President & CEO
Riku Kytömäki

Exel Composites Plc’s January–June Half-year Financial Report 2017

“Significant increase in order intake, revenue and operating profit”

 

In the first half of 2017 order intake, revenue and operating profit continued to develop positively. In the second quarter, the double digit growth was led by volume increase from new customers, and supported by a general market environment recovery. The strong order intake and order backlog in the first quarter also contributed to the significant increase in revenue for the first half of 2017.

The Industrial Applications customer segment continued to drive volume growth during the review period. We continued to gain momentum especially in the mid-segment through our efforts and focus on new customer acquisition. Despite lower margin structure, the mid-segment products contributed positively to the operating profit through higher volumes. 

From a regional perspective Asia – and China in particular – was a major contributor to the increase in revenue in the first half of the year. Volume growth was mainly organic and only partially affected by the newly acquired Nanjing Jianhui Composite Material, JHFRP. Also in Europe revenue has developed well and increased in comparison to the same period last year.

Major factors behind the continued improvement in operating profit were the significantly higher revenue and the lower cost base. The cost savings measures from 2016 continued to contribute to an overall reduced cost level. Improvements in operational efficiency, including the downsizing in Australia, also contributed to the improvement in the operating profit. The downsizing of the Australian unit is progressing according to plan and we expect production there to cease by the end of this year.

The acquisition of Nanjing Jianhui was successfully completed in April 2017 and was consolidated into Group accounts as of 1 May 2017. The integration process proceeds according to plan. Nanjing Jianhui is an important element of our growth strategy in China as it strengthens our position in the Chinese market and improves our export capacity to other markets.

To sum it up; the results of the first half of 2017 reflect good growth in our focus segments and a continued tight cost control. 

Exel Oyj, Vantaa head office, Mäkituvantie 5, FI-01510 Vantaa, Finland, Tel +358 20 7541 200, Fax +358 20 7541 201