Glaston’s interim report January─March 2022: Strong performance continued in order intake and profitability
GLASTON CORPORATION INTERIM REPORT 27 APRIL 2022 AT 8.30
This release is a summary of Glaston Corporation's Interim Report for January-March 2022. The complete report is attached to this release as a pdf-file. The release is also available on the company's website at the address www.glaston.net.
JANUARY─MARCH 2022 IN BRIEF
- Orders received totaled EUR 59.0 (47.2) million.
- Net sales totaled EUR 52.3 (40.4) million.
- Comparable EBITA was EUR 3.5 (2.1) million, i.e. 6.6 (5.1)% of net sales.
- The operating result (EBIT) was EUR 2.2 (0.1) million.
- The comparable earnings per share were EUR 0.023 (0.010).
PRESIDENT & CEO ANDERS DAHLBLOM:
“In the first quarter of 2022, Glaston’s markets continued to develop positively and orders received were up 25% compared to the corresponding period in 2021, totaling EUR 59.0 million. In particular, the demand for insulating glass equipment increased but demand for automotive glass machines also saw good progress. From a regional point of view, America’s order intake was the highest of our regions and performance was excellent, particularly for Heat Treatment equipment. First-quarter net sales were up by 29% to EUR 52.3 million, primarily due to the good order intake in 2021. Comparable EBITA improved and was EUR 3.5 million, corresponding to an EBITA margin of 6.6%. Besides the volume growth, focused operational execution and good pricing management contributed to the outcome.
In the January−March period, the Services business was on a high level with an increasing number of inquiries as customers started ramping up their production. For upgrades, the good order intake continued with the Americas in the lead. Supply chain disruptions adversely impacted spare parts sales and delivery times.
Despite the significant underlying growth potential in our regions, signs of increasing market uncertainty and more cautious customer behavior have been perceptible, partly due to the Russian invasion of Ukraine and its related effects and, in some parts of the world, due to the COVID-19 pandemic. Furthermore, amid rising prices and supply imbalances, we can see decision times for new projects increasing.
Shortly after the invasion of Ukraine, it was already clear to us that continuing our operations in Russia was not an option. We have taken the necessary actions to close our sales office in Moscow and currently business with Russia is suspended. The financial impact of our exit decision is limited, as Russia accounted for less than one percent of our net sales in 2021. The invasion may further complicate the supply chain disruptions, with a shortage of various raw materials and components also leading to increasing costs. Mitigating the supply chain disturbances continues to be a key focus area.
In the first quarter, China saw a new outbreak of coronavirus. Restrictions and lockdowns were imposed in several cities thereby also affecting operations at Glaston’s factory in Tianjin. Additionally, some machine deliveries had to be postponed due to lockdown-related logistic challenges. Supply chain disruptions further complicated the situation. We are closely monitoring the development in China and its implications on the operating environment. In January−March, China’s share of total net sales amounted to approximately 15%. Prolonged restrictions and lockdowns would impact our business in the mid-term.
In 2022, Glaston is celebrating the International Year of Glass (IYOG 2022). To acknowledge the essential role glass has and will continue to have in society, the General Assembly of the United Nations has designated 2022 as the International Year of Glass (IYOG 2022). Glaston, as a member of the International Commission on Glass, the organization behind the IYOG 2022 initiative, will highlight the International Year of Glass throughout 2022.
In the review period, Glaston’s markets developed well. Despite increasing geopolitical turbulence and soaring COVID-19 numbers, the underlying demand for Glaston’s products and services remains good and our high order backlog will support our performance for the coming quarters.”
GLASTON GROUP’S KEY FIGURES
| MEUR | 1-3/2022 | 1-3/2021 | Change% | 1-12/2021 |
| Orders received | 59.0 | 47.2 | 24.9% | 216.2 |
| of which service operations | 18.8 | 17.5 | 7.9% | 68.0 |
| of which service operations, % | 31.9% | 37.0% | - | 31.4% |
| Order book at end of period | 98.1 | 68.0 | 44.3% | 94.8 |
| Net sales | 52.3 | 40.4 | 29.4% | 182.7 |
| of which service operations | 18.3 | 16.6 | 10.4% | 66.8 |
| of which service operations, % | 35.1% | 41.1% | - | 36.5% |
| EBITDA | 4.3 | 2.0 | 113.4% | 13.0 |
| Items affecting comparability1) | 0.2 | 0.8 | -80.6% | 1.5 |
| Comparable EBITDA | 4.4 | 2.8 | 57.0% | 14.5 |
| Comparable EBITDA, % | 8.5% | 7.0% | - | 7.9% |
| Comparable EBITA | 3.5 | 2.1 | 68.0% | 11.1 |
| Comparable EBITA, % | 6.6% | 5.1% | - | 6.1% |
| Operating result (EBIT) | 2.2 | 0.1 | 1966.1% | 5.1 |
| Profit/loss for the period | 1.2 | -0.7 | 271.4% | 1.1 |
| Comparable earnings per share, EUR | 0.023 | 0.010 | 130.0% | 0.060 |
| Cash flow from operating activities | -6.8 | 6.6 | -203.0% | 19.3 |
| Return on investment (ROI), %, (annualized) | 7.5% | 0.2% | - | 2.8% |
| Comparable return on capital employed (ROCE), %, (annualized) | 9.8% | 3.1% | - | 6.1% |
| Equity ratio, % | 53.7% | 40.0% | - | 42.3% |
| Net gearing, % | 36.4% | 41.8% | - | 26.9% |
| Number of employees at end of period | 761 | 721 | 5.5% | 750 |
1) + cost, - income
GLASTON’S OUTLOOK FOR 2022 REMAINS UNCHANGED
In 2021, Glaston’s markets saw a strong recovery and growth. This positive development continued in the first quarter of 2022, indicating good development for both machines and services business. Glaston started the year with a 48% higher order backlog than in 2021, which supports Glaston’s net sales and profitability development. In 2022, Glaston is focusing on the execution of its strategy, which will incur costs and capital expenditure ahead of the effect on revenue growth.
Currently, higher than normal uncertainty is related to the development of economic activity and customers’ investments. The uncertainty is driven by several simultaneous factors, such as the supply chain disturbances that have become a longer-term challenge, the Russian invasion of Ukraine with its implications on energy and raw material prices, and the still ongoing COVID-19 pandemic.
Despite the prevailing uncertainties, Glaston Corporation expects market development to continue to be positive and estimates that its net sales and comparable EBITA will improve in 2022 from the levels reported for 2021. In 2021, Group net sales totaled EUR 182.7 million and comparable EBITA was EUR 11.1 million.
PRESS MEETING
Glaston’s CEO Anders Dahlblom and CFO Päivi Lindqvist will present the financial result to analysts, investors and media representatives TODAY at 10:30 (Finnish time) in English.
The audiocast can be accessed through the link: https://glaston.videosync.fi/results-q1-2022/register. An on-demand version of the presentation will be available on the company's website later during the same day.
For further information, please contact:
President & CEO Anders Dahlblom, 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 5076
Glaston in brief
Glaston is the glass processing industry’s innovative technology leader supplying equipment, services and solutions to the architectural, automotive, solar and display 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 10 countries and its shares (GLA1V) are listed on NASDAQ Helsinki Ltd.
Distribution: Nasdaq Helsinki Ltd, key media, www.glaston.net.