Vaahto Group Interim Management Statement for 1 September 2011-29 June 2012
VAAHTO GROUP PLC OYJ STOCK EXCHANGE RELEASE 29.6.2012 at 14.00
VAAHTO GROUP INTERIM MANAGEMENT STATEMENT FOR 1 SEPTEMBER 2011–29 JUNE 2012
The turnover of Vaahto Group for 1 September 2011–31 May 2012 was 38.6 MEUR (compared with 40.4 MEUR for the corresponding period in the previous financial year), with an operating loss of 4.4 MEUR (compared with an operating loss of 0.6 MEUR). The turnover fell by 4.5% from the reference period level, causing the operating result to remain markedly weaker than in the reference period. The Group’s order book amounted to 17.9 MEUR on 31 May 2012, whereas it was 22.4 MEUR at the start of the period under review on 1 September 2011.
Vaahto Group Plc Oyj’s extraordinary general meeting on 19 June 2012 appointed Sami Alatalo as a new Board member. The general meeting also approved an amendment to the statutes, based on which the company’s normal financial year was changed to 1 January–31 December. Consequently, the duration of the current financial year will be sixteen (16) months (1 September 2011–31 December 2012).
Vaahto Paper Technology
The turnover of the Vaahto Paper Technology division for 1 September 2011–31 May 2012 was 24.7 MEUR (28.8 MEUR), and its operating loss was 3.5 MEUR (operating profit 0.4 MEUR). The turnover fell by 14.5% from the reference period level, causing the result to remain weaker than that of the reference period. The main reason for the Vaahto Paper Technology division’s loss-making result was the weak profitability of the projects that were entered as income for the period under review.
In the period under review, the most significant new order in the project business was the modernisation of the pulp dryer at the Södra Cell Mönsterås pulp mill. There have been clear signs that the market situation of the project business is becoming more intense. The market situation of the service business has continued to be fairly good for the time being.
In the period under review, the organisation and business structure of the Vaahto Paper Technology division was clarified. Measures were taken to strengthen particularly the sales and product development operations, while cost-effectiveness was improved by combining overlapping operations.
The company has made strategic definitions to focus on the service business in the Vaahto Paper Technology division, with a goal of becoming a strong Nordic service organisation. A new intensification programme has been started in the service business, the effects of which are expected to be seen in the final months of the extended financial year.
Vaahto Process Technology
The turnover of the Vaahto Process Technology division for 1 September 2011–31 May 2012 was 14.0 MEUR (11.6 MEUR), and its operating loss was 0.9 MEUR (operating loss 1.0 MEUR). The turnover increased by 20.9% compared to the reference period, and the result was slightly better than that of the reference period. The result was weakened by the low profitability of the delivery projects in the vessel business during the period under review.
The market situation of the Vaahto Process Technology division has remained fairly good and the division’s order book grew during the period under review. The division’s agitator business is seen as one of the Group’s strategic areas of focus.
Directed share issue and share exchange agreement
The company’s Board of Directors decided on 19 April 2012 to issue 600,000 new shares and to deviate from the shareholders’ subscription privilege, issuing the shares to a group of selected investors instead. Based on the discussions with the investors, the subscription price was agreed at 3.50 EUR per share, thus the total subscription price amounted to 2,100,000 EUR.
The company’s Board also decided to approve a share exchange agreement, which was signed on 19 April 2012, concerning the company’s subsidiary AP-Tela Oy, as well as a directed share issue based on the agreement in order to carry out a share exchange for the minority shareholders of AP-Tela Oy. Following the share exchange, the Group’s share in AP-Tela Oy is 100%.
Estimate for the financial year 1 September 2011–31 December 2012
There have been worrying trends in the development of the international financial situation and the market situation of Vaahto Group’s main branches of industry has continued on its difficult course. The operating result of Vaahto Group’s extended financial year is estimated to be loss-making and weaker than what was previously forecast for the twelve (12) month financial year. In order to secure the company’s financial position, discussions are underway to arrange long-term financing. In order to revive the Group, the Board is also reviewing opportunities to make structural arrangements. Due to a market situation that is difficult to predict, there remains significant uncertainty over the estimation of the result for the financial year.
Interim report for 1 September 2011–31 August 2012
The extraordinary general meeting of Vaahto Group Plc Oyj on 19 June 2012 decided that the company’s normal financial year would be changed to 1 January–31 December. The company’s current financial year 1 September 2011–31 August 2012 is therefore extended to sixteen (16) months, ending on 31 December 2012. Vaahto Group will release its interim report for twelve months on 10 October 2012.
Lahti, 29 June 2012
VAAHTO GROUP PLC OYJ
The Board of Directors
Acting CEO, Vaahto Group Plc Oyj
tel. +358 400 127664
Vaahto Group is a globally operating high technology company serving process industry in the fields of pulp and paper machinery and process machinery.