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2016-02-17

SinterCast: Record production, revenue and operating result

Fourth Quarter 2015
* Revenue for Period: SEK 17.2 million (SEK 15.6 million)
* Operating Result: SEK 4.4 million (SEK 3.5 million)
* Earnings per Share from Operations: SEK 0.6 per share (SEK 0.5 per share)
* Earnings per Share: SEK 1.3 per share (SEK 0.5 per share)
* Cashflow from Operations: SEK 4.6 million (SEK 3.2 million)
* Ram EcoDiesel captures third consecutiveWards 10 Best Engine award
* First CGI aviation engine begins FAA approval process in United States

Full Year 2015
* Revenue for Period: SEK 72.4 million (SEK 54.5 million)
* Operating Result: SEK 20.3 million (SEK 10.2 million)
* Earnings per Share from Operations: SEK 2.9 per share (SEK 1.4 per share)
* Earnings per Share: SEK 3.6 per share (SEK 1.7 per share)
* Cashflow from Operations: SEK 20.4 million (SEK 6.7 million)
* Dividend: Proposed ordinary dividend of SEK 2.0 per share (SEK 1.5 per
share) plus an extraordinary dividend of SEK 1.5 per share (SEK 0.7 per
share)
* Six installation commitments equals record for new installations
* Installed Base: 24 fully automated systems and 20 mini-systems in Europe,
Asia and the Americas
Series Production*
For graph, please see Press Release PDF

Annualised series production increased to 2.1 million Engine Equivalents in
the fourth quarter, despite lower shipments in December due to year-end
shutdowns.

* Annualised average production of Engine Equivalents during the quarter (1
Engine Equivalent = 50 kg)

CEO Comments
Record results in all operational areas
The progress of 2015 provided record results in all of SinterCast's key
metrics. Full year series production finished at the record level 2.1
million Engine Equivalents, providing 18% growth compared to 2014. The
increased series production also led toward record Sampling Cup shipments of
152,700, representing an increase of 15% above the previous record
established in 2014. Beyond series production, the growing awareness and
demand for CGI resulted in new installation commitments in Europe, Asia and
the Americas. Six new installation commitments were secured, equalling the
previous one-year high. Combined with favourable exchange rates, the
improvements in production, Sampling Cups and installations resulted in
record revenue of SEK 72.4 million and almost 100% increase in the full year
operating result.

Series production was primarily buoyed by strong growth in passenger vehicle
applications, benefitting from the ramp up of the Ford petrol engine and from
continued strong sales of the 3.0 litre V6 diesel engines for Audi, FCA and
Ford. The outlook for passenger vehicles remains positive with new vehicle
applications being announced for the Ford petrol engine and with the start of
sales of the 5.0 litre V8 diesel in the all-new Nissan Titan pick up in the
US. The Nissan Titan is exclusively available with the SinterCast-CGI diesel
engine, so all sales provide incremental growth. The Ram 1500 continues to
be the flagship for SinterCast's promotion of diesel engines in the important
US pick up market. With the best fuel economy rating in the full size light
duty pick-up sector, the 3.0 litre V6 diesel engine won a third
consecutiveWards
10 Best Engines award. The CGI diesel was the only winner to receive a third
consecutive award; one of only two repeat winners; and, was the only diesel
among the ten winning engines. The success of the Ram diesel has validated
SinterCast's longstanding belief in diesel engines in pick up applications
and has established a competitive benchmark in the segment.

Beyond passenger vehicles, the production of cylinder blocks and heads for
commercial vehicle applications and of components for industrial power
applications also increased during 2015. While the industrial power sector
is primarily regarded as large off-road components for agricultural,
construction, marine, locomotive and stationary power applications, a new
application was announced during the fourth quarter. Engineered Propulsion
Systems (EPS) announced that it has specified Compacted Graphite Iron (CGI)
for the cylinder block of its new aviation diesel engine. Currently
undergoing Federal Aviation Authority (FAA) approvals in the United States,
the use of CGI enabled EPS to engineer a clean sheet Aviation Diesel engine
that is setting new standards in weight, size, reliability, and most
importantly, fuel consumption. Initial testing of the pre-production engine
has demonstrated specific power of 105 horsepower per litre (77 kw/l),
resulting in an output of 450 horsepower (332 kW). The installed wet weight
of the 450 horsepower diesel engine package is within 45 pounds (20 kg) of
alternative 350 horsepower (257 kW) air-cooled turbocharged engines currently
used in aero applications.

Installation Commitments in Europe, Asia and the Americas
Building on the increased awareness and demand for CGI, 2015 was a strong year
for new installation commitments, with two installations commissioned in
China, one in Japan, one in Korea, one in Portugal and a year-end order for a
System 3000Plus
installation at the Teksid foundry in Brazil. The Teksid do Brasil
installation is planned to be commissioned during the second quarter of 2016.
All of the other 2015 installations have been successfully commissioned and
product development is proceeding according to schedule.

New product development
SinterCast is continuously investigating new concepts and developing new
technologies. At present, SinterCast is developing the application of its
thermal analysis know-how to the control of ductile iron production,
including the development of a bespoke ductile iron thermal analysis sampling
device and the optimisation of metallurgical correlations. SinterCast is
also developing other technologies - within and beyond the scope of thermal
analysis - to improve quality and production efficiency in the cast iron
foundry industry.

Financial Summary
Revenue
The revenue for the SinterCast Group relates primarily to income from
equipment, series production and engineering service.

---------------------------------------------------------------------------------------------
| Revenue Breakdown October-December January-December |
| (Amounts in SEK million if not otherwise stated) 2015 2014 2015 2014 |
| Number of Sampling Cups shipped 40,700 38,200 152,700 133,000 |
| Equipment 0.4 1.1 7.7 4.9 |
|1 |
| Series Production 16.6 13.9 63.6 47.8 |
|2 |
| Engineering Service 0.2 0.3 1.0 1.4 |
|3 |
| Other 0.0 0.3 0.1 0.4 |
| Total 17.2 15.6 72.4 54.5 |
| |
| Notes 1. Includes revenue from system sales and leases and sales of spare parts |
|: |
| 2. Includes revenue from production fees, consumables and software licence fees |
| 3. Includes revenue from technical support, on-site trials and sales of test |
| pieces |
---------------------------------------------------------------------------------------------

TheOctober-December 2015
revenue amounted to SEK 17.2 million (SEK 15.6 million). Revenue from series
production increased by 19% to SEK 16.6 million (SEK 13.9 million), due to
increased annualised production of approximately 2.1 million (1.85 million)
Engine Equivalents, the increased shipment of 40,700 (38,200) Sampling Cups
and favourable exchange rates. Equipment revenue amounted to SEK 0.4 million
(SEK 1.1 million) following the sale of equipment to an existing European
customer to increase production capacity. Engineering Service amounted to SEK
0.2 million (SEK 0.3 million) following support provided to various customers
globally and the sale of test pieces.

TheJanuary-
December
2015
revenue amounted to SEK 72.4 million, surpassing the full year revenue record
of SEK 54.5 million established in 2014. The revenue from series production
increased by 33% to SEK 63.6 million (SEK 47.8 million) due to an 18%
increase in the full-year series production, a 15% increase in Sampling Cup
shipments, and favourable exchange rates. Equipment revenue amounted to SEK
7.7 million (SEK 4.9 million), primarily derived from Mini-System 3000
installations at Doosan Infracore in Korea, at an undisclosed foundry in
Japan, at Dongfeng in China, at Teksid in Portugal, and the System 3000Plus
installation at Asimco in China. Engineering Service amounted to SEK 1.0
million (SEK 1.4 million). The revenue from the leased installations is
accrued over the lease period.

Results
The business activities of SinterCast are best reflected by the Operating
Result. This is because the "Result for the period after tax" and the
"Earnings per Share" are influenced by the financial income and costs and by
the revaluation of tax assets.

----------------------------------------------------------------------------------------
| Results Summary October-December January-December |
| (Amounts in SEK million if not otherwise stated) 2015 2014 2015 2014 |
| Operating Result 4.4 3.5 20.3 10.2 |
| Result for the period after tax* 9.0 3.7 25.2 12.3 |
| Earnings per Share (SEK), from operations 0.6 0.5 2.9 1.4 |
| Earnings per Share (SEK)* 1.3 0.5 3.6 1.7 |
----------------------------------------------------------------------------------------

*
During the fourth quarter, the parent company settled its debts toward its
subsidiaries in US and UK. To minimise cashflow effects, the settlement was
made by offsetting receivables against repayment of equity and shareholder
contribution. The parent company has reversed previous impairment losses
related to these investments. The reversal, including accumulated translation
differences related to these holdings, is disclosed in the income statement
as financial income (SEK 15.3 million). The reversed accumulated translation
differences have been reclassified from other comprehensive income (SEK -4.5
million...

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