Home / Knowledge / News / Textiles / Ahlstrom's operating environment reflects rapid downturn of global economy
Ahlstrom's operating environment reflects rapid downturn of global economy
05
Feb '09
Key highlights of year 2008:
• Full-year net sales grew by 2.4% to EUR 1,802.4 million (EUR 1,760.8 million). Fourth-quarter net sales amounted to EUR 419.0 million (EUR 462.5 million), decreasing by 9.4% due to a strong decline in the demand especially in December.
• Full-year operating profit decreased to EUR 14.6 million (EUR 25.8 million), and to EUR 35.7 million (EUR 67.8 million) excluding non-recurring items. Profitability was burdened by high raw material and energy prices throughout the year, ramp-up and integration costs as well as a downturn of the market in the final quarter.
• Net cash from operating activities developed favorably and increased by EUR 58.5 million to EUR 102.4 million as a result of improvement in working capital turnover.
• Further restructuring actions have been started to adjust operations to the weakening demand, including plans on capacity closures in Italy and a reduction of personnel worldwide. This incurred non-recurring items of EUR 21.7 million booked in the fourth quarter results.
• The Board of Directors proposes a dividend of EUR 0.45 (EUR 1.00) per share to be paid for the fiscal year 2008.

Outlook 2009:
• Based on the weak visibility, Ahlstrom changes its disclosure policy. An exact outlook on net sales and profitability is not given.
• In 2009, the operating environment is anticipated to remain very challenging, and the demand for Ahlstrom products will vary significantly by product line and depending on the general development of the customer industries.

Jan Lång, President & CEO, comments the year 2008:
In 2008, Ahlstrom finalized most of the growth investment program initiated after the IPO. Approximately EUR 500 million has been invested in growth initiatives in two years, and as a result of this, Ahlstrom's global reach is now stronger than ever before.

What I am not happy about is the weak financial performance in 2008, which was mainly driven by the low gross margin, weak demand in the fourth quarter as well as the higher than expected ramp-up and integration costs related to the growth investment program. On a positive note, we achieved growth in net sales that was in line with market growth, and cash flow improved significantly as a result of an improvement in working capital turnover.

Several measures were taken to improve profitability, and to adjust operations to the decline in demand. These included finalizing the work began at the end of 2007 to close down and restructure non-competitive operations in the USA and Europe. Towards the end of the year, production was cut down globally to adjust the operations to the changed market situation.

The operating environment is anticipated to remain very challenging throughout 2009. It is clear that in difficult times such as these, all means to maximize cash flow will be utilized, including a lower investment activity than in 2008. Ahlstrom has also announced further global restructurings for 2009 to respond to the decrease in demand. Despite the current challenges, I wish to stress that together with the strengthened Corporate Executive Team, we shall take an active approach in developing Ahlstrom over the longer term in addition to managing short-term matters.


Must ReadView All

Courtesy: Fashion Revolution/Fashion Transparency Index

Fashion | On 23rd Apr 2018

Top global fashion brands now more transparent

Fashion Revolution’s Fashion Transparency Index 2018 reveals Adidas...

Japan’s clothing imports up 4% in fiscal 2017

Apparel/Garments | On 23rd Apr 2018

Japan’s clothing imports up 4% in fiscal 2017

Japan’s imports of clothing and accessories increased by 4 per cent...

PVH, WWF tie up to protect water bodies in Ethiopia, India

Apparel/Garments | On 23rd Apr 2018

PVH, WWF tie up to protect water bodies in Ethiopia, India

PVH Corp , parent company of brands like Tommy Hilfiger, Calvin...

Interviews View All

Mandeep Nagi
Shades of India

Women value something that is unique and has a flavour of India

Amardeep Singh
Orient Craft

'In export markets, the trend in terms of embroidery, is towards matte...

Smarth Bansal
Colorjet India Limited

We would like to venture more companies into the Indian market

C Dhandayuthapani

MAG Solvics Private Limited was established in 1991 to design and develop...

Ravindra Jain, Ashish Baid

Oswal Prints Private Limited has been manufacturing and exporting ethnic...

Hardik Sanghvi

Idealin Fogging Systems has been engaged in designing and manufacturing...

Steve Cole
Xerium Technologies

Steve Cole of Xerium Technologies discusses the industry. Xerium is the...

Johan Berlin
InvestKonsult Sweden AB

Investkonsult Sweden AB has been buying and selling second-hand textile...

Silke Brand-Kirsch
Schlegel und Partner

Silke Brand-Kirsch, executive partner of Schlegel und Partner, a leading...

Amiben Shroff
Shrujan

From its modest beginning in the late 1960s, Shrujan has grown into a...

Vaanee Bhatia
Gritstones Clothing

<div>Delhi-based Gritstones Clothing offers quality and exemplary style...

Sidharth Sinha
Sidharth Sinha

<b>Sidharth Sinha</b> has contributed to the successful rebirth and...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

Leave your Comments


April 2018

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Planning to Take the Leap towards
Sustainability?

Do you see sustainability as a route to business growth?

Yes No

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes No

Active Poll

Do you see sustainability as a route to business growth?

Yes
69.9%
No
12.6%
Skip
17.5%

Total Votes: 103

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes No

Active Poll

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes
63.1%
No
29.1%
Skip
7.8%

Total Votes: 103

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes No

Active Poll

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes
87.4%
No
8.7%
Skip
3.9%

Total Votes: 103

Thanks for your valuable feedback. Claim your free latest sustainability e-book.

Active Poll

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes
82.5%
No
7.8%
Skip
9.7%

Total Votes: 103


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search