TROAX: YEAR-END REPORT 2017
Hillerstorp 12th of February 2018, 12.30 CET
OCTOBER – DECEMBER 2017
- Order intake increased by 17 per cent to 38,4 (32,8) MEUR. Adjusted for acquisition and currency the increase was 4 per cent.
- Sales increased 29 per cent to 41,0 (31,9) MEUR. Adjusted for acquisition and currency the increase was 15 per cent.
- Operating profit decreased to 8,3 (9,4) MEUR. Prior year a redemption of the bond and the revaluation of the pension liability influenced the operating result positively by 1,2 MEUR.
- Operating margin decreased to 20,2 (29,5) per cent.
- Financial net was -0,3 (-1,1) MEUR, a decrease that is related to the redemption of the bond that took place in June 2017.
- The cost for income tax is impacted by -2,2 MEUR due to a reduction of corporation tax in USA from 35% to 21%. The impact is related to the acquisition of Folding Guard.
- Profit after tax decreased to 4,1 (6,4) MEUR.
- Earnings per share decreased to 0,21 (0,32) EUR.
JANUARY – DECEMBER 2017
- Order intake increased by 27 per cent to 152,0 (119,6) MEUR. Adjusted for acquisition and currency the increase was 13 per cent.
- Sales increased 31 per cent to 152,1 (115,8) MEUR. Adjusted for acquisition and currency the increase was 17 per cent.
- Operating profit increased to 30,6 (25,3) MEUR.
- Operating margin increased to 20,1 (21,8) per cent.
- Financial net was -5,2 (-3,9) MEUR of which -2,3 MEUR is related to a one-time cost related to the redemption of the bond.
- The cost for income tax is impacted by -2,2 MEUR due to a reduction of corporation tax in USA from 35% to 21%. The impact is related to the acquisition of Folding Guard.
- Profit after tax increased to 17,1 (16,3) MEUR.
- Earnings per share was 0,86 (0,82) EUR.
- The board suggest a dividend of 4,25 (3,75) SEK (Swedish Krona) per share
CEO COMMENTS
Troax had a continued good development during the fourth quarter 2017. The organic growth was 4 percent in orders received, and was not impacted by bigger one-time orders from the automotive industry which was the case in the same quarter of last year. However, the growth is to some extent lower in the fourth quarter also excluding these orders. The Group’s order intake of the year was around 152 MEUR which is an increase of 27% or 13% excluding acquisition and currency. We have again received several important orders from customers within automotive, warehouse and property, which shows that the Troax offering is strong. The USA based company Folding Guard that was acquired in late 2016 is generally following their plans and has a positive trend. Our judgment also for this quarter is that the market development has been positive for the Group. The growth has been especially strong in Continental Europe and Nordic region, but also New markets have had a positive quarter. In the UK, we have again during the fourth quarter seen some negative effects of a weaker willingness to invest at some customer groups, probably caused by the uncertainty related to among others the Brexit issue. The orderbook at the end of the quarter is on a satisfying level.
The integration work of the acquired company (end of last year), Folding Guard is progressing well. The focus to realize the growth synergies from the acquisition remains strong and is expected to deliver greater effects during 2018. We can again confirm that the acquisition has so far been well received by important customers in the US. We see good opportunities to strengthen the customer base, long term, for both brands in the important market of North America. During 2018 we are planning to start up production of Troax products in our Chicago factory.
Sales increased in the quarter by 29 per cent compared with the same period last year (excluding acquisition and currency the increase is 15 per cent). The progress was positive in all markets except UK.
The result for the quarter is on the same level as last year if we exclude the impact from the redemption of the bond and the revaluation of the pension liability from last year’s fourth quarter.
We have now started to invest in marketing for both mature and new markets after having focused more on the integration of Folding Guard in 2017. For full year, excluding the impact from Folding Guard, the operating margin is at the same level in 2017 as in 2016.
The operating result was 8,3 (9,4) MEUR, which corresponds to a profit margin of 20,2 per cent to be compared with 29,5 per cent last year. It should be noted that the consolidation of Folding Guard still decreases the margin in percentage terms. We do however see clear possibilities to increase the margin also for Folding Guard long term.
The cost for income tax is impacted by -2,2 MEUR due to a reduction of corporation tax in USA from 35% to 21% and is related to a decrease in deferred tax assets that arose in conjunction with the acquisition of Folding Guard. The Net result amounts to 4,1 MEUR for the quarter compared to 6,4 MEUR last year.
The earnings per share for the fourth quarter are 0,21 EUR and for the year 0,86 EUR to be compared with 0,32 and 0,82 EUR respectively in 2016. Excluding the additional income tax cost of -2,2 MEUR in the fourth quarter the earnings per share is 0,32 EUR for the for the quarter and 0,97 EUR for the year.
The Working Capital is improved to some extent compared to previous quarter. Work in Progress has decreased and has transformed to accounts receivables as the sales has been good for the quarter. We have continued with good cash generation during the quarter and the net debt is now 54 MEUR and the key figure of our interest-bearing loan in comparison with EBITDA is now 1,6 which clearly is below our target for the Group. As the volume growth has been strong during the last years we have decided to increase the production capacity in our main factory in Hillerstorp. This will render an investment of approximately 5 MEUR and the machine is expected to be in production by the end of 2018.
Thomas Widstrand, President and CEO
PHONE CONFERENCE
Invitation to presentation of the second quarter result:
Thomas Widstrand, CEO presents the result on a phone conference on the 12th of February 2018 at 16:00 CET.
The conference will be held in English.
For more information, please refer to https://www.troax.com/en/news.
This information is information that Troax Group AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 12:30 CET on 12th of February 2018.
Thomas Widstrand
President and CEO
Troax Group AB
Box 89
335 04 Hillerstorp
Sweden
Tel 46 (0)370-82831
thomas.widstrand@troax.com
About Troax
Troax is the leading global supplier of indoor perimeter protection (“metal-based mesh panel solutions”) for the market segments: Machine guarding, Warehouse partitioning and Property Protection. Troax develops high quality and innovative safety solutions to protect people, property and processes.
Troax Group AB (publ), Reg. No. 556916-4030, has a global organisation with a strong sales force and efficient logistics setup, enabling local presence and short delivery times in 36 countries.
In 2017 Troax net sales amounted to around 152 MEUR and the number of employees amounted to abtou 670 persons. The Company’s head office is located in Hillerstorp, Sweden.
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