SinterCast Results April-June 2009
(Thomson Reuters ONE) - * Revenue for period: SEK 5.3 million (SEK 6.0 million). Year-to-date: SEK 9.3 million (SEK 11.4 million) * Operating result: SEK -1.0 million (SEK -1.9 million). Year-to-date: SEK -3.7 million (SEK -4.1 million) * Earning/share: SEK 0.4 per share (SEK -0.1 per share). Year-to-date: SEK -2.1 per share (SEK 3.3 per share) * Cashflow: SEK -0.3 million (SEK -1.5 million). Year-to-date: SEK 0.1 million (SEK -4.6 million) * Events after balance sheet date: New rights issue and option programme proposed to Extraordinary meeting * Series production increases at Dashiang Precision foundry in China as new products come on-stream * First ever SinterCast-CGI production trial in India to begin during August at the DCM Engineering foundry Second quarter volumes indicate that series production has stabilised. Opportunities remain for new installation revenue and series production announcements during the second half of 2009Current Production and OutlookSeries production for the second quarter ran at an annualised rate ofapproximately 400,000 Engine Equivalents (20,000 tonnes). Thisvolume is effectively the same as the first quarter of 2009 andprovides an indication that the underlying automotive demand hasstabilised. The production volume during the first half of 2009 isdown from the fourth quarter 2008 level of 625,000 Engine Equivalents(31,250 tonnes), but this decrease directly parallels the overallreductions in the wider automotive industry and is not indicative ofany specific reductions related to the SinterCast technology or toCGI. Although the production seems to have stabilised, the Companyjudges that it is prudent not to anticipate any significant recoveryin automotive sales during the balance of 2009, or indeed throughmuch of 2010. Any near-term increases in the production volume wouldtherefore primarily depend upon the start of production of newSinterCast-CGI products rather than a recovery of existingprogrammes.During the period, a Mini-System 2000 process control system wasinstalled at the Luitpoldhütte foundry in Germany. Luitpoldhütte isa global leader in the production of complex heavy section ironcastings for the agriculture, off-highway, construction andindustrial power sectors, and a member of the international ConcernTractor Plants (CTP) group. The long-term technology supplyagreement with Luitpoldhütte broadens SinterCast's footprint in theGerman foundry industry and significantly improves SinterCast'sability to supply the CGI needs of the off-road sector. The secondquarter also resulted in a further hardware upgrade/expansion at theTupy foundry in Brazil, in anticipation of increased CGI productionactivities. Coupled with revenue received from the intensified trialactivities earlier in the year, the Luitpoldhütte installation andthe Tupy expansion resulted in an effectively neutral cashflow resultfor the second quarter, amounting to SEK -0.3 million.Despite the economic downturn, several positive developments areunderway in the market. In China, production of exhaust componentsat the Dashiang Precision foundry has increased as new CGI productshave successfully come on-stream and ramped-up. SinterCast is alsoscheduled to begin its first ever CGI production trial in Indiaduring August, at the DCM Engineering foundry, the largestindependent cylinder block foundry in India. SinterCast-CGIprototype components will be cast for several OEMs in the domesticmarket. Also, following a delay of several months, it is expectedthat the extended production trial that was initiated during 2008will resume during the third quarter. SinterCast continues tosupport ongoing discussions for new installations and remainsoptimistic for additional installation revenue during the second halfof 2009. The Company also anticipates the launch of the firstSinterCast-CGI V-diesel engine for the North American passengervehicle sector during the second half of the year.Internally, the development of the new System 3000 process controlsystem is proceeding according to schedule and is planned for marketlaunch during the autumn. The System 3000 incorporates a suite ofcomprehensive advances in the functionality of the hardware, softwareand the consumable Sampling Cup.Based on the apparent stabilisation of the current productionprogrammes, and the expected market recovery during SinterCast's fiveyear planning horizon, the five year outlook remains unchanged fromthe outlook published as of 31 March 2009. The current outlook issummarised as follows: Approximate Annual Production Potential and Revenue 30 June 2009 31 March 2009Activity KEQVS* MSEK/yr** KEQVS* MSEK/yr**Current Series 400 9 400 9Production1Potential Mature Volume2 1,000 23 1,000 23Production Orders 500 12 500 12Secured3Development Pipeline4 2,600 60 2,600 60Near-term Market 4,100 94 4,100 94Opportunity5Notes: 1. Current annualised production rate 2. Annualised potential mature volume of Current Series Production (Item 1 above) when fully ramped-up 3. Annualised mature volume of programmes for which SinterCast's foundry customers have received production orders, but have not yet started series production 4. Annualised mature volume of development programmes that SinterCast is currently supporting, but have not yet been awarded as series production orders 5. Total Near-term Market Opportunity (sum of items 2, 3 and 4) * KEQVS: Thousands of Engine Equivalents ** Assumes 23 SEK/Engine Equivalent on 30 June 2009 and 23 SEK/Engine Equivalent on 31 March 2009Financial SummaryRevenueThe revenue for the SinterCast Group relates primarily to income fromequipment (sales and leases), series production and engineeringservice. During April-June 2009 revenue decreased by 12% compared tothe same period 2008, to SEK 5.3 million (SEK 6.0 million). Seriesproduction revenue amounted to SEK 3.1 million, representing a 37%decrease compared to 2008. Equipment revenue for the period was SEK1.7 million (SEK 0.6 million), primarily related to the Mini-System2000 installation at the Luitpoldhütte foundry in Germany and thehardware upgrade/expansion at the Tupy foundry in Brazil.During January-June, revenue decreased by 18 % to SEK 9.3 million(SEK 11.4 million). The decreased revenue for the period resultsmainly from the decreased series production among foundry customers.A total of 20,600 (27,500) Sampling Cups were sold during the period.Equipment revenue for January-June 2009 exceeded the equipmentrevenue for the same period during 2008.Revenue Breakdown April-June January-June 2009 2008 2009 2008Number of Sampling Cups shipped 9,300 16,500 20,600 27,500Equipment 1 1.7 0.6 2.0 1.8Series Production 2 3.1 4.9 6.4 8.6Engineering Service 3 0.4 0.4 0.8 0.9Other 0.1 0.1 0.1 0.1Total 5.3 6.0 9.3 11.4(Amounts in SEK million if not otherwisestated)Notes: 1. includes revenue from System 2000 sales and leases, sales of the Mini-System 2000 and spare parts 2. includes revenue from production fees, consumables and software licence fees 3. includes revenue from technical support, on-site trials and sales of test piecesResultThe April-June 2009 operating result of SEK -1.0 million is SEK 0.9million higher than the same period 2008, primarily affected byreduced gross margins of SEK -0.3 Million, cost reductions of SEK-0.7 million and income from capitalised development of SEK 0.5million.The result for the April-June 2009 period amounted to SEK 2.0 million(SEK -0.3 million), primarily related to the revaluation of thedeferred tax asset, SEK 2.5 million.The operating result for the January-June 2009 period amounted to SEK-3.7 million and is SEK 0.4 million higher than the same period 2008.The gross margin was reduced by SEK 1.6 million to SEK 5.7 million(SEK 7.3 million), which was compensated by cost reductions and byincome from the capitalised development. The cost reductions areprimarily related to salaries, travel and external consultants,stemming from the Company's pro-active liquidity protection plan.The result for the period amounted to SEK -11.7 million (SEK 18.5million), primarily related to the revaluation of the deferred taxasset, SEK -8.0 million.Result Summary April-June January-June 2009 2008 2009 2008Operating Result -1.0 -1.9 -3.7 -4.1Result for the period 2.0 -0.3 -11.7 18.5Result after tax per share (SEK) 0.4 -0.1 -2.1 3.3(Amounts in SEK million if not otherwisestated)Deferred Tax AssetSinterCast calculates its estimated future taxable profit fromsecured production orders on a quarterly basis, in order to determinethe valuation of its deferred tax asset. As of 31 December 2008,this calculation resulted in SEK 70.1 million, representing 11.8% ofthe Company's total carried-forward tax losses, being used as thebasis of the deferred tax asset calculation. However, the globaleconomic crisis has resulted in a reduced forecast of securedproduction orders, and a corresponding reduction of thecarried-forward tax losses being taken into consideration. As of 30June 2009, SEK 39.9 million (6.7%) of SinterCast's totalcarried-forward tax losses have been used as the basis of the updatedcalculation, resulting in SEK 10.5 million being capitalised as adeferred tax asset. The Company will continue to review its forecaston a quarterly basis, and to capitalise additional tax assets as newproduction orders are confirmed.Deferred Tax Asset April-June January-June 2009 2008 2009 2008Estimated future taxable profit 39.9 80.0 39.9 80.0Change in carried-forward tax loss taken 9.6 5.0 -30.2 80.0into considerationDeferred tax asset 10.5 22.4 10.5 22.4Tax result 2.5 1.4 -8.0 22.4(Amounts in SEK million if not otherwisestated)Employee Stock Option ProgrammeAs of 30 June 2009, the cost of the existing 2006-2010 employee stockoption programme was calculated at a total amount of SEK 3.2 million(SEK 4.3 million as of 30 June 2008), based on a closing share priceof SEK 30.4 on 30 June 2009 (SEK 121). During 2009, SEK 0.5 million(SEK 0.8 million) was accounted for as costs related to the optionprogramme. The Board of Directors has also proposed a new employeestock option programme, to be decided upon by an ExtraordinaryGeneral meeting of the shareholders on 20 August 2009. In the eventthat the proposed new option programme is approved, all employeeswill automatically forfeit any options held in the 2006-2010programme, such that there will only be one active programme at theoutset of the proposed new option programme.Cashflow, Liquidity and InvestmentsThe April-June 2009 cashflow result was SEK -0.3 million (SEK -1.5million), providing a Group liquidity of SEK 9.1 million on 30 June2009 (SEK 11.7 million). The January-June 2009 cashflow result wasSEK 0.1 million (SEK -4.6 million). The liquidity was primarilyaffected by a bank loan received from Sörmlands Sparbank in theamount of 3.0 MSEK million, an operational loss of SEK -2.8 million(SEK -3.0 Million) and a decrease in working capital of SEK 0.6million (SEK -1.6 Million). The bank loan is conditional and will bereviewed during December 2009. Investments during the periodamounted to SEK 0.7 million (SEK 0.0 million). Cashflow Summary April-June January-June 2009 2008 2009 2008 Cashflow from operating activities -1.2 -1.3 -2.8 -3.0 Cashflow from working capital 1.6 -0.2 0.6 -1.6 Cashflow from investment activities -0.7 0.0 -0.7 0.0 Cashflow from financing activities - - 3.0 - Cashflow total -0.3 -1.5 0.1 -4.6 Liquidity 9.1 11.7 9.1 11.7 Investments 0.6 0.0 0.7 0.0 (Amounts in SEK million if not otherwise stated)Risks and Uncertainty Factors; Global Economic CrisisMarket DevelopmentThe main uncertainty factor for SinterCast is the timing of the CGImarket ramp-up, which primarily depends on the global economy for newvehicle sales and on the individual sales success of the vehiclesequipped with SinterCast-CGI components. The economic conditionsfacing the global foundry and automotive industries have resulted insignificant reductions in demand in both the passenger vehicle andcommercial vehicle sectors, causing automotive OEMs to reduceproduction and, in some cases, delay production launches. Theoverall decline in the automotive market has resulted in a reductionof SinterCast's near-term market opportunity calculation from a peakof 5.7 million Engine Equivalents on 30 June 2008 to the currentvalue of 4.1 million Engine Equivalents. This reduction ofapproximately 28% is less than the overall automotive market declineof 40~60% during the same period, primarily because the launch of newSinterCast-CGI components have provided incremental volumes. It isalso noted that SinterCast's production of components other thanautomotive cylinder blocks and heads has not decreased assignificantly as the core cylinder block and head sector, thusproviding a compensating effect on the overall series productionvolume. While SinterCast continues to support new productdevelopment activities, and anticipates new production launches andinstallation revenue during 2009, the ultimate effect of the globaleconomic recession cannot yet be fully quantified.LiquiditySinterCast regularly monitors its cash position with reference tomarket forecasts and expense budgets, and has implemented apro-active liquidity protection plan that has included personnelreductions. While the Company believes that new installationopportunities can provide cash injections to reinforce the liquidity,and that new series production launches can provide a positivecontribution to production volumes and revenues, the timing of theoverall recovery in the automotive and foundry industries remainsuncertain. The current series production volume of approximately400,000 Engine Equivalents is insufficient to provide positivecashflow, resulting in a near-term cash burn outlook for theCompany. As a result of the current series production level and thebroader market uncertainty, and in consideration of the fact that SEK3.0 million of the Company's current SEK 9.1 million liquidity iscomprised of a bank loan that is due for review in December 2009, theBoard of Directors has judged that it is in the best interest of theshareholders to proceed with a new rights issue at this time. Thenew rights issue, if approved by an Extraordinary General Meeting ofthe Shareholders on 20 August 2009, will ensure the long-termsecurity of the Company and enable the Company to take offensiveoperational actions as the market recovers. On this basis, the Boardof Directors has proposed a pre-emptive rights issue of shares andwarrants that will generate SEK 23.1 million, prior to transactioncosts.Market Penetration and CompetitionVirtually every company encounters competition, and SinterCast is noexception. However, based on SinterCast's pioneering and leadingrole in the development and application of CGI since the early1990's, SinterCast enjoys global brand recognition and respect as theCGI technology leader and is welcomed by the industry as a reliableand trustworthy partner in the industry. As the CGI market hasdeveloped, some foundry supply companies have proposed alternativeCGI technologies. To SinterCast's knowledge, these have includedHereaus-Electronite, OxyCast, OCC and NovaCast. It is also possiblethat some foundries may opt to produce CGI using in-house control anddiscipline, but this is generally judged to become less likely asproduct complexity and production volumes increase, and asspecification requirements become more rigidly enforced by theend-users. SinterCast judges that it's technology and engineeringknow-how provides the most reliable and cost-effective solution forthe production of high quality CGI. Based on its proven technology,production experience and engineering service, SinterCast willcontinue to support new CGI development activities to furtherincrease its share of the world CGI cylinder block and headproduction capacity. With respect to the development of alternativesautomotive technologies such as biofuels, hybrids and fuel cells,SinterCast does not expect these to have a significant effect on theCompany's competitive position for the foreseeable future.Accounting PrinciplesThe information provided on behalf of the Group in this interimreport has been prepared in accordance with Sweden's Annual AccountsAct and IAS 34 Interim Financial Reporting. As of 1 January 2009,several amendments to existing standards, new interpretations and onenew standard (IFRS 8) came into effect. In accordance with IAS 1,SinterCast has opted to present the Group's total earnings dividedinto two statements: a separate income statement and a statement ofcomprehensive income. Furthermore, the consolidated statement ofchanges in shareholders' equity only includes transactions with theGroup's owners. As of 1 April 2009, development costs that can bedirectly attributed to the design and testing of identifiable andunique new products controlled by the Group are recognised asintangible assets when the criteria of IAS38 are met. The reportingfor the Parent Company has been prepared in accordance with Sweden'sAnnual Accounts Act. The accounting policies that have been appliedfor the Group and for the Parent Company are in agreement with theaccounting policies used in the preparation of the Company's latestannual report.During the period, no material transactions have taken place betweenSinterCast and the Board or the Management.Events After the Balance Sheet DateThere have been no significant events since the balance sheet date of30 June 2009 that could materially change these financial statements,with the exception of the Board of Directors' proposal for a newrights issue and a new employee stock option programme, to be decidedupon at an Extraordinary General Meeting of the Shareholders on 20August 2009.Parent CompanySinterCast AB (publ) is the Parent Company of the SinterCast Group,with registered office located in Stockholm, Sweden. The ParentCompany has 10 (12) employees. The majority of the operations areconducted by the Parent Company, including responsibility for therepresentative office in China and sales representatives inAustralia, India, Japan and Korea. Operations in the UK and the USAare managed by the local companies. The information given for theGroup in this report corresponds in all material respects to theParent Company.PersonnelAs of 31 June 2009, the Group had 13 (16) employees, two (three) ofwhich were female. The core technical staff has the necessary skillsand resources to support ongoing customer activities and to supportthe current intensified market development. Further recruitment willbe phased with the development of field activities, particularly theneed to support new installations.Extraordinary General Meeting 2009An Extraordinary General Meeting of the Shareholders will be held at14:00 on Thursday 20 August 2009 at the premises of Remium AB,Kungsgatan 12-14, Stockholm, Sweden.InformationThe Interim Report July-September 2009 will be published on 4November 2009The Interim Report October-December and Full Year Results 2009 willbe published on 10 February 2010The Interim Report January-March 2010 will be published on 28 April2010The Interim Report April-June 2010 will be published on 25 August2010This report has been reviewed by the company's auditorsThe Board of Directors and the CEO certify that the half-yearlyfinancial report provides a true and fair overview of the operations,outlook, financial position and results of the Company and the Group,and describes the material risks and uncertainties that the Companyand the companies in the Group face.Stockholm, 19 August 2009Ulla-Britt Fräjdin-Hellqvist Aage Figenschou AndreaChairman of the Board Vice Chairman of the Fessler Board Member of the BoardRobert Dover Steve DawsonMember of the Board President & CEO Member of the BoardFor further information pleasecontact:Dr. Steve DawsonPresident & CEOSinterCast AB (publ)Tel: +46 8 660 7750Mobile: +44 771 002 6342e-mail: steve.dawson(at)sintercast.comWebsite: www.sintercast.comReview ReportWe have reviewed this report for the period 1 January 2009 to 30 June2009 for SinterCast AB. The board of directors and the CEO areresponsible for the preparation and presentation of this interimreport in accordance with IAS 34 and the Swedish Annual Accounts Act.Our responsibility is to express a conclusion on this interim reportbased on our review.We conducted our review in accordance with the Swedish Standard onReview Engagements SÿG 2410, Review of Interim Report Performed bythe Independent Auditor of the Entity. A review consists of makinginquiries, primarily of persons responsible for financial andaccounting matters, and applying analytical and other reviewprocedures. A review is substantially less in scope than an auditconducted in accordance with Standards on Auditing in Sweden, RS, andother generally accepted auditing standards in Sweden. The proceduresperformed in a review do not enable us to obtain assurance that wewould become aware of all significant matters that might beidentified in an audit. Accordingly, we do not express an auditopinion.Based on our review, nothing has come to our attention that causes usto believe that the interim report is not prepared, in all materialrespects, in accordance with IAS 34 and the Swedish Annual AccountsAct, regarding the Group, and with the Swedish Annual Accounts Act,regarding the Parent Company.Stockholm, 19 August 2009PricewaterhouseCoopersLiselott StenuddAuthorised Public AccountantAuditor in ChargeSinterCast is the world's leading supplier of process controltechnology for the reliable high volume production of CompactedGraphite Iron (CGI). With at least 75% higher tensile strength, 45%higher stiffness and approximately double the fatigue strength ofconventional grey cast iron and aluminium, CGI allows enginedesigners to improve performance, fuel economy and durability whilereducing engine weight, noise and emissions. SinterCast produces avariety of CGI components ranging from 2 kg to 17 tonnes, all usingthe same process control technology. The end-users of SinterCast-CGIcomponents include Aston Martin, Audi, Caterpillar, Chrysler, DAFTrucks, Ford, Ford-Otosan, General Electric Transportation Systems,General Motors, Hyundai, Navistar, Jaguar, Kia, Land Rover, MAN, MANB&W Diesel, Porsche, PSA Peugeot-Citroën, Renault, Rolls-Royce PowerEngineering, Toyota, Volkswagen, Volvo and Waukesha Engine. TheSinterCast share is quoted on the Small Cap segment of the NordicExchange, Stockholm (Stockholmsbörsen: SINT). ENDThe full report with tables can be downloaded from the followinglink:http://hugin.info/1205/R/1335692/317573.pdfThis announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.
Datum: 19.08.2009 - 09:13 Uhr
Sprache: Deutsch
News-ID 4856
Anzahl Zeichen: 0
contact information:
Town:
London
Kategorie:
Business News
Diese Pressemitteilung wurde bisher 341 mal aufgerufen.
Die Pressemitteilung mit dem Titel:
"SinterCast Results April-June 2009"
steht unter der journalistisch-redaktionellen Verantwortung von
SinterCast (Nachricht senden)
Beachten Sie bitte die weiteren Informationen zum Haftungsauschluß (gemäß TMG - TeleMedianGesetz) und dem Datenschutz (gemäß der DSGVO).
