Date: 27 October 2020
This release is a summary of Glaston Corporation's January-September 2020 interim report. 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.
This third-quarter interim report provides estimates on future prospects involving risk and uncertainty factors, and other factors as a result of which the performance, operation, or achievements of Glaston may substantially deviate from the estimates. Forward-looking statements relating to future prospects are subject to risks, uncertainties and assumptions, the implementation of which depends on the future business environment and other circumstances, such as the development of the COVID-19 pandemic.
JULY–SEPTEMBER 2020 IN BRIEF
- Orders received totaled EUR 33.3 (45.6) million
- Net sales totaled EUR 35.9 (54.5) million
- Comparable EBITA was EUR 1.3 (3.1) million, i.e. 3.6 (5.7)% of net sales
- The operating result (EBIT) was EUR -0.5 (-0.0) million
- The comparable operating result (EBIT) was EUR 0.2 (2.0) million, i.e. 0.5 (3.6)% of net sales
- Items affecting comparability totaled EUR -0.7 (-2.0) million
- Comparable earnings per share were EUR -0.013 (0.015)
- Cash flow from operating activities was EUR 0.6 (5.7) million
JANUARY–SEPTEMBER 2020 IN BRIEF
- Orders received totaled EUR 102.9 (113.0, pro forma 135.4) million
- Net sales totaled EUR 131.8 (133.7, pro forma 157.3) million
- Comparable EBITA was EUR 5.7 (7.3, pro forma 9.6) million, i.e. 4.3 (5.5, pro forma 6.1)% of net sales
- The operating result (EBIT) was EUR 0.2 (-0.3, pro forma 1.2) million
- The comparable operating result (EBIT) was EUR 2.3 (4.6, pro forma 6.1) million, i.e. 1.8 (3.4, pro forma 3.9)% of net sales
- Items affecting comparability totaled EUR -2.1 (-4.9, pro forma -4.9) million
- Comparable earnings per share were EUR -0.013 (0.014)
- Cash flow from operating activities was EUR -2.8 (2.1) million
GLASTON’S OUTLOOK FOR 2020 REMAINS UNCHANGED
Glaston Corporation estimates that comparable EBITA for 2020 will decline from the 2019 level. The company’s current assessment is that fourth-quarter orders will improve from the third quarter but remain below the previous year’s levels. The lower than 2019 order intake and lower than normal volume in services business impacts the development of net sales and earnings in 2020. The uncertainty surrounding the assessment remains, and the situation might change quickly depending on the development of the COVID-19 pandemic and the general economic climate.
ACTING PRESIDENT & CEO SASU KOIVUMÄKI:
Multifaceted quarter: The Insulating Glass segment performed well, Heat Treatment and Services slower than expected – profitability satisfactory under the circumstances
“Glaston’s third quarter development was multifaceted. The Insulating Glass (IG) business performed well with a faster than expected recovery in Europe, and several larger projects were picked up after the slow development in the previous quarter. Insulating Glass equipment and services order intake grew by 3% from the corresponding period last year, which gives the IG business a very good start to 2021. On the other hand, the market for Heat Treatment (HT) equipment and services remained very challenging. There is a significant difference in demand between the HT and the IG equipment markets. In the commercial building market, which is the main market for HT, forecasts are weak whereas the residential building market, important for IG, continues to grow. Consequently, we see a clear need to adapt our Heat Treatment business to current market demand. The Automotive business remains challenging due to overcapacity in the market. The short-time work implemented last year continues, and we are monitoring the situation very closely. During the quarter, we saw an increase in our Services business from the very low previous quarter, although recovery was slower than expected, mainly due to the remaining cross-border travel restrictions and restrictions on customer factory visits.
As a result of the low order intake in the previous quarters and the postponement of a number of orders, our net sales decreased in all segments. Third-quarter Group net sales totaled EUR 35.9 million. Our profitability was clearly impacted by low sales volumes in both HT and Automotive equipment and services but overall remained at a satisfactory level, supported by our rapid measures and synergy benefits. Demand for HT spare parts and service work was low, but demand for IG services was at a good level. Due to the current crisis, the Emerging Technologies (ET) market continued to be slow in the third quarter, but ET continued to develop its selected consulting projects together with its partners.
With the broadest and most versatile glass processing product and services portfolio, combined with innovation leadership, Glaston has a strong position in the market. In order to remain at the forefront of development we have continued to put significant efforts in 2020 into the continuous development of our core technology portfolio and R&D. The latest showcase of this work is Glaston’s cup wheel technology for glass edge arrissing of architectural glass which was presented at the virtual Glasstec fair in mid-October. Demand for arrissed glass is driven by stricter safety regulations and higher quality requirements.
Mitigating COVID-19 related near-term business disruptions continues to be high on our agenda and we are ready to reinstate measures to safeguard the health and safety of our employees and to safeguard the company’s financial stability quickly if necessary. We continue to constantly monitor the development of the situation, our orders and order book as well as the company’s cash flow and liquidity.”