Glaston Corporation STOCK EXCHANGE RELEASE 5 August 2021 12:45
EEST
Glaston’s Board of Directors has approved a revised strategy with key objectives
for 2021–2025. The key objectives are clearly improved organic growth and
profitability, based on Glaston’s own strategic initiatives and the expected
market growth.
Glaston’s addressable glass processing equipment market is expected to grow by
more than 5% annually, on average, during the strategy period, and Glaston’s
ambition is to clearly exceed this market growth. Strategic must-win development
initiatives securing net sales growth and improved profitability have been
identified in all Glaston’s business areas and the services business. These
initiatives are supported by Group-wide cornerstone initiatives that target
improved commercial and operational excellence.
Glaston’s core technologies and lifecycle solutions continue to be at the center
of its strategy and Glaston aims to take market share in all its business areas.
As the frontrunner in its industry, Glaston plans to increase its investments in
innovation and development. Glaston is also continuing its commitment to leading
the industry’s digital transformation. Profitability improvement is supported by
net sales growth, an optimal product offering, as well as productivity
improvements.
Along with its strategy, Glaston has set a new vision, which is to ‘lead the
global glass processing industry forward with innovative technologies and
lifecycle solutions’. The company’s purpose continues to be ‘build a better
tomorrow through safer, smarter and more energy-efficient glass solutions’.
“This strategy builds on our strengths, which are derived from the combination
of Bystronic glass and Glaston. We are focusing on fully utilizing the unique
opportunity to leverage our wide range of core glass processing technologies,
good customer relationships, experienced people with vast know-how, industry
-leading services and a large installed base. Strong global megatrends and
clearly growing markets, as well as our business area specific and company-wide
initiatives, are driving the growth and give us the confidence to set ambitious
financial targets”, says Anders Dahlblom, President and CEO of Glaston
Corporation.
“Glaston is aiming to take its sustainability ambition to the next level by
adding new non-financial targets. These highlight the sustainable nature of our
business and the strategic importance of our ESG commitment. I look forward to
embarking on this strategic journey together with a fully committed Glaston
team”, Dahlblom continues.
Financial targets
Glaston’s new financial targets for the strategy period 2021–2025 are:
- Annual average net sales growth (CAGR) clearly exceeding the
addressable equipment market growth of more than 5% [(1]
- Comparable operating margin (EBITA) of 10% at the end of the
strategy period [(2]
- Comparable return on capital employed (ROCE) of 16% at the end of
the strategy period [(3]
As glass processing technologies continue to be a fragmented industry, Glaston
is maintaining an interest in participating in industry consolidation.
SUSTAINABILITY AS A STRATEGIC FOCUS AREA
As the innovative frontrunner in its industry, Glaston’s ambition is to continue
being the leader in developing the industry towards a more sustainable future.
The majority of Glaston’s business is targeted at the architectural customer
segment in which the company’s products provide key technologies for improving
energy efficiency and the safety of buildings.
In its own operations, Glaston is committed to providing a safe and good
workplace for its employees, being a responsible partner to its customers,
utilizing resources efficiently, and reducing the environmental impact of its
production processes. Also, as the demand for more energy-efficient and
environmentally sustainable glass solutions is growing strongly, Glaston is
continuing to develop its product portfolio to meet this demand.
New non-financial targets:
Addressing the company’s focus on sustainability, in addition to its financial
targets, Glaston has set new non-financial strategic targets:
· Customer satisfaction score (Net Promoter Score, NPS) above 40
· Group-wide safety target measured as zero lost time accidents (LTA)
· Employee Engagement target above 75 (out of 100)
· Glaston’s CO[2] emissions (Scope 1 + 2)[(4] in relation to net sales down by
50% from the 2020 level. In 2020, greenhouse gas emissions were 2,777 tons of
CO[2] with net sales of EUR 170.1 million.
BUSINESS AREA FOCUS ON GROWTH
Glaston will capture growth through its core technologies and lifecycle
solutions from the following customer segments: architecture, automotive,
display and solar, as well as three regions: the Americas, APAC and EMEA. China
is a common focus area throughout Glaston, as it holds the single largest growth
potential for all customer segments and Glaston’s business areas.
The following strategic must-win initiatives have been identified:
· Insulating Glass will capitalize on its most advanced and automated
technology offering on the market by strengthening and broadening its presence
in all main customer segments and regions, particularly in North America and
APAC. The move towards carbon neutrality in Europe is already driving growth
strongly within the EMEA. The increased focus on reducing the energy consumption
of buildings is also expected to boost demand in other regions in the coming
years.
· Heat Treatment will continue its systematic development work for increasing
the level of automation towards a fully automated tempering line and modularity
of products, while broadening the offering. Emphasis is also being placed on
optimizing for cost efficiency and quality by, for example, further developing
installation processes for an excellent customer experience. Glaston also sees
attractive opportunities in solar panel glass processing technologies, in which
demand is being driven by the shift to renewable energy.
· Automotive & Display will focus on automotive and selected display
applications, as well as commercializing the most comprehensive product
portfolio in the industry. Glaston will also continue to develop automotive heat
treatment products to complement its market-leading pre-processing products for
an integrated offering.
· Services aims to grow in all business areas throughout its product
portfolio: spare parts, field services and upgrades, with increased focus on new
upgrade development, particularly in the Insulating Glass and Automotive &
Display businesses. Other focus areas include improved service accessibility,
fast and easy spare parts ordering, as well as further development of the
preventive maintenance and remote support concepts. Digitalization, access to
data and Artificial Intelligence (AI) capabilities will continue to be important
building blocks in creating new service models.
GLASTON CORNERSTONE INITIATIVES
Implementation of the business area-specific initiatives will be supported by
improvements in commercial and operational excellence through five Group-wide
cornerstone initiatives:
1. Innovate with customers to win focuses on strengthening Glaston’s technology
leadership (incl. digitalization) by seamless integration of customer
understanding, and joint and faster innovation and development work.
2. Lead digital transformation includes building the tools and infrastructure
across all Glaston operations to lead the industry’s digital transformation.
3. Empowering Glaston people to thrive is essential to building the desired
company culture. Leadership development and the leveraging of common leadership
principles will play a key role in implementing the strategy and embedding it
into everyday working life.
4. Elevate sustainability and continuous improvement will enable long-term
success by building a stronger culture of continuous improvement and
systematically progressing the sustainability agenda.
5. Master global sourcing and manufacturing will enable operational efficiency
and growth through more harmonized sourcing and manufacturing processes.
Glaston’s revised strategy is created in order to achieve clearly improved
organic growth and profitability. The roadmap for 2021–2025 builds on Glaston’s
business area specific strategic initiatives. The successful execution of the
strategy is supported by strong leadership and Group-wide cornerstone projects.
Glaston Corporation
Board of Directors
[1)] Glaston estimate, in euros. Glaston’s addressable equipment market is
expected to grow on average by more than 5% annually during 2021–2025. The
growth rate of the addressable equipment market is expected to exceed that of
the global flat glass market, which is expected to grow 3–4 % annually in
2021−2025, according to Grand View Research, 2021.
Glaston’s product portfolio is targeting those end-use areas of flat glass that
are growing faster than average (e.g. insulating glass). The addressable
equipment market also includes the customers’ replacement investments after the
operational life of machinery. During 2021−2025, replacement investments will be
further derived from productivity gains, especially through automation, as well
as technology and regulatory changes. Also, inflation explains part of the
difference between volume-based and euro-based market estimates.
[2)] Calculation of key ratio: Comparable EBITA: Operating result before
amortization, impairment of intangible assets and purchase price allocation +/-
items affecting comparability
[3)] Calculation of key ratio: Comparable return on capital employed, %
(Comparable ROCE): (Profit/loss before taxes + amortization of purchase price
allocations +/- items affecting comparability + financial expenses x 100)/Equity
+ interest-bearing liabilities, average as of 1 January and end of the reporting
period
[4)] Scope 1 emissions: direct greenhouse gas (GHG) emissions that occur from
sources that are controlled or owned by Glaston (e.g., emissions associated with
fuel oil, diesel and natural gas).
Scope 2 emissions: indirect GHG emissions associated with the purchase of
electricity, heat, and cooling.
For further information, please contact:
President & CEO Anders Dahlblom, tel. +358 10 500 500
Chief Financial Officer Päivi Lindqvist, tel. +358 10 500 500
Glaston Corporation
Pia Posio
Vice President, IR, Communications and Marketing
Tel. +358 10 500 5076
Glaston in brief
Glaston is the glass processing industry’s innovative technology leader
supplying equipment, services and solutions to the architectural, automotive,
solar and appliance industries. The company also supports the development of new
technologies integrating intelligence to glass.
Glaston is committed to providing its clients with both the best know-how and
the latest technologies in glass processing, with the purpose of building a
better tomorrow through safer, smarter, and more energy efficient glass
solutions. Glaston operates globally with manufacturing, services and sales
offices in 10 countries and its shares (GLA1V) are listed on NASDAQ Helsinki
Ltd.
Distribution: Nasdaq Helsinki Ltd, key media, www.glaston.net.