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Componenta Oyj Interim / Quarterly Report 2022
3307_rns_2022-07-22_355c66f7-de22-4a07-ad31-1b98977ea1ef.pdf
Interim / Quarterly Report
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Componenta Corporation's Half-year Financial Report 2022
COMPONENTA
Componenta Corporation's Half-year Financial Report 1 January–30 June 2022
Net sales increased and EBITDA improved
January–June 2022
- Net sales increased to EUR 54.4 million (EUR 43.5 million).
- EBITDA improved to EUR 3.8 million (EUR 3.3 million).
- Operating result was EUR 1.0 million (EUR 0.4 million).
- Cash flow from operating activities was EUR 2.1 million (EUR 4.3 million).
April–June 2022
- Net sales increased to EUR 28.9 million (EUR 23.1 million).
- EBITDA improved to EUR 2.4 million (EUR 1.8 million).
- Operating result was EUR 1.0 million (EUR 0.3 million).
- Cash flow from operating activities was EUR 2.0 million (EUR 3.4 million).
The information presented in this half-year financial report concerns Componenta Group's performance in January–June 2022 and in the corresponding period of 2021, unless otherwise stated. Componenta has foundries in Pori and Karkkila, Finland, and metal product plants in Jyväskylä, Härmä, Kurikka, Leppävesi and Sastamala, Finland. The Group also includes real estate companies of minor importance in Finland. All Componenta Group's restructuring programmes were completed in 2021.
Sami Sivuranta, President and CEO:
"We managed well in an challenging operating environment during the first half of the year. Our net sales, EBITDA and market share continued to grow in line with our targets, and we are pleased with the result. Our liquidity remained in a good level throughout the review period.
Our profitability during the review period was burdened somewhat by the exceptional price development of raw materials, materials and energy, which has significantly increased our manufacturing costs. In terms of our main raw materials and electricity, the cost development is largely tied to our customer agreements through indices, which are reflected in our sales prices with a delay. We have also separately agreed with our customers on compensation for cost increases in material prices not tied to any indices. These price agreements entered into force during the second quarter.
In addition, quality and productivity challenges at the Karkkila foundry affected our profitability to some extent. In our Karkkila unit, the recovery in demand and very good success in new sales have led to an exceptionally rapid growth in production volumes. This has generated special needs and challenges both, in terms of increasing resources in the workforce and in terms of rapidly increased technical process capacity. However, our activities to remedy the situation in Karkkila are progressing according to plan.
Our half-year result was also burdened by costs of EUR 0.3 million in the first quarter related to an acquisition that was not realized.
The prolonged crisis in Eastern Europe has increased challenges in the availability of materials and cost development. Componenta has no operations of its own in Russia or Ukraine. The direct impacts through our customers' and suppliers' business operations have been minor, as have the indirect impacts of the crisis for the time being. We are actively monitoring developments in our business environment and
Half-year Financial Report 1 January–30 June 2022
seeking to ensure the availability of raw materials in all situations and circumstances.
Componenta's delivery capability has remained good throughout the COVID-19 pandemic. In our own operations, we have successfully managed our supply chain and secured our production and deliveries to customers. Our entire personnel have shown flexibility in maintaining our production and delivery reliability during these challenging times.
Our customers' forecasts and expectations have remained generally positive throughout the review period, and our order book was very strong at the end of the review period.
The circular economy plays a significant role in Componenta's production processes. We are committed to provide our customers high-quality and responsibly produced components. Our production operations are located close to our key customers, and we are able to respond quickly and flexibly to changes in the global market at the local level.
We will actively continue our efforts to strengthen our market position and further improve our profitability as part of our growth strategy. In addition, we are focusing on our service capability, close customer relationships, sustainability and highly competent personnel, as well as on expanding our offering. We are investing in close partnerships with our customers, aiming to be their preferred supplier with a sustainable and extensive offering."
Componenta's guidance for 2022 remains unchanged
Componenta expects the Group's net sales to be EUR 90-105 million in 2022. EBITDA is expected to improve from the previous year. The Group's net sales in 2021 were EUR 87.3 million, and its EBITDA was EUR 5.0 million.
Potential poor availability of raw materials, increases in the prices of raw materials and energy, the general economic situation and competitive climate, and the development of customers' sales volumes may affect business outlooks. Due to the COVID-19 pandemic and the crisis in Ukraine, the development of sales and profitability involves uncertainties and
poor predictability. An unfavourable development of the geopolitical situation related to Russia and Ukraine can have a negative impact on the financial market, sales volumes, the availability and price development of raw materials and energy and the availability of foreign labour, which increases uncertainty in terms of forecasts.
Order book
Componenta's order book at the end of June 2022 was EUR 13.4 million (EUR 12.0 million). The order book contains the orders confirmed to customers for the next two months.
Net sales
Componenta's net sales increased by 25.2% from the previous year to EUR 54.4 million (EUR 43.5 million). Net sales were divided between customer industries as follows: machine building 48% (44%), agricultural machinery 30% (27%), forest machinery 7% (8%), the energy industry 8% (8%), the defence equipment industry 1% (6%) and other industries 6% (7%). The decrease in the share of the defence equipment industry is a result of investments in machinery and equipment that were implemented during the review period.
Result
The Group's EBITDA increased from the previous year, amounting to EUR 3.8 million (EUR 3.3 million). Its profitability improved as a result of higher sales volumes and systematic development measures. Productivity in the review period was burdened somewhat by quality and productivity challenges at the Karkkila foundry and by non-recurring advisory costs of EUR 0.3 million in the first quarter related to an acquisition that was not realized. In addition, the rising trend in the purchase prices of materials and the price of electricity had a negative impact on profitability. Most of the increases in purchase prices and the price of electricity will be reflected in sales prices with a delay in line with the index terms included in customer agreements. In the comparison period, profitability was also improved by a one-time payment of EUR 0.1 million from the bankruptcy estate of Componenta BV, a former subsidiary, for receivables that had been previously written down.
Half-year Financial Report 1 January-30 June 2022
The Group's operating result increased from the previous year, amounting to EUR 1.0 million (EUR 0.4 million). The Group's net financial items totalled EUR -0.7 million (EUR -0.1 million). Net financial items in the comparison period include EUR 0.7 million in financial income that was realised when the parent company's restructuring debt of EUR 6.6 million was repaid at EUR 5.9 million.
The Group's result after financial items was EUR 0.3 million (EUR 0.2 million). Taxes in the review period totalled EUR 0.1 million (EUR 0.0 million). In the review period, the tax income consisted of a change in deferred tax liabilities. The Group's net result for the period was EUR 0.4 million (EUR 0.1 million). Basic earnings per share were EUR 0.04 (EUR 0.02) for the review period.
Key figures
| Jan 1–Jun 30, 2021 | Jan 1–Dec 31, 2021 | Change, % | Jan 1–Jun 30, 2022 | |
|---|---|---|---|---|
| Net sales, EUR thousand | 54,408 | 43,468 | 25.2 | 87,254 |
| EBITDA, EUR thousand | 3,827 | 3,290 | 16.3 | 4,959 |
| Operating result, EUR thousand | 1,049 | 358 | 193.2 | 13 |
| Operating result, % | 1.9 | 0.8 | 134.2 | 0.0 |
| Result after financial items, EUR thousand | 329 | 229 | 43.7 | -405 |
| Net result, EUR thousand | 415 | 146 | 184.5 | -405 |
| Basic earnings per share, EUR | 0.04 | 0.02 | 160.6 | -0.04 |
| Diluted earnings per share, EUR | 0.04 | 0.02 | 163.9 | -0.04 |
| Cash flow from operating activities, EUR thousand | 2,090 | 4,329 | -51.7 | 2,837 |
| Interest-bearing net debt, EUR thousand* | 5,924 | 1,263 | 369.2 | 6,714 |
| Net gearing, % | 24.7 | 5.2 | 373.1 | 28.6 |
| Return on equity, % | 3.5 | 1.2 | 190.3 | -1.7 |
| Return on investment, % | 6.0 | 5.5 | 9.8 | 3.2 |
| Equity ratio, % | 41.6 | 39.1 | 6.5 | 42.3 |
| Capital expenditure incl. lease liabilities, EUR thousand | 815 | 957 | -14.9 | 1,249 |
| Group's restructuring debt, EUR thousand** | 0 | 3,608 | -100.0 | 0 |
| Number of personnel at the end of the period, incl. leased workers | 644 | 596 | 8.0 | 612 |
| Average number of personnel during the period, incl. leased workers | 634 | 586 | 8.1 | 592 |
| Order book at the end of the period, EUR thousand | 13,429 | 11,954 | 12.3 | 13,954 |
) Only interest-bearing part of restructuring debt included in comparison periods
*) All Componenta Group's restructuring programmes have ended prematurely in 2021
Balance sheet, financing and cash flow
At the end of the review period, the Group's invested capital stood at EUR 35.0 million (EUR 37.4 million), and the return on investment was 6.0% (5.5%). The return on equity was 3.5% (1.2%). The Group's equity ratio stood at 41.6% (39.1%) at the end of the review period. The improvement in the equity ratio was mainly due to the early repayment of Componenta Corporation's and Componenta Castings Oy's restructuring debt in 2021. The Group's equity was EUR 24.0 million (EUR 24.1 million). Its net gearing stood at 24.7% (5.2%) at the end of the review period. In the comparison period, net gearing was exceptionally low due to the liquid assets raised through a share issue at the end of 2020. In addition, only the
interest-bearing debt included in the restructuring debt was considered in the calculation of the net gearing ratio.
Componenta Group's total liabilities on 30 June 2022 stood at EUR 33.6 million (EUR 37.6 million). The significant change from the comparison period resulted from the early repayment of the restructuring debt in 2021. Long-term liabilities amounted to EUR 9.5 million (EUR 14.0 million), and short-term liabilities totalled EUR 24.1 million (EUR 23.6 million). The Group's liabilities included EUR 2.1 million (EUR 3.9 million) in loans from financial institutions. The Group's other debt items mainly consisted of working capital items and lease liabilities. The long-term and short-term liabilities also included EUR 1.3 million (EUR 3.5 million) in payment relief granted by the
Half-year Financial Report 1 January–30 June 2022
Tax Administration due to the COVID-19 pandemic on obligations that must be paid in accordance with separate payment schedules by 22 August 2023. The annual interest on the payment relief is 2.5%.
At the end of the review period, the Group's cash at bank and in hand totalled EUR 5.1 million (EUR 12.0 million). The funds of EUR 9.5 million raised through a rights issue improved liquidity at the end of the comparison period. These funds were used to repay restructuring debt during the 2021 financial year. The Group's liquidity remained at a good level in the review period. The Group had EUR 4.0 million in unused binding revolving credit facilities at the end of the review period. These are valid until November 2023. In addition, Componenta has access to a share subscription facility of USD 8 million.
The Group's net cash flow from operations in the review period was EUR 2.1 million (EUR 4.3 million). The change in cash flow is mainly due to seasonal fluctuation in working capital, which is typical for this line of business. The increase in working capital is also affected by the rising trend in the prices of materials and the fact that inventory levels are deliberately slightly higher than usual in case of weaker availability of raw materials. In addition, cash flow in 2022 has negatively affected by payments of EUR 0.7 million made in accordance with the payment schedule for the relief granted by the Tax Administration in 2020-2021 due to the COVID-19 pandemic.
Investoinnit
The Group's capital expenditure totalled EUR 0.8 million (EUR 1.0 million), including EUR 0.1 million (EUR 0.2 million) in lease liabilities recognised on the balance sheet. The Group's net cash from investing activities was EUR -0.7 million (EUR -0.7 million), which includes the Group's cash flow from capital expenditure in tangible and intangible assets.
Research and development activities
Componenta has no research and development costs because Componenta engages in contract manufacturing operations and has no products of its own.
Personnel
The Group's average number of personnel during the review period was 581 (559), or 634 (586) including leased employees. The Group's average number of personnel at the end of the review period was 587 (566), or 644 (596) including leased employees.
Risks and business-related uncertainties
The most significant risks related to Componenta's business operations are risks associated with the operating environment (competitive situation, prices, commodities and the environment), risks related to business operations (customers, suppliers, productivity, production, processes, labour market disruptions, contracts, product liability, personnel and information security) and financing risks (availability, liquidity, currency, interest rate and credit).
The availability of certain raw materials such as recycled steel, pig iron, structural steel, aluminium and energy at competitive prices is essential for the Group's business operations. The market prices for electricity remained at an exceptionally high level during the review period. Due to the COVID-19 pandemic, the recovery of the economy and the situation in Ukraine and Russia, uncertainties related to the availability of raw materials and other materials have increased in Componenta's operational activities. In addition, global challenges with the availability of certain components for customers may lead to production disruptions in our end customers' plants and thereby affect Componenta's sales volumes in the short term. To ensure the availability of raw materials and other materials, Componenta maintains active interaction with its suppliers, continuously updates its needs forecast and optimises its inventory levels to meet longer-term demand, closely monitors the situation of its suppliers and market changes and responds to these changes as necessary.
According to Componenta's estimate, the Group has no significant and immediate risk concentrations related to Russia and Ukraine among its customers or suppliers of goods. Componenta has no
Half-year Financial Report 1 January-30 June 2022
5
operations of its own in Russia or Ukraine. The war in Ukraine has had an impact on the general price development and availability of raw materials such as structural steel and pig iron. The war in Ukraine has had an indirect impact on the supply chains of Componenta's manufacturers of steel materials and wholesalers through the price development and availability of iron ore and coal, for example. A prolonged war in Ukraine can continue to have a negative impact on the financial market, sales volumes, the availability and price development of raw materials and energy and the availability of foreign labour, which increases uncertainty in terms of forecasts.
The cost risk associated with raw materials is mainly managed with price agreements to adjust product prices in accordance with changes in the general index of raw material prices. An increase in raw material prices may tie more cash than expected to working capital. In terms of commercial risks, future volumes may be weakened by customers switching to cheaper alternatives due to price competition.
Componenta is continuously monitoring the liquidity risk. Componenta's current revolving credit facilities will need to be renewed in November 2023. The Group also finances its operations through factoring arrangements for receivables. Any termination or non-renewal of factoring arrangements or revolving credit facilities can create uncertainties for Componenta's liquidity and going concern. However, these uncertainties can be mitigated, and it is the management's estimate that the future financing of operations does not involve significant uncertainties. This is discussed in more detail under "Accounting principles requiring management judgement".
The Group's liquidity was at a good level at the end of the review period. In addition, at the end of the review period, Componenta had EUR 4.0 million in unused binding revolving credit facilities and a share subscription facility of USD 8.0 million from GCF, an investor based in the United States. All Componenta Group's restructuring programmes were completed in 2021.
Flagging notifications
Componenta received no flagging notifications during the review period.
Resolutions of the Annual General Meeting and the Board of Directors
Componenta Corporation's Annual General Meeting (AGM) was held in Vantaa on 8 April 2022.
The AGM adopted the company's financial statements and consolidated financial statements and discharged the members of the Board of Directors and the President and CEO from liability for the 2021 financial period. In accordance with the Board of Directors' proposal, the AGM decided that no dividend be paid based on the balance sheet confirmed for the financial year that ended on 31 December 2021.
The AGM decided that the Board of Directors consists of four (4) members. The AGM re-elected Tomas Hedenborg, Anne Leskelä, Harri Suutari and Petteri Walldén as the members of the Board. It was decided that the Board's remuneration will not be changed. At its organisation meeting after the AGM, the Board of Directors elected Harri Suutari as Chair of the Board and Anne Leskelä as Vice Chair of the Board. The AGM elected the audit firm PricewaterhouseCoopers Oy as the company's auditor, with Ylva Eriksson, Authorised Public Accountant, as the principal auditor.
The AGM authorised the Board of Directors to decide on share issues in accordance with the Board's proposal.
Share issues can be executed by issuing new shares or transferring treasury shares. The number of shares to be issued or transferred under the authorisation may not exceed 942,263 shares, which corresponds to around 9.9% of all shares in the company. The authorisation is valid until the end of the next AGM, but no later than 30 June 2023. The authorisation will not supersede any previous share issue authorisations that remain valid and unused.
A stock exchange release about the resolutions of the AGM is available in full on the company's website.
Half-year Financial Report 1 January–30 June 2022
6
Half-year Financial Report 1 January–30 June 2022
Board of Directors and management
On 8 April 2022, Componenta's Annual General Meeting (AGM) confirmed, in accordance with the proposal of the Shareholders' Nomination Board, that the Board of Directors consisted of four (4) members. The AGM re-elected Harri Suutari, Anne Leskelä, Petteri Walldén and Tomas Hedenborg as the members of the Board. The Board members' term of office ends at the close of the next AGM. At its organisation meeting after the AGM, the Board of Directors elected Harri Suutari as Chair of the Board and Anne Leskelä as Vice Chair of the Board.
On 30 June 2022, the Group's Corporate Executive Team consisted of the following members: Sami Sivuranta, President and CEO; Marko Karppinen, CFO; Pasi Mäkinen, COO; and Hanna Seppänen, General Counsel.
Share capital and shares
The shares of Componenta Corporation are listed on the Nasdaq Helsinki. The average share price during the review period was EUR 3.05 (EUR 3.49). The lowest price was EUR 2.53 (EUR 2.95), and the highest was EUR 3.65 (EUR 4.60). The quoted price at the end of the review period was EUR 2.65 (EUR 3.34). The market value of all shares in the company at the end of the review period was EUR 25.2 million (EUR 31.7 million), and the volume of shares traded during the review period year was 11.6% (33.7%) of all shares in the company. Componenta Corporation's share capital was EUR 1.0 million (EUR 1.0 million) at the end of the review period. The total number of shares in the company was 9,517,813 (9,492,444) at the end of the review period. The company had 7,468 (8,129) shareholders at the end of the review period.
Alternative key financial ratios
Componenta publishes certain commonly used key financial ratios that can be derived from the IFRS financial statements. The calculation formulas for these key financial ratios are presented at the end of this report.
Helsinki 22 July 2022
COMPONENTA CORPORATION
Board of Directors
Componenta Corporation is an international technology company and Finland's leading contract manufacturer in the machine building industry. Sustainability and customers' needs are at the core of the company's extensive technology portfolio. Componenta produces components for its global customers, which are manufacturers of machinery and equipment. The company's shares are listed on the Nasdaq Helsinki. www.commonenta.com
Half-year financial report tables
Accounting principles
Componenta Corporation's half-year financial report for January–June 2022 has been prepared in line with IAS 34 Interim Financial Reporting, and should be read in conjunction with Componenta's financial statements for 2021, published on 16 March 2022. Componenta has applied the same accounting principles to its half-year financial report as it applied to its 2021 financial statements. The half-year financial report is unaudited.
Accounting principles requiring the management's judgement
When preparing the half-year financial report in accordance with the International Financial Reporting Standards, the management needs to make estimates and assumptions concerning the future. The estimates and assumptions that involve a significant risk of material changes in the carrying amounts of assets and liabilities during the next 12 months are presented below.
When preparing Componenta's half-year financial report, the management has used significant judgement when making assumptions about the company's ability to continue as a going concern. Uncertainties and risks are related to the going concern, but these can be mitigated at the management's discretion. Therefore, the going concern is not subject to any significant uncertainty in accordance with the International Financial Reporting Standards. The 2022 half-year financial report has been prepared based on the principle of going concern. When assessing the going concern principle, Componenta's management has considered the following aspects: During the 2020 financial year,
Componenta strengthened its sales operating model and sales resources for 2020–2022. Consequently, new deals were made during 2020–2022, which has been reflected in an increase in net sales. On 21 June 2021, Componenta entered into a three-year agreement on a share subscription facility of up to USD 8 million with Global Corporate Finance LLC, a company based in New York in the United States. The facility supports the company's financing for the next three years, enabling the company to focus on achieving its growth and profitability targets for the coming years. Componenta's unused euro-denominated revolving credit facilities of EUR 4.0 million will continue to be valid until 30 November 2023. This concerns both Componenta Manufacturing Oy and Componenta Castings Oy. It is the company's view that the Group also has access to debt financing from the market if necessary. The management has analysed the companies' cash flow forecasts for the next 12 months in accordance with various scenarios. To adjust its costs, Componenta has adjusted its operations through temporary layoffs when necessary due to changes in the order backlog.
In addition to assessing the going concern, the management has made other significant estimates and assumptions in determining the valuation of assets in the review period, such as investment properties, goodwill, tangible and intangible assets and inventories, as well as the realizability of deferred tax receivables and contingent liabilities. The management has also assessed trade receivables in terms of the impact of the COVID-19 pandemic and the war in Ukraine. The management has assessed the situation in terms of both the company's own industry and the overall economic situation. The assessment did not have a material impact on the credit loss provision at the end of the
Half-year Financial Report 1 January–30 June 2022
review period. Componenta regularly updates its credit loss provision. Componenta is continuously assessing the impact of the COVID-19 pandemic and the war in Ukraine on its financial reporting. Componenta closely monitors market development and its customers' situation and adjusts its operations accordingly.
The management has also assessed the recoverable amounts of assets and concluded that there are no indications of impairment, and that there is no need to write down assets. These estimates and assumptions involve risks and uncertainty, and it is therefore possible that these forecasts will change when the circumstances change or the pandemic or the war in Ukraine continues further, which may affect the recoverable amount of assets. More information about annual impairment testing is provided in the notes to the 2021 financial statements.
In addition, the management's judgement has been applied to determining the balance sheet value of a piece of equipment acquired by Componenta Manufacturing Oy and the related liability. The valuation of the asset and the financial liability at the end of the review period has been affected by an estimate of the operating hours of the equipment over the next 10 years, and by the effective interest method.
At the end of the review period, other liabilities under other non-interest-bearing liabilities included EUR 1.3 million in tax liabilities, for which the Tax Administration has granted a payment relief. In accordance with the payment relief, the company must pay the tax liability in equal instalments so that it will be fully repaid by August 2023. An interest rate of 2.5% applies to the debt covered by the payment relief.
Half-year Financial Report 1 January–30 June 2022
9
Consolidated income statement
| EUR thousand | Jan 1–Jun 30, 2022 | Jan 1–Jun 30, 2021 | Jan 1–Dec 31, 2021 |
|---|---|---|---|
| Net sales | 54,408 | 43,468 | 87,254 |
| Other operating income | 35 | 113 | 323 |
| Operating expenses | -50,615 | -40,291 | -82,618 |
| EBITDA | 3,827 | 3,290 | 4,959 |
| % of net sales | 7.0% | 7.6% | 5.7% |
| Depreciation, amortization and write-downs | -2,779 | -2,932 | -4,946 |
| Operating result | 1,049 | 358 | 13 |
| % of net sales | 1.9% | 0.8% | 0.0% |
| Financial income and expenses | -720 | -129 | -418 |
| Result after financial items | 329 | 229 | -405 |
| % of net sales | 0.6% | 0.5% | -0.5% |
| Income taxes | 85 | -83 | 0 |
| Net result for the financial period | 415 | 146 | -405 |
| Allocation of net result for the period | |||
| To equity holders of the parent | 415 | 146 | -405 |
| Earnings per share calculated on result attributable to the shareholders of the parent company | |||
| - Basic earnings per share, EUR | 0.04 | 0.02 | -0.04 |
| - Diluted earnings per share, EUR | 0.04 | 0.02 | -0.04 |
Consolidated statement of comprehensive income
| EUR thousand | Jan 1–Jun 30, 2022 | Jan 1–Jun 30, 2021 | Jan 1–Dec 31, 2021 |
|---|---|---|---|
| Net result | 415 | 146 | -405 |
| Other comprehensive income | |||
| Items that will not be reclassified subsequently to profit or loss | |||
| Revaluation of buildings and land areas | 0 | 0 | -247 |
| Other comprehensive income total | 0 | 0 | -247 |
| Income tax on other comprehensive income | 0 | 0 | 49 |
| Other comprehensive income, net of tax | 0 | 0 | -198 |
| Total comprehensive income | 415 | 146 | -602 |
| Allocation of total comprehensive income | |||
| To equity holders of the parent | 415 | 146 | -602 |
Half-year Financial Report 1 January–30 June 2022
Consolidated statement of financial position
| EUR thousand | Jun 30, 2022 | Jun 30, 2021 | Dec 31, 2021 |
|---|---|---|---|
| Assets | |||
| Non-current assets | |||
| Intangible assets | 1,587 | 1,892 | 1,796 |
| Goodwill | 3,225 | 3,225 | 3,225 |
| Tangible assets | 26,977 | 29,678 | 28,332 |
| Investment properties | 17 | 17 | 17 |
| Receivables | 532 | 539 | 532 |
| Total non-current assets | 32,338 | 35,351 | 33,902 |
| Current assets | |||
| Inventories | 14,059 | 10,417 | 12,187 |
| Trade and other receivables | 6,011 | 4,030 | 4,159 |
| Cash and cash equivalents | 5,110 | 11,983 | 5,231 |
| Total current receivables | 25,180 | 26,430 | 21,577 |
| Total assets | 57,518 | 61,781 | 55,479 |
| EUR thousand | Jun 30, 2022 | Jun 30, 2021 | Dec 31, 2021 |
| Shareholders' equity and liabilities | |||
| Shareholders' equity | |||
| Share capital | 1,000 | 1,000 | 1,000 |
| Other equity | 22,938 | 23,136 | 22,458 |
| Equity attributable to equity holders of the parent company | 23,938 | 24,136 | 23,458 |
| Shareholders' equity | 23,938 | 24,136 | 23,458 |
| Liabilities | |||
| Non-current liabilities | |||
| Interest-bearing liabilities | 8,458 | 10,178 | 9,137 |
| Interest free liabilities and capital loans | 899 | 3,523 | 1,117 |
| Provisions | 14 | 14 | 14 |
| Deferred tax liabilities | 129 | 347 | 214 |
| Total non-current liabilities | 9,500 | 14,062 | 10,482 |
| Current liabilities | |||
| Interest bearing liabilities | 2,576 | 3,068 | 2,808 |
| Interest free liabilities | 21,149 | 19,973 | 18,385 |
| Provisions | 354 | 543 | 347 |
| Total current liabilities | 24,079 | 23,584 | 21,540 |
| Total liabilities | 33,580 | 37,646 | 32,021 |
| Total shareholders' equity and liabilities | 57,518 | 61,781 | 55,479 |
Half-year Financial Report 1 January–30 June 2022
Condensed consolidated cash flow statement
EUR thousand
Jan 1-Jun 30, 2022
Jan 1-Jun 30, 2021
Jan 1-Dec 31, 2021
Cash flow from operating activities
| Result after financial items | 329 | 229 | -405 |
| --- | --- | --- | --- |
| Depreciation, amortization and write-downs | 2,779 | 2,932 | 4,946 |
| Net financial income and expenses | 720 | 129 | 418 |
| Other income and expenses, adjustments to cash flow | -508 | -876 | -738 |
| Change in net working capital | -556 | 2,383 | -449 |
| Cash flow from operations before financing and income taxes | 2,763 | 4,797 | 3,771 |
| Interest received and paid and dividends received | -673 | -468 | -934 |
Net cash flow from operating activities
| 2,090 | 4,329 | 2,837 |
| --- | --- | --- |
Cash flow from investing activities
| Capital expenditure in tangible and intangible assets | -747 | -715 | -1,194 |
| --- | --- | --- | --- |
| Acquisitions | - | -17 | - |
Net cash flow from investing activities
| -747 | -732 | -1,194 |
| --- | --- | --- |
Cash flow from financing activities
| Repayment of lease liabilities | -790 | -765 | -1,536 |
| --- | --- | --- | --- |
| Share issue | - | -577 | -577 |
| Repayment of current loans | -674 | -684 | -1,362 |
| Repayment of non-current loans and other changes | - | -6,340 | -9,689 |
Net cash flow from financing activities
| -1,464 | -8,366 | -13,163 |
| --- | --- | --- |
Change in liquid assets
| -121 | -4,769 | -11,521 |
| --- | --- | --- |
Cash and cash equivalents at the beginning of the period
| 5,231 | 16,752 | 16,752 |
| --- | --- | --- |
Cash and cash equivalents at the period end
| 5,110 | 11,983 | 5,231 |
| --- | --- | --- |
Half-year Financial Report 1 January–30 June 2022
12
Statement of changes in consolidated shareholders' equity
| EUR thousand | Share capital | Unrestricted equity reserve | Revaluation of buildings and land areas | Other reserves | Retained earnings | Share-holders' equity total |
|---|---|---|---|---|---|---|
| Shareholders' equity Jan 1, 2022 | 1,000 | 16,522 | 382 | 2,507 | 3,047 | 23,458 |
| Net result | 415 | 415 | ||||
| Total comprehensive income | 0 | 0 | 0 | 0 | 415 | 415 |
| Transaction with owners: | ||||||
| Option and share-based compensation | 66 | 66 | ||||
| Transactions with owners, total | 0 | 0 | 0 | 0 | 66 | 66 |
| Shareholders' equity Jun 30, 2022 | 1,000 | 16,522 | 382 | 2,507 | 3,527 | 23,938 |
| EUR thousand | Share capital | Unrestricted equity reserve | Revaluation of buildings and land areas | Other reserves | Retained earnings | Share-holders' equity total |
| --- | --- | --- | --- | --- | --- | --- |
| Shareholders' equity Jan 1, 2021 | 1,000 | 16,522 | 580 | 2,507 | 3,262 | 23,871 |
| Net result | 146 | 146 | ||||
| Total comprehensive income | 0 | 0 | 0 | 0 | 146 | 146 |
| Transaction with owners: | ||||||
| Option and share-based compensation | 119 | 119 | ||||
| Transactions with owners, total | 0 | 0 | 0 | 0 | 119 | 119 |
| Shareholders' equity Jun 30, 2021 | 1,000 | 16,522 | 580 | 2,507 | 3,527 | 24,136 |
Group development
Group development by quarter
| EUR thousand | Q2/22 | Q1/22 | Q4/21 | Q3/21 | Q2/21 | Q1/21 |
|---|---|---|---|---|---|---|
| Net sales | 28,896 | 25,512 | 25,260 | 18,526 | 23,085 | 20,384 |
| EBITDA | 2,374 | 1,453 | 1,402 | 267 | 1,779 | 1,510 |
| Operating result | 999 | 50 | 797 | -1,142 | 317 | 41 |
| Net financial items | -334 | -386 | 47 | -336 | -363 | 235 |
| Result after financial items | 665 | -336 | 844 | -1,478 | -47 | 275 |
Order book at period end
| EUR thousand | Q2/22 | Q1/22 | Q4/21 | Q3/21 | Q2/21 | Q1/21 |
|---|---|---|---|---|---|---|
| Order book | 13,426 | 16,193 | 13,954 | 16,049 | 11,954 | 11,862 |
Half-year Financial Report 1 January–30 June 2022
Net sales
Componenta Corporation is an international technology group and Finland's leading contract manufacturer in the engineering industry. Componenta and its predecessors have more than 200 years of experience in metal processing, method design, product development co-operation and various manufacturing methods, as well as their development. The group's operational functions are located in Finland. Componenta's technology portfolio is extensive. The group manufactures both cast and machined metal components as well as forgings, pipe products and plate sections. Componenta's business model is built on long-term customer relationships. The group's customers are global machine and equipment manufacturers. Componenta's production is focused on serving the customer flexibly, especially in short and medium-sized production series. The wide range of production units covers sizes ranging from hundreds of grams to thousands of kilograms, volumes available from pieces to tens of thousands of series, and many different material options.
Net sales by market area
| EUR thousand | Jan 1–Jun 30, 2022 | Jan 1–Jun 30, 2021 | Jan 1–Dec 31, 2021 |
|---|---|---|---|
| Finland | 43,006 | 34,713 | 69,448 |
| Sweden | 6,118 | 5,796 | 11,194 |
| Germany | 2,060 | 1,146 | 2,269 |
| Other European countries | 2,717 | 1,590 | 3,873 |
| Other countries | 376 | 119 | 243 |
| Rental income | 138 | 113 | 241 |
| Internal items/eliminations | -7 | -9 | -13 |
| Total | 54,408 | 43,468 | 87,254 |
Country-specific net sales reflect the destination where goods have been delivered.
Quarterly development of net sales by market area
| EUR thousand | Q2/22 | Q1/22 | Q4/21 | Q3/21 | Q2/21 | Q1/21 |
|---|---|---|---|---|---|---|
| Finland | 23,035 | 20,109 | 19,994 | 14,869 | 18,617 | 16,209 |
| Sweden | 3,243 | 2,875 | 3,139 | 2,259 | 3,030 | 2,766 |
| Germany | 1,169 | 891 | 685 | 437 | 555 | 592 |
| Other European countries | 1,445 | 1,272 | 1,342 | 941 | 822 | 768 |
| Other countries | 32 | 344 | 93 | 31 | 65 | 54 |
| Total | 28,924 | 25,491 | 25,252 | 18,537 | 23,089 | 20,389 |
Net sales by business area
| % | Jan 1–Jun 30, 2022 | Jan 1–Jun 30, 2021 | Jan 1–Dec 31, 2021 |
|---|---|---|---|
| Machine building | 48 | 44 | 45 |
| Agricultural machinery | 30 | 27 | 28 |
| Forestry machinery | 7 | 8 | 8 |
| Energy industry | 8 | 8 | 8 |
| Defence equipment industry | 1 | 6 | 4 |
| Other industries | 6 | 7 | 7 |
| Total | 100 | 100 | 100 |
Half-year Financial Report 1 January–30 June 2022
Net sales by customer
Componenta has one significant customer, which share of the net sales is over 10%. The customer's share of the Group net sales is 28.0% (24.1%).
Disaggregation of revenue from contracts with customers
| Timing of revenue recognition, EUR thousand | Jan 1–Jun 30, 2022 | Jan 1–Jun 30, 2021 | Jan 1–Dec 31, 2021 |
|---|---|---|---|
| At a point in time | 54,408 | 43,468 | 87,254 |
| Over time | 0 | 0 | 0 |
| Total | 54,408 | 43,468 | 87,254 |
Changes in tangible assets
| EUR thousand | Jan 1–Jun 30, 2022 | Jan 1–Jun 30, 2021 | Jan 1–Dec 31, 2021 |
|---|---|---|---|
| Acquisition cost at the beginning of the period | 133,345 | 130,970 | 130,970 |
| Additions | 815 | 726 | 1,181 |
| Revaluation of buildings and land areas | 357 | 551 | 574 |
| Disposals and transfers between items | -209 | -149 | 621 |
| Acquisition cost at the end of the period | 134,308 | 132,097 | 133,345 |
| Accumulated depreciation at the beginning of the period | -105,013 | -99,724 | -99,724 |
| Depreciations, amortizations and write-downs during the period | -2,318 | -2,696 | -5,290 |
| Accumulated depreciation at the end of the period | -107,331 | -102,419 | -105,013 |
| Carrying amount at the end of the period | 26,977 | 29,678 | 28,332 |
Changes in intangible assets
| EUR thousand | Jan 1–Jun 30, 2022 | Jan 1–Jun 30, 2021 | Jan 1–Dec 31, 2021 |
|---|---|---|---|
| Acquisition cost at the beginning of the period | 21,590 | 21,263 | 21,263 |
| Additions | 0 | 26 | 67 |
| Disposals and transfers between items | 51 | 143 | 260 |
| Acquisition cost at the end of the period | 21,641 | 21,432 | 21,590 |
| Accumulated depreciation at the beginning of the period | -19,794 | -19,302 | -19,302 |
| Depreciations, amortizations and write-downs during the period | -259 | -238 | -493 |
| Accumulated depreciation at the end of the period | -20,053 | -19,539 | -19,794 |
| Carrying amount at the end of the period | 1,587 | 1,892 | 1,796 |
Goodwill
| EUR thousand | Jan 1–Jun 30, 2022 | Jan 1–Jun 30, 2021 | Jan 1–Dec 31, 2021 |
|---|---|---|---|
| Acquisition cost at the beginning of the period | 3,225 | 3,225 | 3,225 |
| Carrying amount at the end of the period | 3,225 | 3,225 | 3,225 |
Half-year Financial Report 1 January–30 June 2022
Changes in right-of-use assets
| EUR thousand | Jan 1–Jun 31, 2022 | Jan 1–Jun 31, 2021 | Jan 1–Dec 31, 2021 |
|---|---|---|---|
| Acquisition cost at the beginning of the period | 9,015 | 9,976 | 9,721 |
| Additions | 67 | 36 | 66 |
| Transfers between items | 459 | 580 | 1,221 |
| Depreciation | -964 | -1,004 | -1,992 |
| Carrying amount at the end of the period | 8,577 | 9,588 | 9,015 |
Values of financial assets and liabilities
| EUR thousand, Jun 30, 2022 | Financial assets and liabilities at fair value through profit and loss | Financial assets and liabilities measured at amortised cost | Investments measured at fair value through other comprehensive income | Lease liabilities | Total |
|---|---|---|---|---|---|
| Non-current assets | |||||
| Other receivables | 263 | 263 | |||
| Current assets | |||||
| Cash and cash equivalents | 5,110 | 5,110 | |||
| Accounts receivables | 3,890 | 3,890 | |||
| Total financial assets | 9,263 | 9,263 |
Non-current liabilities
| Loans from financial institutions | 1,010 | 1,010 | |
|---|---|---|---|
| Lease liabilities | 7,448 | 7,448 | |
| Other loans | 0 | 0 | |
| Trade payables and advances received | 366 | 366 | |
| Interest-bearing restructuring debts | 0 | 0 | |
| Non-interest-bearing restructuring debts | 0 | 0 |
Current liabilities
| Loans from financial institutions | 1,086 | 1,086 | |
|---|---|---|---|
| Lease liabilities | 1,432 | 1,432 | |
| Other loans | 58 | 58 | |
| Trade payables and advances received | 10,260 | 10,260 | |
| Interest-bearing restructuring debts | 0 | 0 | |
| Non-interest-bearing restructuring debts | 0 | 0 | |
| Total financial liabilities | 12,781 | 8,880 | 21,661 |
| --- | --- | --- | --- |
Half-year Financial Report 1 January–30 June 2022
| EUR thousand, Jun 30, 2021 | Financial assets and liabilities at fair value through profit and loss | Financial assets and liabilities measured at amortised cost | Investments measured at fair value through other comprehensive income | Lease liabilities | Total |
|---|---|---|---|---|---|
| Non-current assets | |||||
| Other receivables | 270 | 270 | |||
| Current assets | |||||
| Cash and cash equivalents | 11,983 | 11,983 | |||
| Accounts receivables | 2,385 | 2,385 | |||
| Total financial assets | 14,638 | 14,638 | |||
| Non-current liabilities | |||||
| --- | --- | --- | |||
| Loans from financial institutions | 2,082 | 2,082 | |||
| Lease liabilities | 7,641 7,641 | ||||
| Other loans | 58 | 58 | |||
| Trade payables and advances received | 1,327 | 1,327 | |||
| Interest-bearing restructuring debts | 397 | 397 | |||
| Non-interest-bearing restructuring debts | 2,196 | 2,196 | |||
| Current liabilities | |||||
| Loans from financial institutions | 1,241 | 1,241 | |||
| Lease liabilities | 1,568 1,568 | ||||
| Other loans | 83 | 83 | |||
| Trade payables and advances received | 7,419 | 7,419 | |||
| Interest-bearing restructuring debts | 176 | 176 | |||
| Non-interest-bearing restructuring debts | 838 | 838 | |||
| Total financial liabilities | 15,817 | 9,209 25,026 |
The fair values of financial assets and liabilities are materially similar to their carrying amounts.
The Group's financial assets are initially classified in the following categories: assets measured at amortised cost, at fair value through profit and loss or at fair value through other comprehensive income. When assessing the expected impairment for financial assets measured at amortised cost, the expected credit losses are measured and recognised based on aging classification. Financial liabilities are classified in the following categories: financial liabilities at fair value through profit and loss, lease liabilities and financial liabilities at amortised cost.
Componenta has also assessed the impact of the COVID-19-pandemic, war in Ukraine and the rise in
interest rates regarding the most significant financial risks. The factors in question are not estimated to have a significant effect to Componenta's financial risks.
Loans are initially recognised at fair value and valued thereafter at amortised cost using the effective interest rate method. Substantial transaction costs are taken into account when calculating the acquisition cost.
Cash and cash equivalents include cash in hand and cash in bank accounts as well as short-term bank deposits.
The Group does not have derivative financial instruments on which hedge accounting would be applied.
Half-year Financial Report 1 January–30 June 2022
Contingent liabilities
| EUR thousand | Jun 30, 2022 | Jun 30, 2021 | Dec 31,2021 |
|---|---|---|---|
| Real-estate mortgages | |||
| For own debts | 0 | 3,150 | 600 |
| Business mortgages | |||
| For own debts | 12,400 | 12,400 | 12,400 |
| Pledges | |||
| For own debts | 7,800 | 7,800 | 7,800 |
| Other leasing commitments | 213 | 110 | 150 |
| Other commitments | 193 | 245 | 198 |
| Total | 20,606 | 23,705 | 21,149 |
| Secured liabilities | Jun 30, 2022 | Jun 30, 2021 | Dec 31,2021 |
| --- | --- | --- | --- |
| EUR thousand | |||
| Liabilities secured with pledges, real estate or business mortgages | |||
| Interest-bearing restructuring debts | 0 | 473 | 0 |
| Loans from financial institutions | 2,096 | 3,322 | 2,712 |
| Total | 2,096 | 3,795 | 2,712 |
Componenta Corporation owns 3.6% of the shares of Majakka Voima Oy. Majakka Voima Oy owns Voimaosakeyhtiö SF's shares. Voimaosakeyhtiö SF is the main owner of Fennovoima Oy. Componenta has not participated in further funding of Majakka Voima Oy after 2013 and has fulfilled its obligations towards Majakka Voima Oy. Componenta has written down Majakka Voima Oy's shares in its accounting completely in 2016. Voimaosakeyhtiö
SF and some of its shareholders have approached Majakka Voima Oy with claims based on Voimaosakeyhtiö SF's shareholder agreement and related financial commitments. According to Componenta's assessment, it is unlikely that there are significant financial consequences to Componenta, as a result of which Componenta's figures for the review period do not include provisions or contingent liabilities related to this matter.
Related party transactions
Componenta Group's related parties include the parent company, subsidiaries, company management, Board of Directors and management's and Board of Directors' related parties. The company management consists of the CEO and Executive Board. Management's and Board of Directors' related parties consist of their immediate family and controlled companies.
Componenta did not have any abnormal transactions with related parties during the reference period in 2022 nor during the reference period in 2021. Intra-group transactions have been eliminated from the Group's financial figures. Salaries and remunerations paid to the management are presented annually in the consolidated financial statements.
Half-year Financial Report 1 January–30 June 2022
Key figures
| Jun 30, 2022 | Jun 30, 2021 | Dec 31, 2021 | |
|---|---|---|---|
| Equity ratio, % | 41.6 | 39.1 | 42.3 |
| Equity per share, EUR | 2.52 | 2.54 | 2.46 |
| Invested capital at period end, EUR thousand | 34,973 | 37,384 | 35,402 |
| Return on investment, % | 6.0 | 5.5 | 3.2 |
| Return on equity, % | 3.5 | 1.2 | -1.7 |
| Net interest-bearing debt, EUR thousand | 5,924 | 1,263 | 6,714 |
| Net gearing, % | 24.7 | 5.2 | 28.6 |
| Order book, EUR thousand | 13,429 | 11,954 | 13,954 |
| Capital expenditure excl. lease liabilities, EUR thousand | 748 | 715 | 1,183 |
| Capital expenditure incl. lease liabilities, EUR thousand | 815 | 957 | 1,249 |
| Capital expenditure incl. lease liabilities, % of net sales | 1.5 | 2.2 | 1.4 |
| Average number of personnel during the period | 581 | 559 | 562 |
| Average number of personnel during the period, incl. leased personnel | 634 | 586 | 592 |
| Number of personnel at period end | 587 | 566 | 570 |
| Number of personnel at period end, incl. leased personnel | 644 | 596 | 612 |
| Share of export and foreign activities in net sales, % | 20.7 | 19.9 | 20.1 |
| Contingent liabilities, EUR thousand | 20,606 | 23,705 | 21,149 |
| Per Share Data | Jun 30, 2022 | Jun 30, 2021 | Dec 31, 2021 |
| --- | --- | --- | --- |
| Basic earnings per share, EUR | 0.04 | 0.02 | -0.04 |
| Diluted earnings per share, EUR | 0.04 | 0.02 | -0.04 |
| Cash flow per share, EUR | 0.14 | 0.46 | -0.04 |
Half-year Financial Report 1 January–30 June 2022
19
Calculation of key financial ratios
| Return on equity, % (ROE) | = Profit (Group) after financial items – income taxes x 100
Shareholders' equity without preferred capital notes + non-controlling interest (starting & closing balance average) |
| --- | --- |
| Return on investment, % (ROI) | = Profit (Group) after financial items + interest and other financial expenses x 100
Shareholders' equity + interest bearing liabilities (starting & closing balance average) |
| Equity ratio, % | = Shareholders' equity, preferred capital notes excluded + non-controlling interest x 100
Balance sheet total - advances received |
| Basic earnings per share, EUR (EPS) | = Profit after financial items – income taxes +/- non-controlling interest
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 outstanding.
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 (CEPS) | = Net cash flow from operating activities
Average number of shares during the financial period |
| Average trading price, EUR | = Trading volume
Number of shares traded during the financial period |
| Equity per share, EUR | = Shareholders' equity, preferred capital notes excluded
Number of shares at period end |
| Dividend per share, EUR | = Dividend
Number of shares at period end |
| Payout ratio, % | = Dividend x 100
Earnings (as in Basic earnings per share) |
| Effective dividend yield, % | = Dividend per share x 100
Market share price at period end |
| Market capitalization, EUR | = Number of shares x market share price at period end |
| P/E multiple | = Market share price at period end
Basic earnings per share |
| Net interest bearing debt, EUR | = 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 |
Half-year Financial Report 1 January–30 June 2022
20
COMPONENTA
Contacts
Componenta Corporation, Head Office
Address: Teknobulevardi 7, FI-01530 Vantaa, Finland
Phone: +358 10,403 00
E-mail: [email protected]
www.commonenta.com