Glaston’s interim report January─March 2024: Net sales and comparable EBITA improved, markets remained challenging
GLASTON CORPORATION INTERIM REPORT 3.5.2024 AT 8.30
This release is a summary of Glaston Corporation's Interim Report for January−March 2024. 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 2024 IN BRIEF
- Orders received totaled EUR 46.6 (56.9) million.
- Net sales totaled EUR 55.8 (51.3) million.
- Comparable EBITA was EUR 3.6 (3.0) million, i.e. 6.4 (5.8)% of net sales.
- The operating result (EBIT) was EUR 1.9 (1.9) million.
- The comparable earnings per share were EUR 0.019 (0.019).
GLASTON’S OUTLOOK FOR 2024 REMAINS UNCHANGED
The cautious development in the architectural glass processing equipment markets continued in the first quarter of the year. Despite the slow start, Glaston expects the architectural glass processing equipment markets to start recovering at some point in 2024. For mobility glass processing equipment, the positive development in China is expected to continue. Amid global economic uncertainty and increased geopolitical tensions, higher-than-normal uncertainty exists concerning customers’ decision-making.
Glaston started the year with a lower order backlog than the previous year. However, given the expected slowly 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:
“We had a good first quarter despite the challenging market environment. Glaston’s markets saw a cautious start to the year. Demand for tempering and laminating equipment continued to soften, whereas demand for insulating glass technologies, supported by climate-related drivers, was stable. The good demand for pre-processing technologies in China continued.
Glaston’s order intake was down 18% year-on-year. In addition to the sluggish market, the timing of some projects also affected the outcome. The order intake for tempering and laminating technologies and for mobility, display, and solar technologies fell compared to the comparison period. Despite the softer market, the order intake for insulating glass technologies increased slightly. Services’ order intake also had a small increase. The geographical breakdown of the order intake was not typical for Glaston as APAC, driven primarily by China, for the first time emerged as the largest region followed by EMEA and the Americas.
First-quarter net sales were up 9% to EUR 55.8 million, primarily due to the good order intake for pre-processing equipment in China in the second half of 2023. Comparable EBITA improved and was EUR 3.6 million. The higher volume in Mobility, Display, and Solar was the main contributor to the outcome.
Due to the significant changes in the global economy and Glaston’s addressable markets starting to soften in 2023, we announced in February that the timeframe for achieving our strategic targets had been adjusted from 2025 to the medium-term (3−5 years). The net sales and ROCE targets were also slightly updated. We expect annual average net sales growth to exceed the addressable equipment market growth and the target for comparable return on capital employed (ROCE) is above 16%. The target for comparable operating margin (EBITA) of 10% remained unchanged. It is very clear to us that these targets cannot be met through machine sales alone and the role of the Services business is crucial in reaching the operating margin target. We continue to develop our service portfolio and the capabilities of the global service network.
Currently, activity in the Architectural market has slowed down. We have already initiated cost-saving actions and will take further measures according to the situation. Glaston has a broad and versatile product and services portfolio, and our markets consist of many different market areas and countries, which provides stability. Our ongoing product development will increase our competitive position, and the industry trends, especially automation and the focus on energy-efficient glass products will support our strategic direction.
Safety continued to be a key focus area. In the January−March period, no lost time accidents were reported. However, zero accidents do not automatically mean operations are completely safe. We must continue to further develop the safety culture and e.g. be more observant of near-misses and unsafe conditions. This also applies to activities outside Glaston's premises, such as employees working at customers’ sites.
The recruitment process to hire the company’s new CEO was completed in the quarter and Toni Laaksonen was appointed as Glaston’s new President and CEO. He will take up his new position at the latest at the end of September 2024. We warmly welcome Toni to Glaston!”
GLASTON GROUP’S KEY FIGURES
| MEUR | 1-3/2024 | 1-3/2023 | Change% | 1-12/2023 |
| Orders received | 46.6 | 56.9 | -18.0% | 220.3 |
| of which service operations | 18.9 | 18.5 | 2.2% | 74.4 |
| of which service operations, % | 40.5% | 32.5% | 33.8% | |
| Order book at end of period | 101.4 | 139.0 | -27.1% | 106.5 |
| Net sales | 55.8 | 51.3 | 8.8% | 219.7 |
| of which service operations | 17.8 | 18.0 | -1.2% | 76.0 |
| of which service operations, % | 31.8% | 35.0% | 34.6% | |
| EBITDA | 4.1 | 3.7 | 10.1% | 15.7 |
| Items affecting comparability (1 | 0.6 | 0.3 | 69.2% | 3.3 |
| Comparable EBITDA | 4.6 | 4.0 | 15.0% | 19.0 |
| Comparable EBITDA, % | 8.3% | 7.8% | 8.7% | |
| Comparable EBITA | 3.6 | 3.0 | 18.5% | 14.9 |
| Comparable EBITA, % | 6.4% | 5.8% | 6.8% | |
| Operating result (EBIT) | 1.9 | 1.9 | 1.9% | 8.1 |
| Profit/loss for the period | 0.8 | 1.1 | -21.5% | 5.0 |
| Comparable earnings per share, EUR | 0.019 | 0.019 | -2.5% | 0.104 |
| Cash flow from operating activities | -7.5 | -0.5 | -1,515.0% | 13.8 |
| Return on capital employed (ROCE), %, (annualized) | 10.4% | 7.3% | 8.1% | |
| Comparable return on capital employed (ROCE), %, (annualized) | 12.3% | 8.9% | 12.7% | |
| Equity ratio, % | 44.9% | 45.6% | 45.2% | |
| Net gearing, % | 28.1% | 23.2% | 15.8% | |
| Number of employees at end of period | 800 | 800 | 0.0 % | 802 |
- + cost, - income
PRESS MEETING
Interim CEO Antti Kaunonen and CFO Päivi Lindqvist will present the financial result to analysts, investors and media representatives today at 11:00 (Finnish time) in English.
The audiocast can be accessed through the link: https://glaston.videosync.fi/q1-2024/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:
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 5076
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.