Vacon Plc Financial Statement Bulletin 1 January - 31 December 2012

Vacon Plc, Stock Exchange Release, 5 February 2013 at 9.30 pm (EET)

In this stock exchange release Vacon is publishing information that has a significant impact on securities included in the financial statements. The full financial statements are in the appendix to this release and can be downloaded from the company`s website in English at and in Finnish at


October-December summary:

  • Order intake totalled MEUR 94.4 (MEUR 76.9), an increase of 22.8 % from the corresponding period in the previous year.
  • Revenues totalled MEUR 103.2 (MEUR 87.6), growth of 17.8 %.
  • Operating profit was MEUR 10.9, or 10.6 % of revenues, (MEUR -3.9 and -4.4 %).
  • Operating profit excluding one-time items was MEUR 12.1, or 11.7 % of revenues (MEUR 5.7 and 6.5 %).
  • Net cash flow from operating activities was MEUR 15.1 (MEUR 6.2).
  • Earnings per share were EUR 0.50 (EUR -0.18).


January-December summary:

  • Order intake totalled MEUR 401.9 (MEUR 365.3), an increase of 10.0 % from the corresponding period in the previous year.
  • Revenues totalled MEUR 388.4 (MEUR 380.9), growth of 2.0 %.
  • Operating profit was MEUR 37.7, or 9.7 % of revenues (EUR 24.7 and 6.5 %), an increase of 52.3 %.
  • Operating profit excluding one-time items was MEUR 36.2, or 9.3 % of revenues (MEUR 34.8 and 9.1 %).
  • Net cash flow from operating activities was MEUR 52.3 (MEUR 26.8).
  • Earnings per share were EUR 1.70 (EUR 1.10), growth of 54.0 %.
  • The Board of Directors proposes to the Annual General Meeting of Shareholders that a dividend of EUR 1.10 per share be paid from the profit for 2012.



Key indicators

October-December key indicators:

MEUR 10-12/2012 10-12/2011 Change, %
Order intake 94.4 76.9 22.8%
Revenues 103.2 87.6 17.8%
Operating profit 10.9 -3.9
% of revenues 10.6% -4.4%
Operating profit excluding one-time items 12.1 5.7 112.8%
% of revenues 11.7% 6.5%
Profit before taxes 10.6 -1.4


January-December key indicators:

MEUR 1-12/2012 1-12/2011 Change, %
Order intake 401.9 365.3 10.0%
Order book 50.0 36.6 36.9%
Revenues 388.4 380.9 2.0%
Operating profit 37.7 24.7 52.3%
% of revenues 9.7% 6.5%
Operating profit excluding one-time items 36.2 34.8 4.0%
% of revenues 9.3% 9.1%
Profit before taxes 36.8 27.0 36.5%
Net cash flow from operating activities 52.3 26.8 95.0%
Earnings per share, EUR 1.70 1.10 54.0%
Return on equity, % 25.8% 18.7%
Interest-bearing net liabilities -10.3 12.4
Gearing, % -9.5% 12.7%
Gross capital expenditure 14.0 18,7 -25.3%


Business environment and business development

According to initial market surveys and in Vacon`s assessment, the AC drive market did not grow significantly during 2012. The situation was most difficult in Europe, where the market even declined from the previous year. The markets in Asia and North America grew slightly from the previous year.

Vacon`s revenues and orders increased in both the October-December quarter and the January-December 2012 full year compared to the periods for comparison in the previous year. The company`s sales increased in 2012 especially in building automation and the marine industry. In contrast sales for the generation of solar energy and wind power fell sharply, accounting for only 3 % of the company`s revenues in 2012, compared to 13 % in 2011. During 2012 Vacon succeeded in compensating for the fall in the sales of products for renewable energy generation by increasing its sales to other industrial sectors, at the same time raising its market share.

Vacon`s revenues increased sharply in October-December and January-December 2012 in the Asia Pacific region (APAC). Sales in North and South America also developed positively both in the October-December period and for the whole of 2012. Sales in the Europe, Middle East and Africa (EMEA) region rose in October-December, but declined slightly for the whole of 2012 as the result of weak demand for products for renewable energy generation and the general state of the economy in the region. Full year revenues in the EMEA region grew slightly from the previous year, if renewable energy is not included.

The company`s profitability measured in terms of the operating profit percentage improved both in October-December and in January-December 2012. Profitability improved particularly in the second half of 2012. Vacon carried out several measures in 2012 to improve profitability. The most important of these was the transfer of material sourcing to low-cost countries. Last year 50 % of material sourcing came from low-cost countries (40 % in 2011).

During the final quarter of the year Vacon continued its release of new products with the launch of the VACON® 100 Flow product, which is the latest AC drive in the VACON® 100 product range. It offers a wide range of flow control functions for water and waste water treatment and for building automation applications.

Vacon continued to strengthen its global standing in the fourth quarter of 2012 by establishing a regional centre in Singapore and a representative office in Kazakstan.

Dividend proposal

At the end of the financial year the distributable equity of the parent company stands at EUR 69.7 million. The Board of Directors proposes to the Annual General Meeting of Shareholders to be held on 26 March 2013 that a dividend of EUR 1.10 per share be paid from the parent company`s profit for the 2012 financial year of EUR 20.5 million and the remainder of the profit for the year be transferred to retained earnings. According to this proposal, a total of EUR 16.7 million would be paid in dividend.

Prospects for 2013

Vacon estimates that the global AC drive market will grow considerably faster than average growth in industrial production, by an estimated 5-10 % in 2013. Investments to improve energy efficiency and economic growth in developing countries will support growth in demand for AC drives.

Vacon is well placed to improve its profitability in 2013. Key factors in improving profitability are the cost benefit from transferring material sourcing to low-cost countries and the development of overall efficiency in operations. 

Market guidelines 2013

Vacon will continue the practice of announcing its market guidelines for the whole year in its financial statement bulletin and repeating them in its interim reports. The guidelines will be updated if the need arises.

Vacon estimates that its revenues will increase 5 - 15 % and that its operating profit percentage excluding one-time items will be 10 - 12 % in 2013.

Revenues in 2012 totalled EUR 388.4 million and the operating profit percentage excluding one-time items was 9.3 %.

Vacon`s goal is to achieve revenues of EUR 500 million in 2014. Its profitability target for 2014 is an operating profit of 14 %, and for return on equity the target is more than 30 %.

Financial reports in 2013

Vacon is publishing three interim reports in 2013 as follows:

  • January-March:  23 April 2013
  •  January-June: 1 August 2013
  • January-September:  22 October 2013

Formal statement

This release contains certain forward-looking statements that reflect the current views of the company`s management. Due to the nature of these statements, they contain risks and uncertainties and are subject to changes in the general economic situation and in the company`s business sector.

Vacon in brief

Vacon is driven by a passion to develop, manufacture and sell the best AC drives and inverters in the world - and provide customers with efficient product lifecycle services. Our AC drives offer optimum process control and energy efficiency for electric motors. Vacon inverters play a key role when energy is produced from renewable sources. Vacon has production and R&D facilities in Europe, Asia and North America, and sales offices in 29 countries. Further, Vacon has sales representatives and service partners in nearly 90 countries. In 2012, Vacon`s revenues amounted to EUR 388.4 million, and the company employed globally approximately 1,500 people. The shares of Vacon Plc (VAC1V) are quoted on the main list of the Helsinki stock exchange (NASDAQ OMX Helsinki).

Driven by Drives,

Vaasa, 5 February 2013


Board of Directors

For more information please contact:

  • Mr Vesa Laisi, President and CEO, phone: +358 (0)40 8371 510
  • Ms Eriikka Söderström, CFO and Vice President, Finance & Control, phone: +358 (0)40 8371 445

Conference for media and analysts

A briefing for the financial analysts and media will be held on 5 February 2013 at Pörssitalo, Fabianinkatu 14 A, 2nd floor, Helsinki (entrance via NASDAQ OMX Helsinki`s reception) at 11:30 am Finnish time (EET).

Dial-in conference for investors and investment analysts

A dial-in conference in for investors and investment analysts will be held at 3.00 pm (EET) on 5 February 2013. President and CEO Vesa Laisi and Eriikka Söderström, CFO will participate in the conference. Please call +358(0)9 2310 1620 (Finland Toll) or +44(0)20 3364 5381 (UK Toll) and request to be connected to the Vacon call (Confirmation code 7253849). A recording of the conference will be available for seven days at (0)9 2310 1650 (Finland Toll) or (0)20 3427 0598 (UK Toll) or 347 366 9565 (US Toll) and access code 7253849.

The presentation material will be available before the media briefing on Vacon`s website at: > Investors > Publications and releases.


Financial Supervisory Authority
Main Media

This announcement is distributed by Thomson Reuters on behalf of Thomson Reuters clients.

The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and other applicable laws; and
(ii) they are solely responsible for the content, accuracy and originality of the
information contained therein.

Source: Vacon Oyj via Thomson Reuters ONE

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