Vaahto Group Interim Management Statement for September 1, 2009 – July 2, 2010
VAAHTO GROUP PLC OYJ STOCK EXCHANGE RELEASE 2.7.2010 at 9.30
VAAHTO GROUP INTERIM MANAGEMENT STATEMENT FOR SEPTEMBER 1, 2009 – JULY 2, 2010
Vaahto Group’s turnover for September 1, 2009, to May 31, 2010, was 26.2 million euros (compared with 56.6 million euros for the corresponding period in the previous fiscal year), with an operating loss of 5.7 million euros (comparative: operating loss of 2.9 million euros). The turnover saw a decrease of 54% from that of the reference period, undermining the result. Vaahto Group’s order book started increasing in the third quarter of the fiscal year, to total 13.0 million euros at its end.
Pulp & Paper Machinery
The Pulp & Paper Machinery division’s turnover for September 1, 2009, to May 31, 2010, was 16.7 million euros (37.2 million euros), with an operating loss of 5.2 million euros (operating loss of 3.4 million euros). The turnover decreased by 55% from that of the reference period, and the division’s result was unprofitable.
The market situation for the Pulp & Paper Machinery division’s Projects unit has perked up significantly. In the third quarter, the division received an order for four headboxes from the Chinese Taishan Gypsum Co. Ltd. After the end of the period under review, the division received a significant shoe press order from Indonesia.
The Pulp & Paper Machinery division’s most significant delivery project during the period was the tissue-paper machine rebuild for Metsä Tissue in Mänttä. In spite of the tight schedule, the project was completed sooner than planned, and the rebuilt machine entered production use in April. The delivery included a new crescent former, headbox, and reel as well as a rebuilt short-circulation system and press. The modernization has increased the efficiency of the production line, thanks to the better runnability of the paper machine and refining lines as well as the increased running speed.
The market situation has clearly improved for the Pulp & Paper Machinery division’s Vaahto Service unit, and its order book continued to increase in the third quarter. Vaahto Service’s product selection for paper machine servicing has expanded in line with objectives, contributing to the significant increase in the order book recently. Consequently, the Service unit’s operations were profitable in the third quarter.
The Process Machinery division’s turnover for September 1, 2009, to May 31, 2010, was 9.6 million euros (20.4 million euros), with an operating loss of 0.6 million euros (operating profit of 0.6 million euros). The turnover decreased by 53% from that of the reference period, and the division’s result was slightly unprofitable.
The Process Machinery division’s market situation has remained challenging, although slight improvement was detected during the period under review. In the tank business, the number of projects in the offer phase has been on the significant increase, but decisions on the realization of these projects have been subject to heavy delays in view of the current economic climate. For the agitator business, market prospects are moderate, and the order book kept increasing slightly in the third quarter of the fiscal year.
Outlook for the September 1, 2009 – August 31, 2010, fiscal year
The international market situation has remained fairly weak, although significant improvement has been detected lately. During the period under review, Vaahto Group took extensive measures to improve its competitiveness, and these measures, along with the improved market situation, have resulted in growth in the Group’s order book.
Vaahto Group’s order book decreased significantly in the previous fiscal year, and the starting point for the current fiscal year therefore was highly challenging. In spite of the cost-adjustment procedures performed, the fiscal year has shown a negative result so far. Although the Group’s profitability is expected to increase toward the end of the fiscal year, the full-year result will still be clearly negative.
Lahti, July 2, 2010
VAAHTO GROUP PLC OYJ
Board of Directors
For more information, please contact:
CEO, Vaahto Group Plc Oyj
Tel.: +358 50 466 1470