Annons
Raute Oyj: Raute Corporation - Financial statements release January 1-December 31, 2021

RAUTE CORPORATION FINANCIAL STATEMENTS RELEASE FEBRUARY 11, 2022 AT 9:05 A.M.

RAUTE CORPORATION - FINANCIAL STATEMENTS RELEASE JANUARY 1 - DECEMBER 31, 2021

This is a summary of Raute's Financial statements release January 1 - December 31, 2021. The full report is a PDF file attachment to this stock exchange release and is also available on the company's website at www.raute.com.

- The Group's net sales amounted to EUR 142.2 million (MEUR 115.0), up 24% on the comparison year. Order intake, at EUR 203 million (MEUR 119), was at a record level and increased by 71%. The order book at the end of the year, EUR 158 million (MEUR 94), was also record high.

- Operating profit, at EUR -2.2 million (MEUR -2.8) increased 21%. The profit before taxes was EUR -1.8 million (MEUR -2.5). Profit for the financial year was EUR -1.8 million (MEUR -1.8).

- The operating profit was weakened by a change in the accounting treatment of EUR 2.0 million in costs for an IT system project.

- Undiluted earnings per share were EUR -0.42 (EUR -0.43), and diluted earnings per share EUR -0.42 (EUR -0.43).

- Fourth-quarter net sales amounted to EUR 44.1 million (MEUR 38.9) and operating profit to EUR 0.5 million (MEUR 0.3). Order intake was EUR 50 million.

- The Board of Directors will propose to the Annual General Meeting that a dividend of EUR 0.80 (EUR 0.80) per share be paid for the financial year 2021.

Raute's 2022 net sales are expected to grow and operating profit is expected to improve from 2021.

1.10. -31.12. 1.10. -31.12. 1.1. -31.12. 1.1. -31.12.
KEY FIGURES 2021 2020 2021 2020
Net sales, MEUR 44,1 38,9 142,2 115,0
Change in net 13,3 -0,9 23,7 -24,0
sales, %
Exported portion 95,3 95,0 91,8 94,2
of net sales, %
Operating profit, 0,5 0,3 -2,2 -2,8
MEUR
Operating profit, 1,2 0,7 -1,6 -2,4
% of net sales
Profit before 0,6 0,2 -1,8 -2,5
taxes, MEUR
Profit before 1,3 0,5 -1,2 -2,1
taxes, % of net
sales
Profit for the 0,8 0,8 -1,8 -1,8
period, MEUR
Profit for the 1,7 2,1 -1,2 -1,6
period, % of net
sales

Gross capital 0,0 0,0 6,3 3,5
expenditure, MEUR
% of net sales 0,0 0,1 4,4 3,1

Research and 1,3 1,4 4,9 4,6
development costs,
MEUR
% of net sales 2,9 3,6 3,5 4,0

Order book, MEUR 158 94 158 94
Order intake, MEUR 50 70 203 119

Personnel, at the 802 751
end of the period
Personnel, 780 743
effective, on
average
Personnel, on 788 760
average

TAPANI KIISKI, PRESIDENT AND CEO: HEADING INTO 2022 WITH A RECORD-HIGH ORDER BOOK

In 2021, the market situation improved in several markets compared to the previous year. This applies, in particular, to our traditional, industrialized and developed markets in Europe, North America and especially Russia. These markets were our focal areas last year and this will not change in the foreseeable future. In the emerging markets and especially in China, the pandemic-related restrictions are still limiting the progress of our customers' projects and impacting our business. In the longer term, we believe that the focus of growth will again shift to the emerging markets.

In the final quarter of the year, we received new orders worth around EUR 50 million. This is an excellent achievement, considering that the figure does not include mill projects. Mid-sized single production line orders and modernization orders were at a good level, confirming our view that the markets are enjoying a strong momentum. The order intake for technology services and our analyzer products was at a particularly good level thanks to modernization-related projects. That shows that our customers' desire to systematically improve the safety, quality and efficiency of their operations is on a good level.

Our order book is at an all-time high of EUR 158 million, so our outlook for the near future is good. The record-high number of new orders received during the whole year, at more than EUR 203 million, is something to be especially pleased about.

Our net sales grew from the previous year by 24% to EUR 142.2 million. In the fourth quarter, our net sales grew almost as planned, although the delays in project deliveries caused by problems in the availability of raw materials and components, coupled with, among other things, the shutdown of our main production plant due to Covid-19 cluster infections and the ongoing industrial action with an overtime ban, meant that we failed to reach our best performance. Although the earnings performance improved towards the end of the year, our operating profit remained, to my disappointment, at the previous year's level.

We have continued to invest in our stated strategic priorities, the emerging markets and the development of our technology services business and digitalization, without forgetting traditional high-technology production process solutions. All these measures are aimed at improving our earnings power. Besides the opportunities offered by the current market situation, our strong financial position and market position and our long-standing customer relationships are important competitive advantages and enablers of this type of long-term work.

The extensive project to renew our operating processes and our IT systems implemented as cloud-based services will continue in 2022 and will significantly improve Raute's earnings power once completed.

In April 2021, the IFRS Interpretations Committee (IFRIC) issued its final agenda decision on the accounting treatment of configuration and customization costs of cloud-based systems. After analyzing the impacts of the agenda decision, we recognized, as announced on January 25, 2022, a total of EUR 2.9 million of the renewal project's capitalized costs as expenses, of which EUR 2.0 for the financial year 2021 and EUR 0.9 million retroactively for the financial year 2020. The project will have an impact of roughly the same size on the profit for 2022 as in 2021.

The excellent order book, continued strong demand and the lifting of travel restrictions that we expect to take place gradually make us confident that business will gradually return to normal over the next few months. However, many raw material, component and freight costs have risen, delivery times have increased and there have even been challenges in availability due to the exceptional market changes caused by the pandemic and the stimulus measures aimed at recovering from it. We expect the rising prices to affect the profitability of future projects in terms of deals and offers made before the sharp upturn in prices began. The higher material and freight costs and lengthened delivery times already had a negative impact on our fourth-quarter net sales and profit. These challenges are expected to continue in 2022. Our operational organization is actively working to resolve these issues together with our partners. In terms of new orders, I believe we will be able to transfer most of the cost increases to our prices. The global political uncertainty especially related to the Russian markets maintain near-term risks.

Raute's 2022 net sales are expected to grow and operating profit is expected to improve from 2021.

I want to express my warmest thanks to our customers for their continued cooperation with us, to our shareholders for their trust in Raute's business and especially to our personnel for their hard work and commitment in the year 2021.

BUSINESS ENVIRONMENT

Market situation in customer industries

Raute's customers in the veneer, plywood and LVL (Laminated Veneer Lumber) industries are engaged in the manufacture of wood products used in investment projects and are thus affected by fluctuations in construction, housing-related consumption, international trade, and transportation. We expect that the trend-like growth in wood construction will create demand for our customers and indirectly for Raute, strengthening our long-term growth opportunities.

In the fourth quarter, the situation and outlook in the global economy and the financial markets remained good, although inflationary concerns over the rising raw material and transport costs increased uncertainty especially at the end of the period. Vaccinations and the easing of the Covid-19 pandemic in many market areas created positive expectations, despite the continuing uncertainty, and demand remained strong. The strong rise in the prices of our customers' products leveled out and, for some products, began to decline. Prices nevertheless remained at a historically good level. We expect the market situation for our customer industries to remain good.

Demand for wood products technology and technology services

As a result of the exceptional volatility in the market situation caused by the Covid-19 pandemic, many of our customers, particularly in traditional, developed markets, initially put the brakes on their investments, and then, during the past year, accelerated them and cleared their investment backlog. This development was further strengthened by the strong demand for wood products. In contrast, emerging markets have not made similar progress in recovering from the pandemic. Demand for Raute's products and services has thus remained low in these markets. Demand overall was at a good level last year. The planning of mill-scale projects is also moving forward in several market areas.

Investment activity among Raute's customers has strengthened compared to the previous year. The order intake during the period under review was very good. Even without the reported new capacity projects, which are one-off in nature, the number of new orders was good.

Demand was particularly high in Russia. However, forecasting the realization and timing of large projects is difficult. The pandemic continued to have a major impact on the emerging markets of Asia and South America, which were quiet. Also in China, the pandemic-related precautionary measures continued, hampering the progress of projects, in addition to which the general economic development was slower than usual. Demand continued to be active in Europe and North America, and the order intake was at a good level.

Demand for maintenance and spare parts services remained good, which is an indication of the generally good capacity utilization rates of Raute's customers' production plants. In our estimation, without the travel restrictions related to the pandemic, sales of maintenance services would have been even stronger than they were.

BOARD OF DIRECTORS' PROPOSAL CONCERNING PROFIT DISTRIBUTION, DIVIDEND EUR 0.80 PER SHARE

On December 31, 2021, the parent company Raute Corporation's distributable assets totaled EUR 27,545 thousand, of which EUR 2,713 thousand represents the loss for the financial year January 1 - December 31, 2021.

The Board of Directors will propose to Raute Corporation's Annual General Meeting, to be held on March 31, 2022, that a dividend of EUR 0.80 per share be paid to holders of series A and K shares for the financial year 2021, and that the remainder of distributable assets be transferred to equity.

On the date of the profit distribution proposal, the number of shares entitling to a dividend is 4,263,194 shares, which would amount to total dividends of EUR 3,411 thousand. Shareholders who are registered in the shareholders' register maintained by Euroclear Finland Ltd on the record date for dividend distribution, April 4, 2022, are entitled to dividends. The dividend payment date would be April 11, 2022.

No essential changes have taken place in the company's financial position since the end of the financial year. The company has good liquidity, and in the Board of Directors' view, the proposed dividend does not pose a risk to solvency.

OUTLOOK FOR 2022

Due to the strong order book, active demand and further alleviated impacts of the coronavirus pandemic, Raute's 2022 net sales are expected to grow and operating profit is expected to improve from 2021.

RAUTE CORPORATION

Board of Directors

BRIEFING ON FEBRUARY 11, 2022 AT 2 P.M.:

A briefing will be organized for analysts, investors and the media on February 11, 2022 at 2 p.m. at Scandic Simonkenttä Hotel, Mansku cabinet, Simonkatu 9, Helsinki. The financial statements will be presented by Mr. Tapani Kiiski, President and CEO, and Ms. Tarja Järvinen, CFO. The event can also be watched online via Teams. We will send a Teams link to those who have registered by email; registrations at

ir@raute.com.The event will be recorded, and the recording can be viewed on Raute's website www.raute.com later on the same day, February 11, 2022.

FINANCIAL RELEASES IN 2022:

Raute's half-year report and two interim reports will be published as follows:

-Interim report January-March on Friday, April 29, 2022

-Half-year report January-June on Friday, July 22, 2022

-Interim report January-September on Friday, October 21, 2022

Raute Corporation's consolidated financial statements will be published on February 18, 2022. Raute Corporation's Annual Report 2021 will be published the week of March 1st.

Raute Corporation's Annual General Meeting will be held in Lahti, at Sibelius Hall on Thursday, March 31, 2022 at 6:00 p.m.

FURTHER INFORMATION:

Mr. Tapani Kiiski, President and CEO, Raute Corporation, mobile phone +358 400 814 148

Ms. Tarja Järvinen, Group Vice President, Finance, CFO, Raute Corporation, mobile phone +358 40 658 3562

DISTRIBUTION:

Nasdaq Helsinki Ltd, main media, www.raute.com

RAUTE IN BRIEF:

Raute is a technology and service company that operates worldwide. Raute's customers are companies operating in the wood products industry that manufacture veneer, plywood, LVL (Laminated Veneer Lumber) and sawn timber. Its technology offering covers the entire production process for veneer, plywood and LVL and special measurement equipment for sawn timber. As a supplier of mill-scale projects, Raute is a global market leader both in the plywood and LVL industries. Additionally, Raute's full-service concept includes technology services ranging from spare parts deliveries to regular maintenance and equipment modernizations. Raute's head office is located in Lahti, Finland. The company's other production plants are located in Kajaani, Finland, the Vancouver area of Canada, the Shanghai/Changzhou area of China and in Pullman, Washington, USA. Raute's net sales in 2021 were EUR 142.2 million. The Group's headcount at the end of 2021 was 802. More information about the company can be found at www.raute.com.

Source: Cision
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