Translation: Original published in Finnish on 9/7/2026 at 7:53 am EEST.

Last week, we visited Exel's production facility in Kapfenberg, Austria. In addition to a tour of the factory, the visit included a review of the company's growth strategy and market outlook, in which, naturally, no significant changes had occurred compared to the Q2 earnings release. However, we believe the visit provided a good concrete understanding of the measures taken within the framework of the strategy.

Austria as a concrete example of increasing capacity utilization

The investment in the new production plant in Kapfenberg was decided in 2019, and it was commissioned in 2021. Therefore, the production plant is still modern. In addition, the factory plot's area would in principle allow for expansion investments in the future as well. We understand that production in Austria currently focuses heavily on the manufacturing of various glass fiber applications. We estimate that it serves several customer industries, with Buildings and Infrastructure and Transportation playing key roles. In addition, the plant manufactures various special profiles for industrial applications. At the business unit level, the factory serves Engineered Solutions customers, much like other Western factories.

Based on comments from the company's management and local plant management, the profiles transferred from the Belgian factory closed last year have been successfully ramped up after some initial challenges. However, the most significant change at the factory in recent years has been the transition to a 24/7 production model, which, according to comments, has significantly improved operational efficiency and profitability. This, combined with increased volumes (incl. applications transferred from Belgium) and a stronger focus on production, has led to an increase in capacity utilization rates in line with Exel's growth strategy. In our view, the plant management and staff also appeared to be satisfied with the impact of the strategic measures. At the same time, we estimate that operations can be further developed through continuous improvement and feedback received from various parts of the organization.

Other factories have also transitioned to a 24/7 model, market outlook is bright

Exel's management commented that the company's other factories have also transitioned to a 24/7 production model. That said, the management pointed out that this does not yet mean that all lines have transitioned to this, which we do not find surprising given the development phase of the strategy. However, our interpretation is that production across all factories has developed positively, but at present, most work remains at the US factory, which has caused headaches in the past. In addition, the focus naturally remains on ensuring the quality and delivery capability of the Indian plant as the volumes of commercial deliveries increase.

In turn, various market trends support, in the company's view, the longer-term growth prospects of composite materials and pultrusion manufacturers, particularly in the customer industries at the core of Exel's growth strategy. In our view, the Energy customer segment currently offers the most significant growth opportunities, supported by investments in wind power (for Exel: wind turbine blade reinforcements) and electrical grid infrastructure (Exel: composite conductor cores). However, we consider it crucial for Exel that the relative position of composites develops favorably compared to other materials, and that the relative positions of Exel and its customers develop favorably among manufacturers.

Overall, we were left with a positive impression from the visit, and we believe the company has progressed quite well in implementing its strategy according to the originally announced schedule. The company's Q2 result, our update on which can be read here, also provided indications of the effectiveness of the implemented measures.