Glaston’s Financial Statement Bulletin January 1 – December 31, 2023: Steady improvement in profitability throughout 2023
GLASTON CORPORATION FINANCIAL STATEMENT BULLETIN 15 FEBRUARY 2024 AT 8.30
This release is a summary of Glaston Corporation's financial statements bulletin for 2023. The complete report is attached to this release as a pdf-file. The stock exchange release is also available on the company's website at the address www.glaston.net.
As of October 1, 2023, Glaston has two reporting segments: Architecture and Mobility, Display & Solar. Services business is included in the reporting segments. On November 24, 2023, the company published comparative information according to the new structure.
OCTOBER–DECEMBER 2023 IN BRIEF
- Orders received totaled EUR 57.6 (51.7) million
- Net sales totaled EUR 59.7 (59.8) million
- Comparable EBITA was EUR 4.6 (4.2) million, i.e. 7.6 (7.0)% of net sales
- The operating result (EBIT) was EUR 2.7 (2.5) million
- Cash flow from operating activities was EUR 13.1 (8.7) million
- Comparable earnings per share were EUR 0.039 (0.027)
JANUARY–DECEMBER 2023 IN BRIEF
- Orders received totaled EUR 220.3 (253.0) million
- Net sales totaled EUR 219.7 (213.5) million
- Comparable EBITA was EUR 14.9 (13.6) million, i.e. 6.8 (6.4)% of net sales
- The operating result (EBIT) was EUR 8.1 (7.6) million
- Comparable earnings per share were EUR 0.104 (0.074)
- The Board of Directors proposes a capital repayment of EUR 0.05 per share
GLASTON’S OUTLOOK FOR 2024
Amid early signs of increasing market activity, Glaston expects the architectural glass processing equipment markets to start recovering slowly at some point in 2024. In Europe, demand is expected to remain at the current level with the recovery taking place towards the end of the year. In the Americas, the current demand level is expected to continue. In China, demand in the Architectural market is expected to remain at a reasonable level. In the mobility glass processing equipment market, the cautiously positive development is expected to continue driven by China. With global economic uncertainty and geopolitical tensions continuing, higher-than-normal uncertainty exists in relation to customers’ decision-making.
Glaston starts the year with a lower order backlog than the previous year. However, given the expected improving market activity during the year, Glaston Corporation estimates that its net sales and comparable EBITA will stay at the same level or increase slightly in 2024 from the levels reported for 2023. In 2023, Group net sales totaled EUR 219.7 million and comparable EBITA was EUR 14.9 million.
INTERIM CEO ANTTI KAUNONEN:
“Despite market uncertainty and increasing geopolitical tensions, 2023 was a year of steady progress for Glaston.
During the year the glass processing equipment markets developed unevenly. We saw good development in the Mobility market, particularly in China, whereas the Architectural market slowed down, reflecting the lower construction activity in several regions. The fourth-quarter order intake was up 11% and totaled EUR 57.6 million due to the good order intake development in the Mobility, Display & Solar segment. Also, the upgrade order intake recovered in the final quarter. The full-year order intake was down 13% reflecting the slowdown in the Architectural market.
Fourth-quarter net sales were at the same level as in the corresponding period of the previous year and totaled EUR 59.7 million while net sales for the full year increased by 3%. Fourth-quarter and full-year profitability improved. Comparable fourth-quarter EBITA was EUR 4.6 million (7.6% margin) driven by good year-on-year development in the Architecture segment. Profitability development in the Mobility, Display & Solar segment was unsatisfactory.
The strategy execution continued in line with plans. The new company structure came into effect on October 1st, and during the quarter the organizational change was completed and implemented. The purpose of the reorganization is to accelerate the strategy execution and at the same time enhance the customer experience with lifecycle solutions and improve operational excellence and efficiency. Our strategic initiative to set up production of Automotive pre-processing equipment in Tianjin, China, was completed in the final quarter as the transfer of basic capabilities and know-how was completed. This initiative burdened the segment’s profitability in 2023 but has already proved its worth as we can see a clear upturn in pre-processing equipment orders from China.
We continued our investments in product development with automation and digitalization at the forefront of our development work. Our customers increasingly require more automation, starting with easier operation and reaching up to fully automated lines. Automation provides significant benefits to production efficiency and quality and it also optimizes energy consumption by making the processes more efficient.
We continued our progress in sustainability. In the latter part of the year, we set new, science-based emission reduction targets and submitted them to the Science Based Targets initiative for validation. Glaston is committed to reducing absolute scope 1 and 2 GHG emissions by 50% by 2032, compared to the 2022 base year. This target is in line with limiting global warming to 1.5°C. Glaston is also committed to reducing scope 3 GHG emission intensity by 58% per square meter of sold glass processing capacity within the same target period.
Safety continued to be a key focus area throughout the year. Our group-wide safety target is zero accidents. In 2023, our lost-time accidents increased by four to a total of ten, and our accident frequency rate LTIFR was 6.3, which shows that we need to further increase focus on safety. Our employee engagement rate was at the same level as in the previous year and was 70. Our target is an employee engagement rate of over 75 out of 100.
We started the new year 2024 by revisiting our strategy. Due to the significant changes in the global economy and Glaston’s addressable markets starting to soften in 2023, we have adjusted the timeframe for achieving our strategic targets from 2025 to reach them in the medium term (3−5 years). We have also updated our net sales and ROCE targets. We expect annual average net sales to exceed the addressable equipment market growth and the comparable return on capital employed (ROCE) to be above 16%. The target for comparable operating margin (EBITA) of 10% remains unchanged.
The past year was another eventful year for Glaston and special thanks go to our employees and customers. I also want to thank our shareholders for their continued trust in the company.
Despite the prevailing market uncertainty, there are some early signs that the Architectural market is slowly starting to recover from the low levels in 2023, and driven by China, we expect the positive development in the Mobility market to continue. On this basis, we expect net sales and comparable EBITA to stay at the same level or increase slightly in 2024 compared to 2023.”
GLASTON GROUP’S KEY FIGURES
| EUR million | 10–12/ 2023 |
10–12/ 2022 |
Change% | 1–12/ 2023 |
1–12/ 2022 |
Change% |
| Orders received | 57.6 | 51.7 | 11.4% | 220.3 | 253.0 | -12.9% |
| of which service operations | 20.2 | 18.5 | 9.4% | 74.4 | 72.5 | 2.6% |
| of which service operations, % | 35.1% | 35.7% | 33.8% | 28.6% | ||
| Order book at end of period | 106.5 | 138.3 | -23.0% | 106.53) | 138.3 | -23.0% |
| Net sales | 59.7 | 59.8 | -0.2% | 219.7 | 213.5 | 2.9% |
| of which service operations | 20.0 | 21.1 | -5.3% | 76.0 | 76.4 | -0.5% |
| of which service operations, % | 33.5% | 35.3% | 34.6% | 35.8% | ||
| EBITDA | 4.7 | 4.3 | 8.4% | 15.7 | 15.3 | 2.7% |
| Items affecting comparability1) | 0.9 | 0.9 | 3.8% | 3.3 | 2.3 | 43.8% |
| Comparable EBITDA | 5.6 | 5.2 | 7.6% | 19.0 | 17.6 | 8.0% |
| Comparable EBITDA, % | 9.3% | 8.7% | 8.7% | 8.2 % | ||
| Comparable EBITA | 4.6 | 4.2 | 9.0% | 14.9 | 13.6 | 9.1% |
| Comparable EBITA, % | 7.6% | 7.0% | 6.8% | 6.4% | ||
| Operating result (EBIT) | 2.7 | 2.5 | 7.5% | 8.1 | 7.6 | 6.6% |
| Profit/loss for the period | 2.3 | 1.3 | 70.7% | 5.0 | 3.1 | 63.1% |
| Comparable earnings per share, EUR2) | 0.039 | 0.027 | 43.5% | 0.104 | 0.074 | 40.8% |
| Cash flow from operating activities | 13.1 | 8.7 | 50.2% | 13.8 | 10.2 | 35.4% |
| Return on capital employed (ROCE), %, (annualized) | 8.1% | 6.9% | ||||
| Comparable return on capital employed (ROCE), %, (annualized) | 12.7% | 10.5% | ||||
| Equity ratio, % | 45.2% | 44.0% | ||||
| Net gearing, % | 15.8% | 19.5% | ||||
| Number of employees at end of period | 802 | 783 | 2.4% |
- + cost, - income
- change in comparable EPS formula, net of tax added
- The order backlog for Insulating Glass Technologies was adjusted in 2023 for the partial cancellation of orders with one customer, totaling EUR 19.4 million
ANALYST AND PRESS MEETING
Glaston’s Interim CEO Antti Kaunonen and CFO Päivi Lindqvist will present the financial result to analysts, investors and media representatives on the same day at 9.30 (Finnish time) in English. The live webcast can be joined through this link: https://glaston.videosync.fi/q4-2023/register. A recording of the meeting including the presentation will be available on www.glaston.net after the meeting.
For further information, please contact:
Interim CEO Antti Kaunonen, tel. +358 10 500 500
Chief Financial Officer Päivi Lindqvist, tel. +358 10 500 500
Glaston Corporation
Pia Posio
VP, Communications, Marketing and IR
Tel. +358 10 500 500
Glaston in brief
Glaston is the glass processing industry’s innovative technology leader supplying equipment, services and solutions to the architectural, mobility, display and solar industries. The company also supports the development of new technologies integrating intelligence to glass.
Glaston is committed to providing its clients with both the best know-how and the latest technologies in glass processing, with the purpose of building a better tomorrow through safer, smarter, and more energy efficient glass solutions. Glaston operates globally with manufacturing, services and sales offices in nine countries and its shares (GLA1V) are listed on Nasdaq Helsinki Ltd.
Distribution: Nasdaq Helsinki Ltd, key media, www.glaston.net.