiary Glaston USA, Inc. had made a claim of
approximately USD 22 million due to a sale of a machine in 2004. The arbitration
proceeding initiated by the customer against the US subsidiary Glaston USA, Inc.
has been concluded in April. Majority of the customer's claim were denied. The
matter has no effect on Glaston's 2009 result, but the compensation to be paid
by Glaston will affect Glaston's cash flow.
The Group recognized a tax refund of approximately EUR 2 million in 2006 after
having received an affirmative decision according to which the expenses arising
from the management incentive scheme of the Group are deductible in taxation.
The tax authorities of the Tax Office for Major Corporations appealed against
the decision to the Administrative Court of Helsinki. Administrative Court of
Helsinki decided the case on Glaston's favour in January 2009. The decision was
subject to appeal until late March 2009.
Glaston Group has international operations and can be a defendant or plaintiff
in a number of legal proceedings incidental to those operations. The Group does
not expect the outcome of any unmentioned legal proceedings currently pending,
either individually or in the aggregate, to have material adverse effect upon
the Group's consolidated financial position or results of operations.
DERIVATIVE INSTRUMENTS
--------------------------------------------------------------------------------
| EUR million | 31.3.2009 | | 31.3.2008 | | 31.12.2008 | |
--------------------------------------------------------------------------------
| | Nominal | Fair | Nominal | Fair | Nominal | Fair |
| | value | valu | value | value | value | value |
| | | e | | | | |
--------------------------------------------------------------------------------
| Currency | | | | | | |
| derivatives | | | | | | |
--------------------------------------------------------------------------------
| Currency | 5.8 | 0.0 | 13.6 | 0.6 | 6.2 | -0.1 |
| forwards | | | | | | |
--------------------------------------------------------------------------------
Derivative instruments are used only for hedging purposes. Nominal
values of derivative instruments do not necessarily correspond with
the actual cash flows between the counterparties and do not therefore give a
fair view of the risk position of the Group. The fair values are based on market
valuation on the date of reporting.
RELATED PARTY TRANSACTIONS
Glaston Group's related parties include the parent, subsidiaries, associates and
joint ventures. Related parties also include the members of the Board of
Directors and the Group's Executive Management Group, the CEO and their family
members.
Glaston follows the same commercial terms in transactions with associates and
joint ventures and other related parties as with third parties.
During the review period Glaston's related party transactions included sales to
joint ventures. In addition, the Group has leased premises from companies owned
by individuals belonging to the management. The lease payments were in January -
March EUR 0.2 (0.2) million.
During the review period there were no related party transactions whose terms
would differ from the terms in transactions with third parties.
Transactions with joint ventures and associates
In January - March 2009 or 2008 Glaston had no material transactions with the
joint venture. Glaston did not have transactions with the associate.
--------------------------------------------------------------------------------
| EUR million | 1-3/ | 1-3/ | 1-12/ |
| | 2009 | 2008 | 2008 |
--------------------------------------------------------------------------------
| Sales to joint ventures | - | - | 0.0 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 1-3/ | 1-3/ | 1-12/ |
| | 2009 | 2008 | 2008 |
--------------------------------------------------------------------------------
| Receivables from joint ventures | | | |
--------------------------------------------------------------------------------
| Current receivables | - | - | 0.0 |
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| Non-current loan receivables | 1.7 | - | - |
--------------------------------------------------------------------------------
| Loan receivables | 5.4 | - | - |
--------------------------------------------------------------------------------