Fourth Quarter 2015
-
Revenue for Period: SEK
17.2 million (SEK 15.6 million)
-
Operating Result: SEK 4.4
million (SEK 3.5 million)
-
Earnings per Share from
Operations: SEK 0.6 per share (SEK 0.5 per share)
-
Earnings per Share: SEK 1.3
per share (SEK 0.5 per share)
-
Cashflow from Operations:
SEK 4.6 million (SEK 3.2 million)
-
Ram EcoDiesel captures third consecutive
Wards 10 Best Engine award
-
First CGI aviation engine begins FAA approval
process in United States
Full Year 2015
-
Revenue for Period: SEK
72.4 million (SEK 54.5 million)
-
Operating Result: SEK 20.3
million (SEK 10.2 million)
-
Earnings per Share from
Operations: SEK 2.9 per share (SEK 1.4 per share)
-
Earnings per Share: SEK 3.6
per share (SEK 1.7 per share)
-
Cashflow from Operations:
SEK 20.4 million (SEK 6.7 million)
-
Dividend: Proposed ordinary
dividend of SEK 2.0 per share (SEK 1.5 per share) plus an
extraordinary dividend of SEK 1.5 per share (SEK 0.7 per
share)
-
Six installation commitments equals record for
new installations
-
Installed Base: 24 fully
automated systems and 20 mini-systems in Europe, Asia and the
Americas
Series
Production*
For graph, please see Press Release PDF
Annualised series
production increased to 2.1 million Engine Equivalents in the
fourth quarter, despite lower shipments in December due to year-end
shutdowns.
* Annualised average production of Engine
Equivalents during the quarter (1 Engine Equivalent = 50 kg)
CEO Comments Record results
in all operational areas
The progress of 2015 provided
record results in all of SinterCast's key metrics. Full year
series production finished at the record level 2.1 million Engine
Equivalents, providing 18% growth compared to 2014. The
increased series production also led toward record Sampling Cup
shipments of 152,700, representing an increase of 15% above the
previous record established in 2014. Beyond series
production, the growing awareness and demand for CGI resulted in
new installation commitments in Europe, Asia and the
Americas. Six new installation commitments were secured,
equalling the previous one-year high. Combined with
favourable exchange rates, the improvements in production, Sampling
Cups and installations resulted in record revenue of SEK 72.4
million and almost 100% increase in the full year operating
result.
Series production was primarily
buoyed by strong growth in passenger vehicle applications,
benefitting from the ramp up of the Ford petrol engine and from
continued strong sales of the 3.0 litre V6 diesel engines for Audi,
FCA and Ford. The outlook for passenger vehicles remains
positive with new vehicle applications being announced for the Ford
petrol engine and with the start of sales of the 5.0 litre V8
diesel in the all-new Nissan Titan pick up in the US. The
Nissan Titan is exclusively available with the SinterCast-CGI
diesel engine, so all sales provide incremental growth. The
Ram 1500 continues to be the flagship for SinterCast's promotion of
diesel engines in the important US pick up market. With the
best fuel economy rating in the full size light duty pick-up
sector, the 3.0 litre V6 diesel engine won a third consecutive
Wards 10 Best Engines award. The CGI
diesel was the only winner to receive a third consecutive award;
one of only two repeat winners; and, was the only diesel among the
ten winning engines. The success of the Ram diesel has
validated SinterCast's longstanding belief in diesel engines in
pick up applications and has established a competitive benchmark in
the segment.
Beyond passenger vehicles, the
production of cylinder blocks and heads for commercial vehicle
applications and of components for industrial power applications
also increased during 2015. While the industrial power sector
is primarily regarded as large off-road components for
agricultural, construction, marine, locomotive and stationary power
applications, a new application was announced during the fourth
quarter. Engineered Propulsion Systems (EPS) announced that
it has specified Compacted Graphite Iron (CGI) for the cylinder
block of its new aviation diesel engine. Currently undergoing
Federal Aviation Authority (FAA) approvals in the United States,
the use of CGI enabled EPS to engineer a clean sheet Aviation
Diesel engine that is setting new standards in weight, size,
reliability, and most importantly, fuel consumption. Initial
testing of the pre-production engine has demonstrated specific
power of 105 horsepower per litre (77 kw/l), resulting in an output
of 450 horsepower (332 kW). The installed wet weight of the
450 horsepower diesel engine package is within 45 pounds (20 kg) of
alternative 350 horsepower (257 kW) air-cooled turbocharged engines
currently used in aero applications.
Installation Commitments in Europe, Asia and the
Americas
Building on the increased
awareness and demand for CGI, 2015 was a strong year for new
installation commitments, with two installations commissioned in
China, one in Japan, one in Korea, one in Portugal and a year-end
order for a System 3000 Plus installation at
the Teksid foundry in Brazil. The Teksid do Brasil
installation is planned to be commissioned during the second
quarter of 2016. All of the other 2015 installations have
been successfully commissioned and product development is
proceeding according to schedule.
New product development
SinterCast is continuously
investigating new concepts and developing new technologies.
At present, SinterCast is developing the application of its thermal
analysis know-how to the control of ductile iron production,
including the development of a bespoke ductile iron thermal
analysis sampling device and the optimisation of metallurgical
correlations. SinterCast is also developing other
technologies - within and beyond the scope of thermal analysis - to
improve quality and production efficiency in the cast iron foundry
industry.
Financial Summary
Revenue
The revenue for the SinterCast
Group relates primarily to income from equipment, series production
and engineering service.
Revenue Breakdown |
October-December |
January-December |
(Amounts in SEK million if not otherwise stated) |
2015 |
2014 |
2015 |
2014 |
Number of Sampling Cups shipped |
40,700 |
38,200 |
152,700 |
133,000 |
Equipment 1 |
0.4 |
1.1 |
7.7 |
4.9 |
Series Production 2 |
16.6 |
13.9 |
63.6 |
47.8 |
Engineering Service 3 |
0.2 |
0.3 |
1.0 |
1.4 |
Other |
0.0 |
0.3 |
0.1 |
0.4 |
Total |
17.2 |
15.6 |
72.4 |
54.5 |
|
|
|
|
|
Notes: |
1. |
Includes revenue from system sales and leases and sales of
spare parts |
|
|
2. |
Includes revenue from production fees, consumables and
software licence fees |
|
|
3. |
Includes revenue from technical support, on-site trials and
sales of test pieces |
|
The October-December 2015 revenue amounted to SEK 17.2
million (SEK 15.6 million). Revenue from series production
increased by 19% to SEK 16.6 million (SEK 13.9 million), due to
increased annualised production of approximately 2.1 million (1.85
million) Engine Equivalents, the increased shipment of 40,700
(38,200) Sampling Cups and favourable exchange rates. Equipment
revenue amounted to SEK 0.4 million (SEK 1.1 million) following the
sale of equipment to an existing European customer to increase
production capacity. Engineering Service amounted to SEK 0.2
million (SEK 0.3 million) following support provided to various
customers globally and the sale of test pieces.
The January-December 2015 revenue amounted to SEK 72.4 million, surpassing
the full year revenue record of SEK 54.5 million established in
2014. The revenue from series production increased by 33% to SEK
63.6 million (SEK 47.8 million) due to an 18% increase in the
full-year series production, a 15% increase in Sampling Cup
shipments, and favourable exchange rates. Equipment revenue
amounted to SEK 7.7 million (SEK 4.9 million), primarily derived
from Mini-System 3000 installations at Doosan Infracore in Korea,
at an undisclosed foundry in Japan, at Dongfeng in China, at Teksid
in Portugal, and the System 3000 Plus
installation at Asimco in China. Engineering Service amounted to
SEK 1.0 million (SEK 1.4 million). The revenue from the leased
installations is accrued over the lease period.
Results
The business activities of
SinterCast are best reflected by the Operating Result. This is
because the "Result for the period after tax" and the "Earnings per
Share" are influenced by the financial income and costs and by the
revaluation of tax assets.
Results Summary |
October-December |
January-December |
(Amounts in SEK million if not otherwise stated) |
2015 |
2014 |
2015 |
2014 |
Operating Result |
4.4 |
3.5 |
20.3 |
10.2 |
Result for the period after
tax* |
9.0 |
3.7 |
25.2 |
12.3 |
Earnings per Share (SEK), from
operations |
0.6 |
0.5 |
2.9 |
1.4 |
Earnings per Share (SEK)* |
1.3 |
0.5 |
3.6 |
1.7 |
*During the
fourth quarter, the parent company settled its debts toward its
subsidiaries in US and UK. To minimise cashflow effects, the
settlement was made by offsetting receivables against repayment of
equity and shareholder contribution. The parent company has
reversed previous impairment losses related to these investments.
The reversal, including accumulated translation differences related
to these holdings, is disclosed in the income statement as
financial income (SEK 15.3 million). The reversed accumulated
translation differences have been reclassified from other
comprehensive income (SEK -4.5 million) to financial income in the
income statement for the Group (SEK +4.5 million).
The October-December 2015 operating result of
SEK 4.4 million (SEK 3.5 million) increased as a result of higher
gross results of SEK 1.4 million primarily derived from higher
revenue, combined with higher operational expenses of SEK 0.5
million. The result for the period after tax amounted to SEK 9.0
million (SEK 3.7 million). The increase of SEK 5.3 million is
primarily related to the parent company's settlement of debts
toward its subsidiaries in US and UK. The net effect of the
settlement relates to translation gains that have been accounted
for as financial income amounting to SEK +4.5 million. This
non-cashflow effect is a one-time, non-recurring item. The
remaining increase of SEK 0.8 million is primarily related to the
increased operating result of SEK 0.9 million and the increased tax
expense of SEK 0.1 million.
The January-December 2015 operating result of SEK 20.3
million (SEK 10.2 million), increased as a result of higher gross
results of SEK 14.6 million, primarily derived from higher revenue,
combined with higher operational expenses of SEK 2.8 million and
decreased operating income (exchange losses) of SEK 1.7 million.
The result for the period after tax amounted to SEK 25.2 million
(SEK 12.3 million) The operational increase is SEK 8.4 million and
relates primarily to the increased operating result of SEK 10.1
million and a SEK 1.7 million decrease in the financial net
(primarily exchange losses). The remaining increase of SEK 4.5
million relates to the parent company's settlement of debts toward
against its subsidiaries in US and UK.
Deferred Tax Asset
Tax for the period
January-December 2015 amounted to SEK 0.8 million (SEK 0.9
million). The estimated future taxable profit and deferred tax
asset calculation is reassessed every quarter. As of 31 December
2015, SEK 137.8 million (SEK 133.3 million) of SinterCast's total
carried-forward tax losses have been used as the basis of the
updated calculation, resulting in SEK 30.3 million (SEK 29.3
million) being capitalised as a deferred tax asset.
Cashflow, Liquidity and Investments
Cashflow Summary Full Year |
January-December |
Cashflow
Changes |
(Amounts in SEK million if not otherwise stated) |
2015 |
2014 |
2015 vs. 2014 |
Cashflow from operations, before change in working
capital |
21.3 |
10.9 |
|
10.4 |
Change in working capital |
-0.9 |
-4.2 |
|
3.3 |
Cashflow from operations |
20.4 |
6.7 |
|
13.7 |
Cashflow from investing activities
Cashflow from financing activities |
-1.7
-15.6 |
-1.3
-8.5 |
|
-0.4
-7.1 |
Exchange rate differences in cash and cash
equivalents |
0.0 |
0.2 |
|
-0.2 |
Cashflow total |
3.1 |
-2.9 |
|
6.0 |
Liquidity |
48.0 |
44.9 |
|
|
|
The January-December 2015 cashflow from operations
increased three-fold, by SEK 13.7 million, compared to the same
period in 2014, primarily due to an increase of SEK 10.4 million in
cashflow from operations before changes in working capital, plus
changes in working capital (SEK 3.3 million), derived from changed
cashflow from inventory (SEK -1.3 million), receivables (SEK -1.5
million) and operating liabilities (SEK 6.1 million).
The total cashflow increased by
SEK 6.0 million after increased investments in the amount of SEK
0.4 million, primarily related to increased activation of products
under development (SEK 0.6 million) and decreased patent
investments (SEK 0.2 million). Total investments amounted to
SEK 1.7 million. Following the dividend of SEK 15.6 million (SEK
8.5 million), the total cashflow amounted to SEK 3.1 million (SEK
-2.9 million). Liquidity on 31 December 2015 was SEK 48.0 million
(SEK 44.9 million). SinterCast has no loans.
Risks and Uncertainty Factors
The main uncertainty factor for
SinterCast continues to be the timing of the CGI market
ramp-up. This primarily depends on OEM decisions for new CGI
engines and other components, the global economy for new vehicle
sales, and the individual sales success of vehicles equipped with
SinterCast-CGI components.
The economies have developed
differently in Europe, Asia and the Americas over the last several
years. The European passenger vehicle, commercial vehicle,
and construction equipment markets have begun to show some
recovery, but this growth is from a relatively low level and
uncertainty remains in the market. In Asia, the dominant
Chinese market is characterised by overcapacity in the commercial
vehicle and construction equipment sectors, which represent the
primary opportunity for CGI. This overcapacity, coupled with
the current economic uncertainty in China, influences product
development cycles and production volumes. In contrast, consumer
confidence has increased in North America and SinterCast has
benefitted from increased vehicle sales. SinterCast's geographical
diversification helps to mitigate changing macroeconomic conditions
in the different regions. However, as manufacturing continues
to grow in developing countries, many of the future installation
opportunities will be in price sensitive markets and this can
present a challenge for the SinterCast fee structure and Business
Model.
For full risk and uncertainty factor information,
see Note 26 on pages 46 and 47 in SinterCast's Annual Report
2015
Organisation
With successful high volume CGI
production in foundries located in Europe, Asia and the Americas,
SinterCast has established a global organisation with employees and
offices in Sweden, the United Kingdom, the United States, China and
Korea. As of 31 December 2015, the Group had 20 (19)
employees, four (four) of whom are female. The company is well
positioned to support global market activities and to drive
SinterCast's future growth.
Parent Company
SinterCast AB (publ) is the Parent
Company of the SinterCast Group, with its registered office located
in Stockholm, Sweden. On 31 December 2015, the Parent Company had
15 (14) employees. The majority of the operations are managed by
the Parent Company while local operations in the United Kingdom,
United States, Korea and China are managed by the local companies.
The information given for the Group in this report corresponds in
all material respects to the Parent Company. However, the result
for the period may differ between the Group and the Parent Company
due to intercompany transactions between the Parent Company and its
subsidiaries.
Patents
SinterCast currently holds 12 (12)
patents, granted or pending, and maintains 69 (59) individual
national phase patents worldwide. These patents address
SinterCast's metallurgical technology, thermal analysis, the
Sampling Cup for CGI and ductile iron, product applications and
machining.
Accounting Principles
The information provided on behalf
of the Group in this interim report has been prepared in accordance
with Sweden's Annual Accounts Act and IAS 34 Interim Financial
Reporting. The reporting for the Parent Company has been prepared
in accordance with Sweden's Annual Accounts Act and RFR 2. The
accounting policies that have been applied for the Group and the
Parent Company are in agreement with the accounting policies used
in the preparation of the company's latest Annual Report. The
implementation date of IFRS 15 has been changed from 1 January 2017
to 1 January 2018. IFRS 16 Leases. In January 2016, IASB issued a
new lease standard that will replace IAS 17 Leases and the related
interpretations IFRIC 4, SIC-15 and SIC-27. The standard requires
assets and liabilities arising from all leases, with some
exceptions, to be recognized on the balance sheet. This model
reflects that, at the start of a lease, the lessee obtains the
right to use an asset for a period of time and has an obligation to
pay for that right. The accounting for lessors will in all material
aspects be unchanged. The standard is effective for annual periods
beginning on or after 1 January 2019. Early adoption is permitted.
EU has not yet adopted the standard. The group has not yet assessed
the impact of IFRS 16.
No material transactions have
taken place between SinterCast and the Board or the Management
during the period.
Events after the Balance Sheet Date
There have been no significant events since the
balance sheet date of 31 December 2015 that could materially change
these financial statements. The following press releases have been
issued:
13 January 2016 - Recognition for SinterCast at North American
International Auto Show
Nomination Committee
The Nomination Committee, elected
by the Annual General Meeting 2015, consists of Karl-Arne
Henriksson, Chairman, Hans-Erik Andersson, Chairman of the Board of
Directors, Ulla-Britt Fräjdin-Hellqvist and Andrea Fessler.
Shareholders wishing to provide input or proposals should provide
written submissions to the Nomination Committee (e-mail:
nomination.committee@sintercast.com) before 25 March 2016.
Annual General Meeting 2016
The Annual General Meeting 2016 of
SinterCast AB (publ) will be held on Thursday 19 May 2016.
Shareholders wishing to have a
matter considered at the Annual General Meeting should provide
written submissions to agm.registration@sintercast.com or to the
company: SinterCast AB (publ), P.O. Box 10203, SE-100 55 Stockholm,
Sweden, at least seven weeks prior to the Annual General Meeting
for the proposal to be included in the notice of the meeting.
Further details on how and when to register will be published in
advance of the Annual General Meeting.
Dividend 2015
The Annual General Meeting of
SinterCast AB (publ) held on 20 May 2015 approved an ordinary
dividend for 2015 amounting to SEK 1.5 (1.2) per share and an
extraordinary dividend amounting to SEK 0.7 (0.0) per share. A
total amount of SEK 15.6 (8.5) million was transferred to the
shareholders.
Proposed Dividend
2016
The Board's intention is to continue to provide an ordinary
dividend to the shareholders, based primarily on the cashflow from
operations. In the event that the Board considers that the
liquidity exceeds the amount needed to support the operational
requirements and strategic objectives, the Board has the option to
propose an extraordinary dividend or a share buy-back to further
adjust the liquidity.
The Board of Directors
propose an ordinary dividend of SEK 2.0 per share (SEK 1.5) plus an
extraordinary dividend of SEK 1.5 (0.7) per share, representing a
transfer of SEK 24.8 million (SEK 15.6 million) to the shareholders
of SinterCast AB (publ). The Board proposes 23 May 2016 as the
record date for entitlement to receive dividends. In deciding the
amount of the ordinary dividend to be proposed to the AGM 2016, the
Board considered cashflow from operations, the financial position,
investment requirements and other factors, such as market outlook,
growth strategy and the internal financial forecast for the
Group.
The Annual Report 2015
The Annual Report 2015 will be
published on 7 April 2016.
Information
The Interim Report January-March
2016 will be published on 27 April 2016
The Interim Report April-June 2016 will be published on 24 August
2016
The Interim Report July-September 2016 will be published on 16
November 2016
The Interim Report October-December and Full Year Results 2016 will
be published on 22 February 2017
This report has not been reviewed by the company's
Auditors.
Stockholm 17
February 2016
For further information please
contact:
Dr. Steve Dawson |
President &
CEO |
SinterCast AB
(publ) |
Office: |
+46 8 660 7750 |
Mobile: |
+44 771 002 6342 |
e-mail: |
steve.dawson@sintercast.com |
website: |
www.sintercast.com |
SinterCast is
the world's leading supplier of process control technology for the
reliable high volume production of Compacted Graphite Iron (CGI).
With at least 75% higher tensile strength, 45% higher stiffness and
approximately double the fatigue strength of conventional grey cast
iron and aluminium, CGI allows engine designers to improve
performance, fuel economy and durability while reducing engine
size, weight, noise and emissions. The SinterCast technology, with
44 installations in 13 countries, is primarily used for the
production of petrol and diesel engine cylinder blocks and exhaust
components for passenger vehicles, medium-duty and heavy-duty
cylinder blocks and heads for commercial vehicles, and industrial
power engine components for marine, rail, off-road and stationary
engine applications. SinterCast's series production components
range from 2 kg to 9 tonnes, all using the same proven process
control technology. The SinterCast share is quoted on the
Small Cap segment of the Stockholm NASDAQ OMX stock exchange
(Stockholmsbörsen: SINT). For more information:
www.sintercast.com
END
Press Release PDF
This
announcement is distributed by NASDAQ OMX Corporate Solutions on
behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: SinterCast via Globenewswire
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