Componenta Corporation Stock Exchange Release on 14 March 2019 at 9.55
Componenta Främmestad AB, a Componenta Group company that provides machining and painting services in Sweden, is reducing its business operations and has initiated actions to reduce personnel. On 28 February 2019, a workforce reduction notice has been issued to the Swedish Employment Authority, regarding the reduction need of over one hundred persons. At this stage, accurate number of personnel concerned cannot be confirmed. Componenta Främmestad employs approximately 200 persons and approximately 35 leased persons.
The profitability of Componenta Främmestad AB's business has been chronically weak, and it has not improved substantially. The divestment of the Turkish foundry substantially weakened the strategic importance of the Swedish operations for Componenta Group.
Componenta Främmestad AB mainly distributes, machines and paints products of a former Turkish foundry company that was previously part of the Componenta Group, but which was divested in 2017. Part of the castings are delivered to Främmestad from Pori foundry, Finland. These deliveries represent approximately 40% of Pori unit's volumes. Therefore, downscaling activities are planned also in Pori foundry. Pori foundry employs 205 persons.
Componenta has made efforts to improve the profitability of the Swedish operations by renewing customer contracts. However, the negotiations have not led to desired result, and therefore Componenta had to terminate significant but unprofitable customer contracts of Componenta Främmestad AB.
Guidance for 2019
As previously announced, Componenta will publish its financial statement bulletin 2018 on 22 March 2019.
In order to illustrate its financial performance in 2019, Componenta exceptionally announces its guidance for 2019 already at this point.
Componenta expects continued operations to have net sales of EUR 70 - 90 million in 2019 and adjusted EBITDA excluding items affecting comparability is expected to remain positive.
COMPONENTA CORPORATION
Harri Suutari
President and CEO
For further information, please contact:
Harri Suutari
President and CEO
tel. +358 10 403 2200
Marko Karppinen
CFO
tel. +358 10 403 2101
Componenta is an international technology company. Componenta specializes in supplying cast and machined components to its global customers, who are manufacturers of vehicles, machines and equipment. The company's share is listed on Nasdaq Helsinki.