From the CEO

February 15, 2017

 



We broke last year's order intake record!
 
Following the record-breaking year 2015, some expected that 2016 would mark a lull for Raute. To the contrary. During the past year, we achieved a new order intake record. 
 
Due to the relatively low order intake beginning in summer 2015 and lasting approximately one year our order book fell, momentarily, in summer 2016 to a fairly low level. The situation changed entirely in the summer, however, when three major orders proceeded to the order phase and raised our order book to record levels. Despite this, we were not quite able to reach our targets in terms of net sales. We are, nevertheless, happy with 2016 as a whole and were able to start with a record-high order book for a second year running. 
 
Economic development in our main market areas was still not favorable. The worst of the crisis has passed in Europe but uncertainty, in particular in Europe's banking sector, continues, impacting other areas as well. In North America, construction has begun to recover but still at a slower rate than expected. In South America, our key customers' previous investments have now found their place on the markets and, although the focus is on the future, the weak demand in the domestic markets is slowing new investment plans. The uncertainty around the path taken by China's economy and political tensions are resulting in concern in many market areas. 
 
In 2016, a few large, capacity-generating mill-scale projects took off in the plywood and LVL industry. We succeeded in winning the tenders in all of these. Each of the projects is being implemented by a familiar, long-term customer. We have our long-running co-operation with our customers, their success in business and confidence in the future to thank for these victories.
 
Over the past year, we made significant investments in new development projects. In terms of product development, the most vital role was held by digital services, which help boost our customers' operations and deepen our cooperation further. We also invested in improving our operations in production, information systems and office work. 
 
We improved the capacity and service ability of our technology services by, for example, starting up two new service centers in connection with our customer mills. Our key personnel and competence development projects were the improvement of occupational safety, the setting in motion of a systematic mentoring program and business sustainability work.
 
The advancement of the previous year's major mill projects and being awarded more of these types of orders were our most important achievements in 2016. The positive development of our North American business and success of our machine vision technology with its new product launches were also particular causes for celebration. We succeeded in expanding our overall service concept by integrating services into our investment commodity deliveries. The above-mentioned examples are an indication that we have made advances in achieving many of our strategic targets. In order to meet the needs of the emerging markets, we have developed new methods in order to achieve our strategic targets. 
 
It is already clear that our business will take a positive trend in 2017 and we will achieve increased net sales and improve our operating profit. Our development projects to implement our strategy are moving forward and improving our operations even further. Demand is at a normal level, which is a good basis for growth in the current year. Our all-time highest order book provides us with the boost needed for a spectacular take-off. We have knowingly planned our work to ensure that we can provide our customers competitive delivery times also in 2017, both in terms of investments of various sizes and services. Our efforts are focused on strengthening our position particularly in projects involving individual production lines and machines and modernizations. 
 
I would like to send out a heartfelt thank you for the past year: to Raute's customers for their invaluable cooperation and trust, to our personnel for their outstanding work and flexibility under the strongly fluctuating workload, to our shareholders for their continued confidence in us, and to all our other partners for their participation in furthering Raute's development and success. 
 
 

Tapani Kiiski
President and CEO