Annual General Meeting 2011

Transcription

1 Annual General Meeting 2011 Sibelius Hall, Lahti 13 April 2011 Tapani Kiiski, President and CEO

2 A year of slow recovery and adaptation Raute s business environment Strategy Financial statements Raute as an investment

3 Raute as a part of the wood-processing value chain Raute generates added value for its customers businesses by supplying solutions to facilitate profitable and environmentally sustainable production of wood products. Raute s customers Veneer industry Plywood industry LVL industry Decorative veneer industry Veneer, plywood and LVL are used mainly in construction and furniture as well as in the transport vehicle and packaging industries. Raute s solutions 3 Project deliveries: Mill-scale projects, separate production lines, machinery and equipment Automation, machine vision, measuring technology Technology services: Consultation and business support services Maintenance and spare parts Modernizations

4 Business environment Demand for wood products is driven by General increasing standard of living Construction regulations Availability and price of wood Economic cycles Wood products industry From large consolidated forest groups to small private family businesses New mills tend to be larger than the traditional ones Internationalization and integration not very far New companies are entices to the industry by to harvesting height grown forest resources Emerging markets to play a greater role Raute s competitors are typically small or medium-sized companies operating locally or regionally focusing on only one or a few processes Challenges and opportunities of wood products industry Cost-efficient and ecological production methods Increasing use of plantation trees Quality requirements and standardization of end products 4

5 Changes as opportunities Europe Developing current capacity Africa Local further processing of wood Russia Upgrading production technology Exploiting forest resources Export products Trends Renewable wood as raw material on rise Higher environmental awareness and tightening regulations More cost-efficient manufacturing methods necessary to face tightening competition Energy prices up Emerging markets to play a greater role Asia-Pacific area Plantation forest resources In China, increased quality requirements and industrialization South America Plantation forest resources Modernization North America Replacement investments, when economy recovers From Raute s perspective Increasing use of wood boosts for demand for wood proucts technology Emerging markets to play a greater role Raute must identify individual customer needs and be able to offer, in addition to state-of-the-art technology, solutions where automation is not a decisive factor creating a competitive edge. Share of technology services, especially in traditional markets, to increase 5

6 Market started to recover Business environment: World economy recovered clearly from the previous year Demand for plywood, veneer and LVL picked up from the previous year, but remained at a lower level than before the recession: In Asia and Russia, production returned to the pre-recession level In South America, production did not even decrease during the recession In Europe, situation improved towards the year-end In North America, demand and production remained at a very low level Availability and terms of financing still a challenge Investments for new capacity were few Raute: Recovery from recession started Order intake, 72 MEUR, at a good level considering the market situation Three significant orders to the Asia- Pacific region - two of them for LVL production lines Towards the end of the year, demand for small and medium-sized projects strengthened 6

7 Strategy Customer industries Raute offers services to the following customer industries: Veneer and plywood industry LVL (Laminated Veneer Lumber) industry Decorative veneer industry Mission and business definition Raute generates added value for its customers businesses by supplying solutions to facilitate profitable and environmentally sustainable production of wood products. Values Customer focus Trust in people Continuous development The environment 7

8 Strategy The preferred solution provider with attractive offerings to meet different customer segment needs globally Adaptation to cyclical economic fluctutation The trusted local life cycle partner for production process optimization Growth Among three leading suppliers in selected emerging markets through targeted product range Profitability Profitable solutions for all customer needs Cost-efficient and agile processes with good quality across the global network Preferred company for competent people to achieve together 8

9 Examples on implementing the reviewed strategy Strategy of three product families RautePro For the emerging markets Simple, reliable Easy to use and maintain Profitable investment/capacity RauteSelect For flexible production; products, wood species, etc. Middle-stage capacity and automation RauteSmart Smartest and most efficient state-ofthe-art technology Highest capacity and automation level 9

10 Examples on implementing the reviewed strategy RautePro XY Charger Fully electrical positioner Designed to fit in lathes delivered both by Raute and by Raute s competitors Market potential in Asia, Russia and Southern Europe 10

11 Examples on implementing the reviewed strategy RautePro TwinPeel peeling station Five integrated functions Centering Debarking Round-up Peeling Clipping Targeted especially to the Chinese market, however, potential also in Southeast Asia Launched in the Shanghai exhibition in March

12 Financial statements 2010

13 Year 2010 in brief MEUR Net sales Operating profit New orders: Project deliveries Technology services Order book Net sales increased clearly, 72% Adaptation measures continued causing 1.2 MEUR costs In Finland, production personnel concentrated in Nastola and personnel adaptation measures In North America, move to new facilities Profitability improved; operating result was, however, negative Income before taxes was positive 4.4 MEUR gain from real estate sale in Canada Continued investments in product development and personnel 13

14 Year 2010 New orders Net sales South America 3 % Russia 7 % Europe 25 % Technlogy services 31 % North America 12 % Asia-Pacific 53 % Project deliveries 69 % 14

15 New orders MEUR Q1 Q2 Q3 Q

16 Net sales MEUR Q1 Q2 Q3 Q

17 Order book MEUR Q1 Q2 Q3 Q

18 Operating profit MEUR ,0 5,0 0, ,0-10,0-15,0 18

19 Investing in the future MEUR Capital expenditure Capital expenditure of net sales, % R&D expenditure R&D costs R&D expenditure of net sales, % 8,0 8 % 7,0 7 % 6,0 6 % 5,0 5 % 4,0 4 % 3,0 3 % 2,0 2 % 1,0 1 % 0, % 19

20 Personnel 700 Personnel, average Effective, average

21 Local presence globally Finland: Nastola, Kajaani, Jyväskylä 360 persons, 73.8% Russia: Moscow, St. Petersburg 6 persons North America: Vancouver, Memphis 68 persons, 13.9% China: Shanghai 45 persons, 9.2% Singapore 5 persons Chile: Santiago 4 persons Raute Agent

22 Income statement and key figures MEUR Net sales Operating profit Financial income and expenses Profit before taxes Income taxes Profit for the period Earnings per share, EUR Operating cash flow Return on investment (ROI), % Gearing, % Equity ratio, % Personnel (in books)

23 Balance sheet MEUR Intangible assets Tangible assets Other non-current assets Inventories Accounts receivables and other receivables Cash and cash equivalents Total assets Equity Non-current liabilities Advance payments received Current liabilities Total equity and liabilities

24 Business environment: Uncertainty related to the permanent recovery of the world economy and financial markets still continues prospects for growth, however, particularly in the emerging markets No certainty of wood products demand reaching the pre-recession level on a permanent basis yet Upgrade investments in the plywood industry to ensure quality and maintain market shares are likely to increase Single mill-scale investment projects are being planned in several market areas implementation and timing uncertain Raute: Outlook for 2011 Market will continue to improve, albeit slowly New projects to increase capacity will be launched in several market areas Cost structure lighter thanks to adaptation measures taken. Business is more profitable than before, even in a difficult market situation Net sales for 2011 will increase from the previous year. The operating result is expected to be positive 24

25 Raute as an investment

26 Higher shareholder value Clearly defined strategy and regular review of it Reaction and adaptation to changing market conditions Solid and long-term ownership Impeccable corporate governance and communication Predictability Stock exchange quotation Long-term dividend policy 26

27 Shareholders Development of the number of shareholders Management 7 % Ownership, Dec. 31, 2010 Companies 4 % Institutions 8 % Foreign 2 % Nomineeregistered 2 % Households 77 %

28 Market value Market value, MEUR 70 Share price, EUR 16,0 14,35 Closing price at Dec. 31 Average price 60 57,5 14,0 12, ,5 12, ,6 29,9 38,8 10,0 8,0 6,0 6,40 7,47 9, ,0 10 2, , Series K shares appreciated to the value of series A shares. 28

29 Earnings per share EUR 2,00 1,50 1,00 0,50 0,00-0,50-1,00-1,50-2,00-2,50 Earnings per share Dividend *) 29 *) Board of Directors proposal to the AGM on 13 April 2011.

30 Thank you for your interest!