Exel Composites Plc’s January–June Half-year Financial Report 2017: “Significant increase in order intake, revenue and operating profit”
EXEL COMPOSITES PLC – HALF-YEAR FINANCIAL REPORT – 20 JULY 2017 at 10:00 EET
Q2 2017 in brief
- Order intake increased by 15.5% to EUR 23.4 million (Q2 2016: 20.2).
- Revenue increased by 17.4% to EUR 23.2 million (19.7).
- Adjusted operating profit improved to EUR 1.7 million (1.2), which is 7.4% of revenue (5.9%).
- Net cash flow from operating activities was EUR 1.1 million (0.3).
- Earnings per share amounted to EUR 0.09 (0.07).
H1 2017 in brief
- Order intake increased by 19.8% to EUR 45.8 million (38.3).
- Revenue increased by 15.4% to EUR 43.4 million (37.6).
- Adjusted operating profit amounted to EUR 3.4 million (1.3), which is 7.8% of revenue (3.5%).
- Net cash flow from operating activities was EUR 0.3 million (-0.5).
- Earnings per share amounted to EUR 0.18 (0.07).
Outlook for full year 2017
Exel Composites reiterates its outlook for 2017 and estimates that revenue with comparable company structure (i.e. without the acquisition of Nanjing Jianhui Composite Material, JHFRP) will increase from previous year level and adjusted operating profit will be higher than previous year level. In 2016, Exel Composites’ revenue was EUR 73.1 million and adjusted operating profit was EUR 2.6 million.
President and CEO, Riku Kytömäki
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.
Consolidated key figures
|EUR thousand||1.4.–30.6. 2017||1.4.–30.6. 2016||Change, %||1.1–30.6. 2017||1.1.–30.6. 2016||Change, %||1.1.–31.12. 2016|
|% of revenue||6.4||5.8||7.2||3.4||0.9|
|Adjusted operating profit²||1,722||1,167||47.6||3,387||1,316||157.4||2,621|
|% of revenue||7.4||5.9||7.8||3.5||3.6|
|Profit for the period||1,060||882||20.2||2,166||880||146.2||198|
|Net cash flow from operating activities||1,101||342||221.9||253||-520||148.7||3,129|
|Return on capital employed, %||14.9||11.4||16.0||6.5||1.7|
|Net gearing, %||29.3||18.4||29.3||18.4||12.2|
|Earnings per share||0.09||0.07||0.18||0.07||0.02|
|Equity per share, EUR||2.3||2.35||-2.1||2.3||2.35||-2.1||2.27|
|Employees on average||534||487||9.7||498||490||1.6||479|
¹ As per the end of the period.
² Excluding material items affecting comparability, such as restructuring costs, impairment losses and reversals, and costs related to planned or realized business acquisitions or disposals. For more information, please refer to the paragraph “Change in Exel Composites’ financial reporting terminology” of the Half-year Financial Report published on 21 July 2016.
Exel Composites’ half-year financial report January – June 2017 is available in full in pdf format as an attachment to this release. The report and the related presentation are also available at the company’s website under the Investor section.
Vantaa, 20 July 2017
Exel Composites Plc
Board of Directors