Incap Group Business Review for January-March 2018: Stable growth continues

Incap Corporation                                            
Interim report                       9 May 2018 at 8.30 a.m. (EEST)                                       

INCAP GROUP BUSINESS REVIEW FOR JANUARY-MARCH 2018: STABLE GROWTH CONTINUES

The information in this business review concerns the development of Incap Group in January-March 2018 and in the corresponding period of 2017, unless otherwise stated. The figures are unaudited.

Key figures in January-March 2018

• The Group's revenue amounted to EUR 12.5 million, up 13.7% on the corresponding period of previous year (Jan-Mar 2017: EUR 11.0 million).
• The Group's operating profit (EBIT) amounted to EUR 1.1 million, up 19.0% on the corresponding period (EUR 1.0 million).
• Net profit for the period amounted to EUR 0.7 million, up 5.5% on the corresponding period (EUR 0.66 million).
• The company repeats its previous outlook for full year 2018.

Key events of the period

Incap Group's business continued its strong growth meeting with the expectations in both factories in Estonia and in India. The revenue amounted to EUR 12.5 million, increasing by 13.7% on the comparison period in 2017.

The operating profit (EBIT) amounted to EUR 1.1 million, showing a growth of 19.0% on the comparison period. The increase in revenue and the successful management of cost levels resulted in favourable profitability.  The share of operating profit out of revenue remained at a good level and amounted to 9.2% (8.8%).

The company has after the end of the report period decided to invest in a new SMT line in the factory in India, and the negotiations on the supply of the line are ongoing.

The company's financing position continued to be good and the equity ratio on 31 March 2018 was 43.9% (36.6%).

Outlook for 2018

Incap's estimates for future business development are based both on its customers' forecasts and on the company's own assessments.

The company repeats its previous guidance and estimates that the Group's revenue and operating profit (EBIT) in 2018 are at the same level or somewhat higher than in 2017, assuming that there are no major changes in exchange rates. The company's revenue in 2017 amounted to EUR 48.5 million and the operating profit (EBIT) to EUR 4.5 million.

Incap will publish its half-year report for January-June 2018 in accordance with IAS 34 on Wednesday, 15 August 2018.  

Vesa Mäkelä, President and CEO of Incap Group:

"The revenue and profitability during the first quarter of 2018 met with our expectations. Part of the revenue growth came of advanced deliveries of a customer's orders and accordingly, the volume will most probably be missing from the revenue of the rest of the year. Our equity ratio improved further and the company's financial position still is very good.

The extension of our factory in India is in efficient use and we continue updating the machinery. Negotiations on a new SMT production line are ongoing and we expect that the new line can be inaugurated by autumn. Efforts for acquiring new customers to the Estonian factory have produced promising results.

In line with the growth of the company we are putting more efforts on the sales and marketing, and for this we have introduced a CRM system to enhance especially the new customer acquisition. We have increased the coordination in our central functions like finance, sales, IT and communications in order to utilize the synergies of global operations and to free the resources in factories for the development of service offering and the maintenance of high quality. The company website has been updated in line with the Group communications strategy.

Prospects for contract manufacturing services are bright. We continue focusing on the maintenance of good profitability levels, and we have succeeded in compensating the slight increase in material prices through the increase in efficiency. Our target is to continue with organic growth while at the same scanning the possibilities to increase our business also by M&A."

INCAP CORPORATION
Board of Directors

For additional information, please contact:
Vesa Mäkelä, President and CEO, tel. +358 40 835 4495

Distribution:
Nasdaq Helsinki Ltd.
Principal media
The company's home page www.incapcorp.com

INCAP IN BRIEF
Incap Corporation is an international contract manufacturer. Incap's customers are leading suppliers of high-technology equipment in their own business segments, and Incap increases their competitiveness as a strategic partner. Incap has operations in Finland, Estonia, India and China, and the company currently employs approximately 570 people. Incap's share is listed on the Nasdaq Helsinki Ltd. as from 1997. Additional information: www.incapcorp.com.