OPCON: Press Release
STOCKHOLM, Sweden--Feb. 27, 2001--The Group's performance in the fourth quarter of 2000 was positive in terms of sales turnover, profits and cash flow.| -- | Sales turnover in 2000 amounted to SEK 256.3 million (238.8 m). |
| -- | The profit after financial items was SEK 6.0 million (-8.0 m), |
-- The order book was 15% higher than last year and ended the year at SEK 141 million (122 m).
-- Fast growth within the market for air supply systems for combustion and fuel cell engines is spurring growth in sales and profits.
-- Positive development for the Group's sales turnover, profits and cash flow is expected in 2001.
THE GROUP
Summary
Sales turnover in 2000 amounted to SEK 256.3 million, compared with SEK 238.8 million in 1999. Profit after financial items was SEK 6.0 million (- 8.0 m).
The reported profit for the year includes funds returned from SPP amounting to SEK 5.7 million.
The fourth quarter showed continued improvement by the Group and the profit for the period was SEK 3.6 million. The financial position was also strengthened. Cash flow for the fourth quarter was SEK 4.5 million. At the end of the year, liquid funds amounted to SEK 25.8 million (14.3 m).
The Group's improvement in profits is primarily due to the performance of Opcon Autorotor AB, which turned a loss of SEK 10.8 million into a profit of SEK 0.5 million. This improvement came from an increase in development assignments and in deliveries of air systems for fuel cell engines.
In the fuel cell sector an agreement has been signed between Opcon Autorotor AB and Xcellsis, a company jointly owned by DaimlerChrysler, Ballard and Ford that develops fuel cell engines. The agreement states that Opcon Autorotor AB will develop air supply systems for the new engines. In addition, Opcon Autorotor AB has a production agreement in the form of an option with Xcellsis. Opcon Autorotor AB has also signed another agreement with an international engine manufacturer, which represents a breakthrough in the use of compressors for combustion engines that have significantly lower emissions.
During the year SEM AB signed long-term agreements with Husqvarna and Stihl regarding increased deliveries of ignition systems for chainsaws. The two agreements are worth around SEK 140 million jointly. They are important strategically because they mean the Group's goals for growth will be achieved.
Financial position
The Group's liquid funds amounted to SEK 25.8 million (14.3 m) and interest-bearing debt amounted to SEK 59.0 million (59.0 m). Ongoing operations during the year contributed a cash flow of SEK 29.2 million (0.2 m). Total cash flow, after the effects of investment and financing, amounted to SEK 11.5 million, compared with SEK -19.0 million in 1999. The Group's equity/assets ratio was 43.4%.
Investments
Investment in machinery, stock and tools during the year totalled SEK 12.9 million (24.1 m), of which SEK 1.0 million (3.9 m) was for product development. Costs for research and development during the year reached SEK 15.5 million (12.2 m), of which SEK 4.9 million (1.6 m) has been carried forward. Two assignments - the Elevate project, a development project partly financed by the EU that aims to develop a clean two-stroke engine, and a project aimed at the development of a module-based motorbike ignition system - represent most of the amount carried forward. The year's depreciation of costs carried forward for research and development amounted to SEK 2.9 million.
Employees
The total number of employees at the end of the year was 335 (348). The average number of employees, measured as full-time staff, was 316 (313).
SEM AB
Sales turnover in 2000 reached SEK 148.6 million (151.4 m). The operating profit for the year was SEK 3.7 million (10.0 m), excluding SEK 4.2 million in funds returned from SPP. The fall in sales turnover and profit was due to, among other factors, reduced deliveries of ignition cassettes for the Saab V6 engine. The reduction was forecast at the start of the year but remained for a longer period than expected. Deliveries to the Saab after-sales market were also down on the previous year. Increased investment in development also affected the operating profit. During the year agreements were signed with Husqvarna and Stihl which mean considerably increased volumes of ignition systems for chainsaws. The agreements run for several years and are jointly worth around SEK 140 million. They strengthen the company's position as one of the world's leading manufacturers of ignition systems for small motors used in products such as chainsaws and hand-held equipment.
SEM Drive AB
Sales turnover in 2000 totalled SEK 59.4 million (50.8 m), a climb of 17%. The operating profit was SEK 2.1 million (-1.5 m), excluding SPP funds (0). The company performed positively during the year in terms of orders, sales and profits.
Transformator-Teknik AB
Sales turnover totalled SEK 30.0 million (30.4 m) in 2000. The operating profit of SEK 1.4 million (2.3 m), excluding SEK 1.5 million in funds returned from SPP, was negatively affected by one-off costs and increased price pressure for key products.
Opcon Autorotor AB
Sales turnover in 2000 reached SEK 18.9 million (8.2 m). The operating profit was SEK 1.1 million (-10.0 million), excluding funds returned from SPP (0.1 million). The major improvement in profits was due to an increase in development assignments and in orders for air systems for fuel cell engines, plus a recovery in deliveries to the after-sales market for compressors in the US. Furthermore, profits were boosted by a one-off item worth SEK 1.5 million received for signing a development agreement. During the year Opcon Autorotor AB has strengthened its position by signing several delivery and development agreements. The company has joined a development project together with world leading companies that will develop a new engine concept for combustion and fuel cell engines. Development of fuel cells and new combustion concepts for powering vehicles is on the increase worldwide.
Parent company
The parent company made a loss after financial items of SEK 3.9 million (- 4.7 m) in 2000. The parent company did not receive returned SPP funds.
Outlook for 2001
The increase in sales and profits recorded in 2000 is expected to continue into 2001. Growth is the result of the Group's technology and the delivery agreements that have been signed. This unique technology helps to reduce emissions from various types of vehicles and small engines. The focus on development in all of Opcon's business areas will continue. Growth will also be achieved via acquisitions.
The importance of the US market, especially for SEM AB and Opcon Autorotor AB, make it necessary to establish a manufacturing and sales organisation in the US. Negotiations to this end are under way. SEM AB's four-year agreement with Husqvarna will add significantly to volumes from 2001 onward. SEM AB's volumes in the first quarter of 2001 already show a major increase compared with e same period in 2000. Production of the Stihl order is planned to start during the first half of the year. SEM AB has introduced a new digital ignition system that has attracted great interest among European motorbike manufacturers. SEM AB is also continuing development of its ion sense technology by integrating it into the development of new engine management systems for the more environment- friendly combustion engines of the future. The business area is therefore well equipped to meet the requirements set by new environmental legislation.
In the first quarter of 2001 SEM Drive AB signed a new three-year agreement with Kongsberg Automotive. The agreement strengthens the positive development of the company.
Opcon Autorotor AB has a unique position in the new growth markets for fuel cells and super-charged combustion engines for mobile applications. More and more customers are turning to Opcon Autorotor AB and the increase in orders will lead to increased deliveries in 2001.
This growth means that Opcon Autorotor AB will quickly see a return on investment and that this return will be high in the long term. Within the transformer sector, price pressure remains tough. Continued production in Estonia boosts Transformator-Teknik AB's competitive strength and enables it to win market share while retaining its customers at existing profit margins.
Future information
-- Q1 report: 26 April 2001. -- Annual Report, 2000: April 2001. -- AGM: 26 April 2001, Stockholm. -- Q2 report: 23 August 2001. -- Q3 report: 25 October 2001.
The Group
Income statement (SEK 000) Oct- Oct- Full Full
Dec Dec year year
2000 1999 2000 1999
Net sales 73 515 65 116 256 289 238 751
Operating profit before depreciation 9 516 4 919 30 836 17 465
Depreciation of tangible fixed 3 539 5 281 18 224 19 194
assets
Depreciation of intangible fixed 1 898 1 351 4 471 4 247
assets
Operating profit 4 079 -1 713 8 141 -5 976
Financial items -518 -465 -2 105 -2 009
Profit/loss after financial items 3 561 - 2 6 036 -7 985
178
Tax - - - -
Minority shares 76 265 -25 2
Profit/loss for the period 3 637 -1 913 6 011 -7 983
Balance sheet (SEK 000) 31-12-00 31-12-99
Tangible fixed assets 69 421 76 212
Intangible fixed assets 7 896 6 090
Financial fixed assets 46 46
Fixed assets 97 402 89 937
Liquid funds 25 766 14 274
Total assets 200 531 186 559
Shareholders' equity 86 452 80 441
Minority shareholdings 632 607
Interest bearing provisions and 59 047 59 027
liabilities
Long-term non interest bearing 656 655
liabilities
Current non interest bearing 53 744 45 829
liabilities
Total shareholders' equity and 200 531 186 559
liabilities
Key figures Oct- Oct- Full Full
Dec Dec year year
2000 1999 2000 1999
Operating margin, % 5.6 -2.6 3.2 -2.5
Return on operating capital, % - - 6.6 -5.1
Return on equity, % - - 7.2 -9.5
Profit/loss per share, SEK 0.58 -0.31 0.97 -1.28
Equity per share, SEK 13.85 12.89 13.85 12.89
Equity/assets ratio, % 43.4 43.4 43.4 43.4
No. of shares, thousands 6 242 6 242 6 242 6 242
Cash flow statement (SEK 000) Oct- Oct- Full Full
Dec Dec year year
2000 1999 2000 1999
Cash flow from
current activities 12 808 6 371 29 181 245
Cash flow from
investment activities -8 230 -9 269 -17 710 -25 582
Cash flow from
financing activities -59 -358 21 6 300
Total cash flow 4 519 -3 11 492 -19 037
256
Income statement (SEK Jan- Apr- Jul- Oct- Jan- Apr- Jul- Oct-
000) March June Sept Dec March June Sept Dec
(Per quarter) 2000 2000 2000 2000 1999 1999 1999 1999
Net sales 59 64 58 73 57 67 48 65
574 785 415 515 440 946 249 116
Operating profit/loss -2 4 624 1 841 4 079 -2 -1 228 -1
403 748 743 713
Financial items -540 -585 -462 -518 -805 -574 -165 -465
Profit/loss after -2 4 039 1 379 3 561 -3 -2 63 -2
financial items 943 553 317 178
Tax 0 0 0 0 0 0 0 0
Minority shares 88 -118 -71 76 -94 -95 -74 265
Profit/loss per
quarter -2 3 921 1 308 3 637 -3 -2 -11 -1
855 647 412 913
Balance sheet
(SEK 000) 31-03- 30-06- 30-09- 31-12- 31-03- 30-06- 30-09- 31-12-
00 00 00 00 99 99 99 99
Fixed assets 79 76 74 77 80 80 79 82
606 489 570 363 593 437 711 348
Current assets 93 96 93 97 93 95 90 89
923 000 150 402 660 727 268 937
Liquid funds 10 13 21 25 22 19 17 14
384 677 247 766 894 973 530 274
Total assets 183 186 188 200 197 196 187 186
913 166 967 531 147 137 509 559
Shareholders'
equity 77 81 82 86 84 82 82 80
586 507 815 452 777 365 354 441
Minority
shareholdings 520 638 709 632 703 799 873 607
Interest bearing 57 56 59 59 54 59 60 59
provisions and 885 576 005 047 410 942 325 027
liabilities
Long-term non
interest 655 655 655 656 656 656 656 655
bearing liabilities
Current non interest 47 46 45 53 56 52 43 45
bearing liabilities 267 790 783 744 601 375 301 829
Total shareholders' 183 186 188 200 197 196 187 186
equity and
liabilities 913 166 967 531 147 137 509 559
Key figures
Operating margin, % -4.0 7.1 3.2 5.6 -4.8 -2.6 0.5 -2.6
Equity/assets
ratio, % 42.5 44.1 44.2 43.4 43.4 42.4 44.4 43.4
No. of shares,
thousands 6 242 6 242 6 242 6 242 6 242 6 242 6 242 6 242
Amal, Sweden 22 February 2001
Opcon AB (publ) 556274-8623 The Board of Directors
Opcon's business concept is to develop, manufacture and market systems and products that help to generate clean and environment-friendly power. The Group comprises SEM AB, SEM Drive AB and Transformator-Teknik AB, which have manufacturing in Amal, Sweden, and Opcon Autorotor AB, based in Nacka, near Stockholm. The Group's products include ignition systems and engine management systems, electro-mechanical devices, compressors and transformers. The Group's customers are mainly in the auto, small engine and engineering industries.
The Opcon Group has around 335 employees and has its head office in Amal, Sweden. Opcon AB is listed on the O list of the OM Stockholm Stock Exchange.
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