Year-end Report January-December 2019
Hillerstorp 10th of February 2020, 12:30 CET
OCTOBER - DECEMBER
- Order intake was unchanged compared to prior year and amounted to 41,8 (41,7) MEUR.
- Sales increased organically by 2 per cent to 44,4 (43,5) MEUR. Adjusted for currency the increase was 1 per cent.
- Operating profit decreased to 8,7 (10,1) MEUR.
- Operating margin decreased to 19,6 (23,2) per cent.
- Financial net was -0,2 (-0,1) MEUR.
- Profit after tax decreased to 6,4 (7,9) MEUR.
- Earnings per share after dilution amounted to 0,11 (0,13) EUR based on 60 000 000 shares regarding both periods. (a split 3:1 was carried out in June 2019).
JANUARY – DECEMBER
- Order intake increased organically by 2 per cent to 168,1 (165,0) MEUR. Adjusted for currency the increase was 1 per cent.
- Sales increased organically by 4 per cent to 168,0 (161,0) MEUR. Adjusted for currency the increase was 4 per cent.
- Operating profit increased to 32,9 (32,8) MEUR.
- Operating margin decreased to 19,6 (20,4) per cent.
- Financial net was -0,9 (-0,8) MEUR.
- Profit after tax decreased to 24,3 (24,4) MEUR.
- Earnings per share after dilution amounted to 0,41 (0,41) EUR based on 60 000 000 shares regarding both periods. (a split 3:1 was carried out in June 2019).
- The board suggest a dividend of 0,19 (0,16) EUR per share based on 60 000 000 shares regarding both periods and based on the year-end SEK/EUR rates which are presented below.
Order intake reached last year's good figures despite a pending market situation. For two quarters, in a market lacking any widespread growth, Troax showed strength having an order intake in line with the previous year. This indicates the market is still standing at a high level. During the 4th quarter we have noted continued weak activity from the automotive sector, mainly affecting China and the US (Folding Guard). In Europe, the market situation is stable, and we continue to gain market share, primarily within more demanding customer segments. We have again received several important orders from customers in automation, warehousing and property protection, and we have also received interesting orders in the automated warehouse sub-segment, although not at the same level as in the corresponding quarter last year. Our unit in Chicago, Folding Guard, has now greatly improved delivery service, product quality and to some extent also productivity. The main focus now is on increasing orders and sales, which are still below the desired level. We expect orders to start improving in 2020.
Investments in increased production capacity at our plants in Sweden and Italy are still going according to plan and at the time of writing, the new factory in Italy is being started. The new plant comprises some 20.000 square meters and is equipped with solar panels meeting half the energy needs for the facility. With investments in this new plant and machinery, we are very well equipped for a continued increase in volume over the next few years. As a minor change, we acquired a distributor in Japan during the fourth quarter, which will be consolidated in its entirety from 2020. This acquisition gives us the opportunity to invest more in an interesting market, where there is an increasing demand for our safety products.
Net sales increased marginally in the 4th quarter compared to the corresponding period last year. The trend is positive in the UK. Gross margin is stable, however, the result for the quarter is lower than last year due to relocation costs with the new Italian factory (EUR -0,4 million) and negative currency translation effects. We have continued to increase sales and marketing efforts according to plan, although to a somewhat lower extent than earlier in the year. Although we have increased machine capacity, Troax has continued the good utilization of capacity in our plants in Hillerstorp, Sweden and Calco, Italy. For the Group, the operating margin was 19,6 percent in the quarter, compared with 23,2 the previous year. Folding Guard continues to negatively affect the Group's operating margin. Net profit amounted to EUR 6,4 million for the quarter compared to EUR 7,9 million last year.
For the full year, we almost reached our target of 20% in the operating margin despite some start-up costs in Italy and a weak start to the year. Profit per share for the fourth quarter is EUR 0,11 compared to EUR 0,13 in 2018. For 2019 full year the earnings per share was EUR 0,41, which is the same level as 2018. As we have now implemented the previously decided major investments, the Board of Directors proposes to increase the dividend by 20%. Working capital is at the expected level. Cash flow during the quarter is in line with the corresponding period 2018. Investments have charged cash flow with MEUR 9,1 during the year.
Thomas Widstrand, President and CEO
Invitation to presentation of the fourth quarter result:
Thomas Widstrand, CEO presents the result on a phone conference on the 10th of February 2020 at 16:30 CET. The conference will be held in English. For more information, please refer to https://www.troax.com/global/en/press
This information is information that Troax Group AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation 596/2014. The information was submitted for publication, through the agency of the contact person set out above, at 12:30 CET on the 10th of February 2020.
For additional information, please contact:
President and CEO
Troax Group AB
335 04 Hillerstorp
Tel 46 (0)370-82831
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 42 countries.
In 2019 Troax net sales amounted to around 168 MEUR and the number of employees amounted to about 700 persons. The Company’s head office is located in Hillerstorp, Sweden.