Componenta Oyj — Interim / Quarterly Report 2014

Apr 25, 2014

I N T E R I M R E P O R T 1 J a n u a r y - 31 March 2014

Q 1

C O M P O N E N TA C O R P O R AT I O N I N T E R I M R E P O R T

Net sales increased and operating profit improved from previous year

Q1 in brief

• • Order book at the end of the review period was 2% higher than in the previous year, MEUR 91 (MEUR 89).
• • Net sales in the review period increased 3% from the previous year to MEUR 132 (MEUR 128).
• • EBITDA excluding one-time items improved from the previous year to MEUR 12.1 (MEUR 8.2).
• • Operating profit excluding one-time items improved from the previous year to MEUR 7.4 (MEUR 3.8). The improvement in the operating profit from the previous year is mainly due to the cost savings achieved in the efficiency improvement program.
• • The result after financial items excluding one-time items was MEUR -0.1 (MEUR -2.2).
• • One-time items totalled MEUR -0.9 (MEUR -0.5).
• • Earnings per share excluding one-time items were EUR -0.06 (EUR -0.09) and after one-time items EUR -0.09 (EUR -0.11).

Efficiency improvement program

Componenta's group-wide efficiency improvement program has continued to make progress in accordance with expectations during the first quarter of 2014. The program has the target of improving the Group's profitability by EUR 25 million by the end of 2014 and by a further EUR 10 million by the end of 2015.

The combined impact of the development projects and measures carried out so far in the efficiency improvement program should give an estimated run rate improvement of EUR 29 million in EBITDA.

The program to improve productivity and quality in Orhangazi, Turkey made progress as planned during the first quarter. The measures carried out at the foundry by the end of the review period will bring a run rate improvement of EUR 9.0 million in EBITDA.

The measures expanding the program to improve productivity and quality at the production units in the Netherlands are continuing until the end of 2014. Some of the cost savings will be achieved during 2014 and the goal is to achieve the full savings in 2015. The measures carried out by the end of the review period will bring a run rate improvement of EUR 5.3 million in EBITDA.

As earlier has been decided, the machining operations for long series at the Främmestad machine shop in Sweden are being concentrated to the Orhangazi machine shop in Turkey. Implementation of the transfer of long series products is running somewhat behind its original schedule mainly due to high capacity utilization rate of the Orhangazi machine shop. The measures carried out by the end of the review period will bring a run rate improvement of EUR 0.9 million in EBITDA.

Closing down the large Disa production line at the Pietarsaari foundry has proceeded according to plan and the related product transfers to the foundries in Orhangazi, Turkey and Pori, Finland have been completed. Totally closing down the Pietarsaari foundry and the related transfer of the small Disa production line to the Pori foundry have progressed according to plan. The Pietarsaari foundry will close down in the summer of 2014 and the resulting EUR 2 million annual cost savings will be achieved starting from the last quarter of 2014 onwards. The measures decided and carried out by the end of the review period will bring a run rate improvement of EUR 4.2 million in EBITDA.

The measures to raise efficiency in the Group's administration and cut fixed costs continued during the first quarter. The measures carried out by the end of the review period will bring a run rate improvement of EUR 4.5 million in EBITDA.

The measures in the efficiency program in Sweden for the forging business, which is managed as a separate business, affected all three forges. The running down of the forge in Smedjebacken has moved into its final stages, and the transfers of products to the Arvika forge have mostly been completed. The measures carried out have not brought targeted EBITDA improvement for the time being.

In addition, all other profitability improvement actions in 2013 and first quarter of 2014 have been mainly finalized. The measures carried out by the end of the review period will realize a run rate improvement of EUR 5.2 million in EBITDA.

January - March 2014 interim report

Order book and net sales

The order book at the end of the period was 2% higher than at the same time in the previous year, standing at EUR 91 (89) million, and 4% higher than at end of 2013 when it was EUR 87 million. The order book published by the Group comprises confirmed orders for the next two months.

Net sales in the January - March period increased 3% from the previous year to EUR 132 (128) million. The Group's capacity utilization rate in the review period was 61% and 59% in the corresponding period in the previous year.

Componenta's net sales in the review period by customer sector were as follows: Heavy Trucks 31% (29%), Construction and Mining 18% (20%), Machine Building 20% (18%), Agricultural Machinery 17% (19%) and Automotive 14% (14%).

Result

EBITDA for the January - March period excluding one-time items improved from the previous year to EUR 12.1 (8.2) million.

The consolidated operating profit in the period excluding one-time items improved from the previous

year to EUR 7.4 (3.8) million and after one-time items EUR 6.5 (3.3) million. The improvement compared with same period in the previous year was mainly due to the measures carried out in the efficiency improvement program and to some extent also due to higher volumes. The Turkish lira changes have not had significant effect on the Group's operating profit. The one-time items in the review period are mainly related to the small production line transfer and closure of the Pietarsaari foundry (EUR -0.4 million), the restructuring measures at the Orhangazi foundry (EUR -0.2 million), structural changes and adaptation measures in Wirsbo (EUR -0.2 million), and other onetime items (EUR -0.1 million).

The Group's net financial costs in the review period totalled EUR -7.5 (-6.0) million. Net financial costs increased from the corresponding period in the previous year due to foreign exchange losses and higher interest expenses. The company is planning to refinance its syndicated loan of EUR 66 million during summer 2014 which has caused the rescheduling of arrangement fees for the syndicated loan and this also increased the financial costs in the review period.

The Group's result for the review period after financial items, excluding one-time items, was EUR -0.1 (-2.2) million and after one-time items EUR -1.0 (-2.7) million.

Income taxes for the review period excluding one-time items were EUR

-0.5 (+0.7) million and after one-time items EUR -0.3 (+0.8) million.

Basic earnings per share in the review period, excluding one-time items, were EUR -0.06 (-0.09) and after one-time items EUR -0.09 (-0.11).

The return on investment excluding one-time items was 9.5% (4.9%) and after one-time items 8.5% (4.4%). The return on equity excluding onetime items was -2.9% (-7.2%) and after one-time items -6.4% (-9.7%).

Balance sheet, financing and cash flow

The financing arrangements, that the company started at the beginning of the year aiming to refinance the company's interest-bearing debt with new long-term financial instruments, have made progress according to plan. It is planned to complete the arrangements during the second quarter.

At the end of March, Componenta's cash funds and bank receivables totalled EUR 13.2 (12.1) million. In addition, at the end of the period Componenta's Turkish subsidiary, Componenta Dökümcülük A.S., had unused credit facilities from Turkish banks totalling EUR 15.7 (25.3) million. The Group's cash funds and bank receivables situation improved at the end of March from EUR 10.2 million at the end of last year, even though the company repaid EUR 5 million of its syndicated loan in the first quarter of the year.

Quarterly analysis of changes in income statement excluding one-time items:

MEUR	Q1/14	Q1/13	Change %
Net sales	131.9	127.7	+3%
Value of production	135.9	130.4	+4%
Materials	-55.0	-53.9	+2%
Direct wages and external services	-28.5	-29.0	-2%
Other variable and fixed costs	-40.3	-39.3	+3%
Total costs	-123.8	-122.2	+1%
EBITDA	12.1	8.2	+48%

The Group's interest-bearing net debt, including the outstanding capital notes of EUR 2.9 (23.4) million as defined in IFRS, totalled EUR 223 (248) million at the end of the review period. Net gearing was 267% (330%).

At the end of March the Group's equity ratio was 18.0% (15.9%).

Net cash flow from operations in the review period was EUR 9.7 (-3.0) million, and within this the changes in working capital were EUR 5.0 (-4.1) million. Componenta makes more efficient use of capital with a program to sell its trade receivables. Under this arrangement, some of the trade receivables are sold without any right of recourse. At the end of March the company had sold trade receivables totalling EUR 89.5 (81.9) million.

Investments

Investments in production facilities in the review period totalled EUR 4.0 (3.4) million, and financial lease investments accounted for EUR 0.8 (0.0) million of these. The net cash flow from investments was EUR -1.0 (-3.8) million, which includes the cash flow from the Group's investments in tangible and intangible assets, and the cash flow from shares sold and purchased and from the sale of fixed assets.

Performance of business segments

Foundry Division

The production units in the Foundry Division are located in Orhangazi in Turkey, in Heerlen and Weert in the Netherlands, and in Iisalmi, Karkkila, Pietarsaari and Pori in Finland.

At the end of March the order book for the Foundry Division was 6% lower than at the same time in the previous year, standing at EUR 55.3 (58.7) million.

Net sales for the Foundry Division in the review period was nearly the same as in the previous year standing at EUR 84.6 (85.0) million.

The operating profit in the review period was EUR 4.0 million or 4.7% of net sales (EUR 2.6 million; 3.0%). The operating profit improved from the previous year due to more efficient production and gained cost savings.

The number of personnel in the Foundry Division during the quarter, including leased employees, was on average 1% higher than at the same time in the previous year, standing at 2,843 (2,822).

Machine Shop Division

The production units in the Machine Shop Division are located in Orhangazi in Turkey and in Främmestad in Sweden. The production unit for pistons in Pietarsaari in Finland also belongs to the division.

At the end of March the order book for the Machine Shop Division was 13% higher than at the same time in the previous year, standing at EUR 23.2 (20.4) million.

Net sales in the review period for the Machine Shop Division increased 10% from the corresponding period in the previous year, to EUR 30.4 (27.7) million.

The operating profit in the review period was EUR 0.8 million, or 2.6% of net sales (EUR 0.0 million; 0.1%). The operating profit improved from the previous year due to higher volumes and gained cost savings.

The number of personnel in the Machine Shop Division during the quarter, including leased employees, was on average 1% higher than at the same time in the previous year, standing at 374 (369).

Aluminium Division

The production units in the Aluminium Division, the aluminium foundry and the production unit for aluminium wheels, are located in Manisa, Turkey.

At the end of March the order book for the Aluminium Division was 14% higher than at the same time in the previous year, standing at EUR 14.1 (12.4) million.

Net sales in the January - March period rose 6% from the previous year to EUR 18.1 (17.1) million.

The operating profit in the review period was EUR 2.3 million, or 12.9% of net sales (EUR 2.0 million; 11.5%). The operating profit improved from the corresponding period in the previous year due to higher volumes.

The number of personnel in the Aluminium Division during the quarter, including leased employees, was on average 21% higher than at the same time in the previous year, standing at 819 (678).

Other Business

Other business comprises the Wirsbo forges in Sweden, the sales and logistics company Componenta UK Ltd in Great Britain, service and real estate companies in Finland, the Group's administrative functions and the associated company Kumsan A.S. in Turkey. Other business recorded an operating profit of EUR 0.3 (-0.4) million in the review period.

Personnel

The Group had on average 4,501 (4,321) employees during the review period, including 338 (246) leased employees. The number of Group personnel at the end of the period was 4,512 (4,313), which includes 360 (259) leased employees. At the end of March, 59% (57%) of personnel were in Turkey, 17% (19%) in Finland, 14% (14%) in the Netherlands, and 10% (10%) in Sweden.

Shares and share capital

The shares of Componenta Corporation are quoted on the NASDAQ OMX Exchange in Helsinki. At the end of March the company had a total of 29,269,224 shares and the company's share capital stood at EUR 21.9 (21.9) million. The quoted price at the end of March 2014 stood at EUR 1.57 (1.78). The average price during the review period was EUR 1.67, the lowest price was EUR 1.45 and the highest EUR

1.82. At the end of the review period the share capital had a market capitalization of EUR 46.0 (39.6) million and the volume of shares traded during the period was equivalent to 2.2% (2.9%) of the share stock.

Share issue and special rights with entitlement to shares

Componenta's Annual General Meeting of Shareholders held on 13 March 2014 adopted the Board's proposal to authorize the Board to decide to issue shares and grant special rights with an entitlement to shares as defined in chapter 10, section 1 of the Finnish Limited Liabilities Companies Act in one or more issues, either against payment or free of charge. The number of shares to be issued, including the shares to be obtained under the special rights, may be a maximum of 6,000,000 shares. The Board may decide to issue either new shares or any company shares held by the company.

Under the authorization, the Board of Directors may decide on all the terms and conditions for a share issue and for granting special rights with an entitlement to shares, and includes the right to disapply the pre-emptive subscription rights of shareholders. The authorization may be used to strengthen the company's balance sheet and financial position or for other purposes to be decided by the Board.

The authorization is valid for a period of five (5) years from the date of the decision of the AGM. The authorization cancels the authorization given the Board by the Annual General Meeting of Shareholders held on 22 February 2013 to decide to issue shares and grant special rights with entitlement to shares.

Share-based incentive scheme 2014

The Board of Directors of Componenta Corporation resolved on 17 February 2014 on a new share-based incentive

scheme for key personnel. The objective of the plan is to bring together the goals of the owners and key personnel so as to raise the value of the company, to commit key personnel to the company, and to offer them a competitive bonus scheme based on share ownership. The target group for the scheme comprises key personnel in the Group as determined by the Board of Directors.

The scheme has one earning period, the 2014 calendar year. The earning criterion for the 2014 earning period is Componenta Group's result after financial items. The size of the bonus in the earning period is determined after the end of the period by the extent to which the target set for the earning criterion has been achieved.

Any bonus for the 2014 earning period will be paid as a combination of company shares and cash. The part to be paid in cash is intended to cover the taxes and tax-related costs incurred by key personnel from the bonus. Any shares paid in the incentive scheme may not be disposed of during a restriction period of about two years. Should the employment of a key employee end during this

restriction period, they shall return the shares given as a bonus without compensation.

The target group for the scheme comprises some 20 people. The bonuses to be paid for the 2014 earning period correspond altogether at most to the value of 400,000 Componenta Corporation shares (including the portion to be paid in cash).

The scheme's impact on the Group's result before tax at the end of March was EUR 0.0 million.

Board of Directors and Management

After the AGM on 13 March 2014, the Board of Directors held its organization meeting and elected Harri Suutari as its chairman and Matti Ruotsala as vice chairman. The other Board members are Olavi Huhtala, Heikki Lehtonen, Riitta Palomäki and Tommi Salunen.

At its organization meeting the Board elected Riitta Palomäki to be chairman of the Audit Committee and Olavi Huhtala and Tommi Salunen as members of the committee.

Heikki Lehtonen is President and CEO of Componenta. At the end of the review period the Corporate Executive Team comprised: President and CEO Heikki Lehtonen; Juha Alhonoja, Senior Vice President, Machine Shop Division; CFO Mika Hassinen; Olli Karhunen, Senior Vice President, Foundry Division; Furio Scolaro, Senior Vice President, Sales and Product Development; Anu Mankki, Senior Vice President, HR and Internal Communications; Pauliina Rannikko, Senior Vice President, Legal and Risk Management; and Sabri Özdogan, Senior Vice President, Aluminium Division. Communications Manager Pirjo Aarniovuori was secretary to the Corporate Executive Team.

Risks and business uncertainties

The most significant risks for Componenta are risks related to the business environment (competition and price risk, commodity and environmental risks), operational risks (labour market disruptions, customer and supplier risks, productivity, production and process risks, contract and product liability risks, personnel risks, and data security risks) as well as financial risks (financing and liquidity risk, currency, interest rate and credit risks).

In order to manage the Group's business operations it is essential to secure the availability of certain raw materials, such as recycled metal and pig iron, and of energy, at competitive prices. The cost risk relating to raw materials is mainly managed with price agreements, and under these agreements the prices of products are adjusted in line with the changes in raw material prices. Increases in prices for raw materials may tie up more funds in working capital than estimated.

The financial risks relating to Componenta's business operations are managed in accordance with the treasury policy approved by the Board of Directors. The objective is to protect the Group against unfavourable changes in the financial markets and to secure the Group's financial performance and financial position.

More detailed information about the risks to which Componenta is exposed and risk management is given in the notes to the 2013 Financial Statements.

Business environment

At the end of first quarter the order book for Componenta's Heavy Trucks customer industry was 1% lower than at the same time in the previous year. Demand for heavy trucks in Europe is expected to decrease in 2014. Componenta's sales to Heavy Trucks customer segment is expected to stay similar to last year or to increase due to the growing market share.

The order book for Componenta's Construction and Mining customer industry was 3% higher at the end of first quarter than at the same time in the previous year. Demand is expected to remain at the same level as in the previous year. Customers reduced their stocks during 2012 and 2013 due to weaker prospects in particular for mining machinery industry. Demand prospects for Componenta are stable due to higher demand from end-customers.

The order book for Componenta's Machine Building customer segment was 10% higher at the end of first quarter than at the same time in the previous year. Componenta's sales to Machine Building customer segment are expected to increase in 2014.

The order book for Componenta's Agricultural Machinery customer sector was 1% higher at the end of first quarter than at the same time in the previous year. Demand for

Net sales, MEUR

Operating profit excluding one-time items, MEUR

Result after financial items, excluding one-time items, MEUR

agricultural machinery is expected to remain stable in 2014. Componenta's sales to Agricultural Machinery customer sector is expected to remain at the same level as in the previous year or to increase due to growing market share.

The order book for Componenta's Automotive customer sector was 2% higher at the end of first quarter than at the same time in the previous year. In 2014, the market is expected to improve from the previous year. Componenta's sales are expected to stay similar to last year or to increase in 2014.

Prospects for Componenta

The prospects for Componenta in 2014 are based on general external economic indicators, delivery forecasts given by customers, and on Componenta's order intake and order book.

Componenta's order book was 4% higher than at the end of 2013 and was EUR 91 (87) million.

In consequence of the structural efficiency measures being carried out, the operating profit for the full year excluding one-time items is expected to improve from the previous year.

Interim report tables

Componenta has applied the same accounting principles in this interim report as in the financial statements for 2013. As from the start of the fiscal year, the company has also applied certain new or revised IFRS standards as described in the 2013 Financial Statements.

In the financial statements 2013 the Group changed the accounting practice for defining the current value of the defined benefit in Turkey. In accordance with the new accounting practices the Group calculated, by using actuarial calculations, the amount that actuarial gains and losses account for in the change in the current value for the scheme, and this was recognised in items in the statement of comprehensive income. The result for the period for comparison did not include any significant actuarial gains or losses.

Consolidated income statement excluding one-time items

MEUR	1.1.-31.3.2014	1.1.-31.3.2013	1.1.-31.12.2013
Net sales	131.9	127.7	510.5
Other operating income	0.4	1.1	5.7
Operating expenses	-120.2	-120.6	-480.1
Depreciation, amortization and write-downs	-4.7	-4.4	-18.0
Share of the associated companies' result	0.0	0.0	0.1
Operating profit	7.4	3.8	18.2
% of net sales	5.6	3.0	3.6
Financial income and expenses	-7.5	-6.0	-24.4
Result after financial items	-0.1	-2.2	-6.2
% of net sales	-0.1	-1.7	-1.2
Income taxes	-0.5	0.7	-4.5
Net profit	-0.6	-1.4	-10.7
Allocation of net profit for the period
To equity holders of the parent	-0.9	-1.5	-10.9
To non-controlling interest	-0.3	0.1	0.2
	-0.6	-1.4	-10.7
Earnings per share calculated on the profit
attributable to equity holders of the parent
Earnings per share, EUR	-0.06	-0.09	-0.55

Consolidated income statement

MEUR	1.1.-31.3.2014	1.1.-31.3.2013	1.1.-31.12.2013
Net sales	131.9	127.7	510.5
Other operating income	0.4	1.1	5.9
Operating expenses	-121.1	-121.1	-483.2
Depreciation, amortization and write-downs	-4.7	-4.4	-18.4
Share of the associated companies' result	0.0	0.0	0.1
Operating profit	6.5	3.3	14.9
% of net sales	4.9	2.6	2.9
Financial income and expenses	-7.5	-6.0	-24.5
Result after financial items	-1.0	-2.7	-9.6
% of net sales	-0.8	-2.1	-1.9
Income taxes	-0.3	0.8	-6.0
Net profit	-1.3	-1.9	-15.5
Allocation of net profit for the period
To equity holders of the parent	-1.6	-2.0	-15.8
To non-controlling interest	0.3	0.1	0.2
	-1.3	-1.9	-15.5
Earnings per share calculated on the profit
attributable to equity holders of the parent
Earnings per share, EUR	-0.09	-0.11	-0.75
Earnings per share with dilution, EUR	-0.09	-0.11	-0.75

Consolidated statement of comprehensive income

MEUR	1.1.-31.3.2014	1.1.-31.3.2013	1.1.-31.12.2013
Net profit	-1.3	-1.9	-15.5
Other comprehensive income
Items that will not be reclassified subsequently to profit or loss
Revaluation of buildings and land areas	-	-	-1.8
Items that may be reclassified subsequently to profit or loss
Translation differences	-0.2	-0.4	-1.2
Actuarial gains and losses	-0.2	-	-1.7
Cash flow hedges	-0.2	0.0	-0.3
Other items	0.0	0.0	0.0
Total items that may be reclassified to profit or loss subsequently	-0.5	-0.4	-3.2
Income tax on other comprehensive income	0.1	0.0	0.9
Other comprehensive income, net of tax	-0.4	-0.4	-4.1
Total comprehensive income	-1.8	-2.3	-19.6
Allocation of total comprehensive income
To equity holders of the parent	-2.0	-2.4	-19.7
To non-controlling interest	0.2	0.1	0.0
	-1.8	-2.3	-19.6

Consolidated statement of financial position

MEUR	31.3.2014	31.3.2013	31.12.2013
Assets
Non-current assets
Intangible assets	9.0	6.4	9.7
Goodwill	29.1	29.1	29.1
Investment properties	9.8	11.4	11.6
Tangible assets	252.3	255.2	253.3
Investment in associates	1.1	1.5	1.3
Receivables	4.1	4.3	4.2
Other investments	0.9	0.9	0.9
Deferred tax assets	34.7	32.3	34.0
Total non-current assets	341.0	341.1	344.1
Current assets
Inventories	66.4	70.1	63.1
Receivables	43.4	48.6	34.4
Tax receivables	0.1	0.8	0.1
Cash and cash equivalents	13.2	12.1	10.2
Total current assets	123.0	131.6	107.8
Total assets	463.9	472.7	452.0
Shareholders' equity and liabilities
Shareholders' equity
Share capital	21.9	21.9	21.9
Other equity	53.8	45.6	55.8
Equity attributable to equity holders of the parent company	75.7	67.5	77.7
Non-controlling interest	7.6	7.5	7.4
Shareholders' equity	83.4	75.0	85.2
Liabilities
Non-current
Capital loans	2.3	19.7	2.3
Interest bearing	75.4	153.3	134.2
Interest free	0.7	0.9	0.6
Provisions	8.5	8.7	8.5
Deferred tax liability	11.7	9.2	12.6
Current
Capital loans	0.6	3.7	0.6
Interest bearing	157.6	83.0	102.7
Interest free	118.5	114.0	101.8
Tax liabilities	1.7	0.2	0.4
Provisions	3.6	5.0	3.3
Total liabilities	380.6	397.7	366.8
Total shareholders' equity and liabilities	463.9	472.7	452.0

Condensed consolidated cash flow statement

MEUR	1.1.-31.3.2014	1.1.-31.3.2013	1.1.-31.12.2013
Cash flow from operating activities
Result after financial items	-1.0	-2.7	-9.6
Depreciation, amortization and write-downs	4.7	4.4	18.4
Net financial income and expenses	7.5	6.0	24.5
Other income and expenses, adjustments to cash flow	-0.1	-0.9	-4.7
Change in net working capital	5.0	-4.1	2.6
Cash flow from operations before financing and income taxes	16.2	2.8	31.2
Interest received and paid and dividends received	-6.5	-5.6	-23.3
Taxes paid	0.0	-0.2	-5.7
Net cash flow from operating activities	9.7	-3.0	2.2
Cash flow from investing activities
Acquisition of subsidiaries, net of cash acquired	-	-	-0.1
Capital expenditure in tangible and intangible assets	-3.1	-3.9	-16.4
Proceeds from tangible and intangible assets	2.1	0.0	0.6
Other investments and loans granted	0.0	0.0	0.0
Proceeds from other investments and repayments of loan receivables	0.0	0.0	0.1
Net cash flow from investing activities	-1.0	-3.8	-15.7
Cash flow from financing activities
Dividends paid	-	-0.9	-1.1
Interest paid, hybrid bond	-	-	-3.3
Proceeds from share issue	-	-	4.2
Proceeds from the issue of hybrid bond	-	-	0.1
Repayment of finance lease liabilities	-1.0	-0.7	-3.8
Draw-down (+)/ repayment (-) of current loans	1.1	8.2	13.6
Draw-down of non-current loans	0.0	5.0	30.3
Repayment of non-current loans and other changes	-5.7	-13.1	-37.0
Net cash flow from financing activities	-5.6	-1.6	3.0
Change in liquid assets	3.0	-8.5	-10.5
Cash and cash equivalents at the beginning of the period	10.2	20.6	20.6
Effects of exchange rate changes on cash	0.0	0.0	0.0
Cash and cash equivalents at the period end	13.2	12.1	10.2

					Trans -				Share -
		Share		Cash	lation			Non	holders'
	Share	premium	Other	flow	diffe	Retained		controlling	equity
MEUR	capital	account	reserves	hedges	rences	earnings	Total	interest	total
Shareholders' equity 1.1.2013	21.9	15.0	94.7	-0.4	-35.6	-20.9	74.6	8.8	83.4
Net profit						-2.0	-2.0	0.1	-1.9
Translation differences					-0.3		-0.3	0.0	-0.4
Cash flow hedges				0.0			0.0		0.0
Other comprehensive income
items			0.0				0.0		0.0
Total comprehensive income			0.0	0.0	-0.3	-2.0	-2.4	0.1	-2.3
Interest, hybrid bond						-1.9	-1.9		-1.9
Dividend							0.0	-1.1	-1.1
Items decreased directly from
equity *)						-2.9	-2.9	-0.2	-3.1
Shareholders' equity 31.3.2013	21.9	15.0	94.7	-0.4	-35.9	-27.8	67.5	7.5	75.0

Statement of changes in consolidated shareholders' equity

*) Prior year 2004 the subsidiary in Turkey has recorded the inflation related value increase adjustments directly in equity in accordance with IAS 29. The inflation adjustments have been reclassified in equity and the tax charges of the reclassification have been recorded directly in equity, hence the value adjustments were also recorded directly in equity at the time.

					Trans -				Share -
		Share		Cash	lation			Non	holders'
	Share	premium	Other	flow	diffe	Retained		controlling	equity
MEUR	capital	account	reserves	hedges	rences	earnings	Total	interest	total
Shareholders' equity 1.1.2014	21.9	15.0	121.3	-0.7	-36.8	-42.9	77.7	7.4	85.2
Net profit						-1.6	-1.6	0.3	-1.3
Translation differences					-0.1		-0.1	0.0	-0.1
Actuarial gains and losses						-0.1	-0.1	0.0	-0.1
Cash flow hedges				-0.2			-0.2		-0.2
Other comprehensive income
items			0.0				0.0		0.0
Total comprehensive income			0.0	-0.2	-0.1	-1.7	-2.0	0.2	-1.8
Shareholders' equity 31.3.2014	21.9	15.0	121.3	-0.9	-36.9	-44.6	75.7	7.6	83.4

Key Ratios	31.3.2014	31.3.2013	31.12.2013
Equity ratio, %	18.0	15.9	18.9
Equity per share, EUR	2.59	3.04	2.66
Invested capital at period end, MEUR	319.2	334.7	324.9
Return on investment, excl. one-time items, %	9.5	4.9	5.9
Return on investment, %	8.5	4.4	4.9
Return on equity, excl. one-time items, %	-2.9	-7.2	-12.8
Return on equity, %	-6.4	-9.7	-18.6
Net interest bearing debt, preferred capital note in debt, MEUR	222.7	247.5	229.6
Net gearing, preferred capital note in debt, %	267.1	330.1	269.6
Order book, MEUR	90.7	89.1	87.3
Investments in non-current assets without finance leases, MEUR	3.3	3.4	16.4
Investments in non-current assets incl. finance leases, MEUR	4.0	3.4	18.9
Investments in non-current assets (incl. finance leases), % of net sales	3.1	2.7	3.7
Average number of personnel during the period	4,162	4,075	4,153
Average number of personnel during the period, incl. leased personnel	4,501	4,321	4,464
Number of personnel at period end	4,152	4,054	4,154
Number of personnel at period end, incl. leased personnel	4,512	4,313	4,431
Share of export and foreign activities in net sales, %	90.8	91.2	91.6
Contingent liabilities, MEUR	524.1	535.3	525.8
Earnings per share (EPS), EUR	-0.09	-0.11	-0.75
Earnings per share, with dilution (EPS), EUR	-0.09	-0.11	-0.75
Cash flow per share, EUR	0.33	-0.14	0.09

Changes in tangible assets and goodwill

MEUR	1-3/2014	1-3/2013	1-12/2013
Changes in tangible assets
Acquisition cost at the beginning of the period	561.3	571.1	571.1
Translation differences	-0.9	2.8	-2.9
Additions	4.0	2.8	15.7
Companies acquired	-	-	0.0
Revaluation of buildings and land areas	-	-	-1.8
Disposals and transfers between items	-1.0	-1.1	-20.8
Acquisition cost at the end of the period	563.4	575.5	561.3
Accumulated depreciation at the beginning of the period	-308.0	-315.1	-315.1
Translation differences	0.6	-1.8	1.7
Accumulated depreciation on disposals and transfers	0.4	0.3	20.8
Accumulated depreciation on companies acquired	-	-	-
Depreciation, amortization and write-downs during the period	-4.1	-3.7	-15.4
Accumulated depreciation at the end of the period	-311.1	-320.3	-308.0
Book value at the end of the period	252.3	255.2	253.3
Goodwill
Acquisition cost at the beginning of the period	29.1	29.1	29.1
Translation difference	0.0	0.0	0.0
Book value at the end of the period	29.1	29.1	29.1

Group development

Net sales by market area

MEUR	1-12/2013	1-3/2013	1-3/2014
Germany	107.4	27.9	28.2
Sweden	97.6	22.6	25.3
Turkey	64.8	17.2	15.4
UK	56.3	13.8	12.2
Finland	42.7	11.3	12.1
Benelux countries	37.2	9.6	10.3
France	32.9	7.8	8.1
Italy	27.6	6.9	6.9
Other European countries	17.5	4.2	5.1
Other countries	26.6	6.2	8.2
Total	510.5	127.7	131.9

Quarterly net sales development by market area

MEUR	Q1/13	Q2/13	Q3/13	Q4/13	Q1/14
Germany	27.9	27.8	24.5	27.2	28.2
Sweden	22.6	27.2	21.9	25.8	25.3
Turkey	17.2	20.4	13.0	14.2	15.4
UK	13.8	15.3	15.6	11.6	12.2
Finland	11.3	11.9	9.8	9.7	12.1
Benelux countries	9.6	10.1	9.2	8.2	10.3
France	7.8	9.2	7.1	8.7	8.1
Italy	6.9	7.1	7.6	5.9	6.9
Other European countries	4.2	4.6	3.6	5.0	5.1
Other countries	6.2	6.7	6.7	7.0	8.2
Total	127.7	140.3	119.0	123.5	131.9

Group development excluding one-time items

MEUR	1-12/2013	1-3/2013	1-3/2014
Net sales	510.5	127.7	131.9
Operating profit	18.2	3.8	7.4
Net financial items *)	-24.4	-6.0	-7.5
Profit after financial items	-6.2	-2.2	-0.1

*) Net financial items are not allocated to business segments

Operating profit, MEUR	1-12/2013	1-3/2013	1-3/2014
Foundry division	4.6	2.6	4.0
Machine shop division	2.7	0.0	0.8
Aluminium division	9.7	2.0	2.3
Other business	1.6	-0.4	0.3
Internal items	-0.3	-0.3	0.0
Componenta total	18.2	3.8	7.4

Group development by business segment excluding one-time items

Group development by quarter excluding one-time items

MEUR	Q1/13	Q2/13	Q3/13	Q4/13	Q1/14
Net sales	127.7	140.3	119.0	123.5	131.9
Operating profit	3.8	8.5	2.2	3.7	7.4
Net financial items *)	-6.0	-5.7	-6.7	-6.1	-7.5
Profit after financial items	-2.2	2.9	-4.4	-2.5	-0.1

*) Net financial items are not allocated to business segments

Quarterly development by business segment excluding one-time items

Operating profit, MEUR	Q1/13	Q2/13	Q3/13	Q4/13	Q1/14
Foundry division	2.6	5.0	-1.9	-1.0	4.0
Machine shop division	0.0	0.9	1.0	0.8	0.8
Aluminium division	2.0	2.3	2.6	2.9	2.3
Other business	-0.4	0.8	0.5	0.6	0.3
Internal items	-0.3	-0.3	0.0	0.3	0.0
Componenta total	3.8	8.5	2.2	3.7	7.4

Group development

MEUR	1-12/2013	1-3/2013	1-3/2014
Net sales	510.5	127.7	131.9
Operating profit	14.9	3.3	6.5
Net financial items *)	-24.5	-6.0	-7.5
Profit after financial items	-9.6	-2.7	-1.0

*) Net financial items are not allocated to business segments

Group development by business segment

Net sales, MEUR	1-12/2013	1-3/2013	1-3/2014
Foundry division	329.0	85.0	84.6
Machine shop division	115.5	27.7	30.4
Aluminium division	72.8	17.1	18.1
Other business	141.9	35.5	36.0
Internal items	-148.7	-37.6	-37.1
Componenta total	510.5	127.7	131.9
Operating profit, MEUR	1-12/2013	1-3/2013	1-3/2014
Foundry division	4.6	2.6	4.0
Machine shop division	2.7	0.0	0.8
Aluminium division	9.7	2.0	2.3
Other business	1.6	-0.4	0.3
One-time items	-3.3	-0.5	-0.9*)
Internal items	-0.3	-0.3	0.0

*) One-time items in 2014 relate to the small production line transfer and closure of the Pietarsaari Foundry, EUR -0.4 million, restructuring measures at Orhangazi Foundry in Turkey, EUR -0.2 million and structural changes and adaptation measures in Wirsbo, EUR -0.2 million. Other one-time items were EUR -0.1 million.

Order book, MEUR	12/2013*)	3/2013	3/2014
Foundry division	51.2	58.7	55.3
Machine shop division	20.5	20.4	23.2
Aluminium division	12.8	12.4	14.1
Other business	21.7	21.6	21.0
Internal items	-19.0	-24.1	-22.9
Componenta total	87.3	89.1	90.7

*) Order book on 6 January 2014

Group development by quarter

MEUR	Q1/13	Q2/13	Q3/13	Q4/13	Q1/14
Net sales	127.7	140.3	119.0	123.5	131.9
Operating profit	3.3	8.0	1.5	2.1	6.5
Net financial items *)	-6.0	-5.7	-6.7	-6.1	-7.5
Profit after financial items	-2.7	2.3	-5.2	-4.0	-1.0

*) Net financial items are not allocated to business segments.

Quarterly development by business segment

Net sales, MEUR	Q1/13	Q2/13	Q3/13	Q4/13	Q1/14
Foundry division	85.0	95.9	74.9	73.3	84.6
Machine shop division	27.7	30.9	26.7	30.2	30.4
Aluminium division	17.1	18.7	18.6	18.4	18.1
Other business	35.5	38.9	33.5	33.9	36.0
Internal items	-37.6	-44.1	-34.8	-32.2	-37.1
Componenta total	127.7	140.3	119.0	123.5	131.9
Operating profit, MEUR	Q1/13	Q2/13	Q3/13	Q4/13	Q1/14
Foundry division	2.6	5.0	-1.9	-1.0	4.0
Machine shop division	0.0	0.9	1.0	0.8	0.8
Aluminium division	2.0	2.3	2.6	2.9	2.3
Other business	-0.4	0.8	0.5	0.6	0.3
One-time items	-0.5	-0.6	-0.7	-1.5	-0.9*)
Internal items	-0.3	-0.3	0.0	0.3	0.0

*) One-time items in 2014 relate to the small production line transfer and closure of the Pietarsaari Foundry, EUR -0.4 million, restructuring measures at Orhangazi Foundry in Turkey, EUR -0.2 million and structural changes and adaptation measures in Wirsbo, EUR -0.2 million. Other one-time items were EUR -0.1 million.

Order book at period end, MEUR	Q1/13	Q2/13	Q3/13	Q4/13*)	Q1/14
Foundry division	58.7	54.6	46.7	51.2	55.3
Machine shop division	20.4	24.3	19.2	20.5	23.2
Aluminium division	12.4	14.1	13.0	12.8	14.1
Other business	21.6	25.6	20.3	21.7	21.0
Internal items	-24.1	-24.0	-15.4	-19.0	-22.9
Componenta total	89.1	94.7	83.6	87.3	90.7

*) Order book on 6 January 2014

Business segments

MEUR	31.3.2014	31.3.2013	31.12.2013
Foundry division
Assets	237.2	233.4	222.8
Liabilities	91.0	73.9	73.8
Investments in non-current assets (incl. finance leases)	2.1	0.8	6.6
Depreciation, amortization and write-downs	2.3	2.2	9.0
Machine shop division
Assets	63.9	58.3	61.9
Liabilities	30.4	22.5	25.9
Investments in non-current assets (incl. finance leases)	0.7	0.6	6.4
Depreciation, amortization and write-downs	0.8	0.7	2.8
Aluminium division
Assets	73.3	75.4	70.4
Liabilities	9.3	17.8	8.2
Investments in non-current assets (incl. finance leases)	1.0	0.9	1.7
Depreciation, amortization and write-downs	0.7	0.5	2.5
Other business
Assets	77.0	88.0	83.7
Liabilities	44.4	49.3	44.7
Investments in non-current assets (incl. finance leases)	0.3	1.1	4.2
Depreciation, amortization and write-downs	0.9	0.9	4.1

Fair values of derivative instruments

		31.3.2014		31.3.2013	31.12.2013
	Fair value,	Fair value,	Fair value,	Fair value,	Fair value,
MEUR	positive	negative	net	net	net
Currency derivatives
Foreign exchange forwards	0.2	0.0	0.2	0.0	0.0
Currency swaps	0.1	-0.3	-0.2	-0.3	-2.1
Foreign exchange options	0.0	-	0.0	0.0	-
Interest rate derivatives
Interest rate swaps	0.0	-0.2	-0.2	-0.7	-0.3
Commodity derivatives
Electricity price forwards	0.0	-1.3	-1.3	-0.6	-1.1
Total	0.4	-1.8	-1.5	-1.7	-3.4

Nominal values of derivative instruments

MEUR	31.3.2014 Nominal value	31.3.2013 Nominal value	31.12.2013 Nominal value
Currency derivatives *)
Foreign exchange forwards	17.3	1.3	0.7
Currency swaps	27.1	101.7	96.2
Foreign exchange options	7.2	3.0	-
Interest rate derivatives
Interest rate swaps
Maturity in less than a year	12.5	35.0	12.5
Maturity after one year and less than five years	5.0	17.5	5.0
Commodity derivatives
Electricity price forwards
Maturity in less than a year	1.9	2.4	2.5
Maturity after one year and less than five years	3.3	4.5	2.9
Total	74.2	165.4	119.8

*) Currency derivatives mature in less than a year.

Classification of fair value of financial assets and liabilities

Financial assets and liabilities that are valued at fair value, are classified on three levels depending on the estimated reliability of the valuation method:

LEVEL 1:

A reliable quoted market price exists for identical instruments quoted on an active market. Electricity price forwards are classified on this level, as their valuations are based on market prices for Nord Pool's similar standardized products.

LEVEL 2:

A market price quoted on the active market exists for similar but not identical instruments. The price may, however, be derived from observable market information. The fair values of interest rate and currency derivatives are calculated by deriving them from price information obtained on the active market and using valuation techniques that are commonly applied in the market.

LEVEL 3:

There is no active market for the instrument, a fair market price cannot be reliably derived, and defining the fair value requires significant assumptions.

Fair values by classification of valuation method Q1/2014

MEUR	LEVEL 1	LEVEL 2	LEVEL 3
Foreign exchange rate derivatives (OTC)	-	0.0	-
Interest rate derivatives (OTC)	-	-0.2	-
Commodity derivatives	-1.3	-	-
Available-for-sale investments	-	-	0.9

Fair values by classification of valuation method Q1/2013

MEUR	LEVEL 1	LEVEL 2	LEVEL 3
Foreign exchange rate derivatives (OTC)	-	-0.3	-
Interest rate derivatives (OTC)	-	-0.7	-
Commodity derivatives	-0.6	-	-
Available-for-sale investments	-	-	0.9

Fair values by classification of valuation method Q4/2013

MEUR	LEVEL 1	LEVEL 2	LEVEL 3
Foreign exchange rate derivatives (OTC)	-	-2.1	-
Interest rate derivatives (OTC)	-	-0.3	-
Commodity derivatives	-1.1	-	-
Available-for-sale investments	-	-	0.9

No financial assets or liabilities were transferred from one level to another during the financial year.

The fair value of forward rate agreements is the profit or loss that would occur from closing the agreement, calculated at the market price on the balance sheet date. The fair value of interest rate and currency options is measured using commonly known option pricing models. The fair value of interest rate swaps is calculated by discounting future cash flows at current interest rates at the balance sheet date. Foreign exchange forwards and swaps are valued at forward prices on the balance sheet date. The fair value of electricity price forwards is the estimated profit or loss that would derive from closing the contracts at market prices on the balance sheet date.

Contingent liabilities

MEUR	31.3.2014	31.3.2013	31.12.2013
Real-estate mortgages
For own debts	11.7	11.8	11.7
Business mortgages
For own debts	103.5	103.8	103.6
Pledges
For own debts	402.6	405.6	404.0
Other leasing commitments	5.4	7.2	5.7
Other commitments	0.9	7.0	0.9
Total	524.1	535.3	525.8

Key exchange rates for the Euro

		Closing rate			Average rate
One Euro is	31.3.2014	31.3.2013	31.12.2013	31.3.2014	31.3.2013	31.12.2013
SEK	8.9483	8.3553	8.8591	8.8569	8.4965	8.6515
USD	1.3788	1.2805	1.3791	1.3696	1.3206	1.3281
GBP	0.8282	0.8456	0.8337	0.8279	0.8511	0.8493
TRY (Turkish central bank)	3.0072	2.3189	2.9365	3.0356	2.3547	2.5271

Calculation of key financial ratios

	Profit after financial items – income taxes x 100
Return on equity, % = (ROE) *)	Shareholders' equity without preferred capital notes + non-controlling interest (quarterly average)
Return on investment, % =	Profit after financial items + interest and other financial expenses x 100
(ROI) *)	Shareholders' equity + interest bearing liabilities (quarterly average)
Equity ratio, % =	Shareholders' equity, preferred capital notes excluded + non-controlling interest x 100 Balance sheet total - advances received
Earnings per share, EUR = (EPS)	Profit after financial items – income taxes +/- non-controlling interest - deferred and paid interest on hybrid loan
	Average number of shares during the financial period
Earnings per share with dilution, EUR	= As above, the number of shares has been increased with the possible warrants outstand ing. When calculating the dilution effect of warrants, the number of shares has been adjusted with the number of own shares which the company could have acquired, if it would have used the funds generated from the warrants to buy back of own shares at market price (= average trading price). After tax interest expense of the possible convertible loan has been added to the profit of the period. Number of shares that can be subscribed by the loan has been added to the number of total shares.
Cash flow per share, EUR	Net cash flow from operating activities
= (CEPS)	Average number of shares during the financial period
Equity per share, EUR =	Shareholders' equity, preferred capital notes excluded Number of shares at period end
Net interest bearing debt, = MEUR	Interest bearing liabilities + preferred capital notes - cash and bank accounts
Net gearing, % =	Net interest bearing liabilities x 100
	Shareholders' equity, preferred capital notes excluded + non-controlling interest
EBITDA, EUR =	Operating profit + Depreciation, amortization and write-downs +/- Share of the associated companies' result

*) The profit for the first quarter of the year in ROE and ROI has been calculated as an average annual return (annualised).

Largest registered shareholders on 31 March 2014

			Share of total
Shareholder		Shares	voting rights, %
1 Lehtonen Heikki		7,528,492	25.72
Oy Högfors-Trading Ab	4,010,704
Cabana Trade S.A.	3,501,988
Lehtonen Heikki	15,800
2 Etra Capital Oy		6,751,450	23.07
3 Finnish Industry Investment Ltd		2,666,662	9.11
4 Varma Mutual Pension Insurance Company		2,385,218	8.15
5 Mandatum Life		1,166,402	3.99
6 Nordea Life Assurance Finland Ltd		800,000	2.73
7 Alfred Berg Finland Fund		411,574	1.41
8 Bergholm Heikki		375,016	1.28
9 Laakkonen Mikko		370,000	1.26
10 Danske Fund Finnish Small Cap		332,000	1.13
Nominee-registered shares		275,933	0.94
Other shareholders		6,206,477	21.20
Total		29,269,224	100.00

The members of the Board of Directors own 26.6% of the shares. All shares have equal voting rights.

Helsinki, 25 April 2014

COMPONENTA CORPORATION Board of Directors

Componenta Corporation

Panuntie 4 FI-00610 Helsinki Finland Tel. +358 10 403 00 Fax +358 10 403 2721 www.componenta.com