Raute Corporation, a leader in veneer, plywood, and LVL production technologies, reported a substantial rebound in its financial performance for the year ended December 31, 2023. Raute's order intake for 2023 soared to Euro 315 million, more than doubling from the previous year's Euro 138 million. The order intake is composed of 65% (47%) from Europe, 15% (37%) from North America, 2% (8%) from Asia–Pacific and 19% (6%) from South America.
Net sales in 2023 totaled Euro 145.4 million (158.3), showing a decrease of 8.2% from the comparison period with a higher share of sales from Russia. The decline was also driven by the structure of the order book being more weighted towards mill-sized projects that have longer delivery times and slower revenue recognition. In addition, inefficiencies caused by the implementation of the new ERP system had a negative impact on net sales.
Sales increased by 37.7% in Analyzers, while decreased 14.5% in Wood Processing and 7.7% in Services. Net sales included Euro 13.4 (32.6) million from the remaining Russian order book.
Europe accounted for 40% (43) of net sales, North America for 30% (24), South America for 15% (6), Asia–Pacific for 6% (6) and Russia for 9% (21). Russia’s share of sales is based on the adjustments from renegotiations with customers and the limits set by the sanctions.
Mika Saariaho, the President and CEO, highlighted this achievement as a testament to Raute's leadership in providing comprehensive solutions in veneer, plywood, and LVL production technologies. The company secured four significant mill-sized orders and marked a milestone with the delivery of its inaugural line to the solid wood production segment. The financials reflect a positive trajectory with a comparable EBITDA of Euro 9.3 million, translating to a 6.4% margin, signaling a recovery from the lows of the previous year, largely attributed to a focused profitability improvement program.
The final quarter of 2023 was particularly noteworthy as Raute secured its largest-ever contract, valued at Euro 93 million, with Metsä Wood for a new LVL mill in Finland, contributing to a record Euro 118 million in order intake. This period also saw an uplift in the performance of the Analyzers and Services business units, driven by an uptick in sales, although the Wood Processing unit fell short of expectations due to increased costs from strategic growth and ESG initiatives.
Net sales in the fourth quarter stood at Euro 45.2 million, maintaining parity with the same period in the previous year, despite the phased exit from the Russian market and a shift towards projects with elongated delivery timelines. The company also reported sales growth in its Analyzers and Services divisions, attributed to its strategic focus and operational enhancements, including the successful deployment of a new ERP system at its main Nastola unit, poised to drive efficiency in the forthcoming years.
Despite the global market uncertainties affecting demand for single production lines and spare parts, Raute maintained a stable demand for its solutions, buoyed by the sustainable focus driving the engineered wood sector. The company concluded its profitability enhancement program, achieving the anticipated annual cost savings of Euro 4-5 million, and made a strategic exit from all remaining Russian projects and service operations.
Looking forward, Raute is set to continue its growth trajectory with a keen focus on its ESG agenda and expansion into new segments of engineered wood products. Organizational changes at the Executive Board level aim to strengthen the company's capacity to deliver on large projects and enhance its overall offerings. With a record-high order book as a foundation, Saariaho expressed optimism for the year ahead, confident in the company's strategic direction and the collective capabilities of the Raute team.
