RAUTE CORPORATION INSIDE INFORMATION October 16, 2020 at 3:30 p.m.
RAUTE RECEIVED ORDERS WORTH APPROXIMATELY EUR 55 MILLION TO RUSSIA
Raute Corporation has received orders worth approximately EUR 55 million from LLC Plitwood to Russia. The scope of orders includes all machinery and equipment for the production process of an entire plywood mill and also services related to the installation, commissioning and production start-up of the mill. The machinery and equipment will be delivered to a green field plywood mill to be set up in the Vologda area. The city of Vologda is situated 650 kilometers east of St. Petersburg. The annual capacity of the new mill will be approximately 180 000 cubic meters birch plywood. The ordered machinery and equipment will be delivered during the end of the year 2021 and beginning of the year 2022. The production in the plywood mill will start during the year 2022. The equipment will be engineered and produced in Raute's units in Nastola, Shanghai and Kajaani, and also in the company’s partnership network. This order is one of the biggest single orders ever in Raute’s history.
LLC Plitwood is a company established in 2017 for this project. Its principal owners are AO CHFMK (Cherepovets Plywood-Furniture Plant) and LLC VLP (Group of Companies “Vologodskiye lesopromyshlenniki” – Vologda forest industry enterprises). Even though the company is new, it has more than 60 years’ strong experience in wood processing and plywood industry in its background.
Raute's experience in resource-efficient technology, delivery capability and the company’s local presence and service network in the Russian market had an influence when selecting the supplier. The scope of the order serves as a proof of Raute’s leading know how on the plywood production process.
The work resulting now in this order was already started in 2019 with the quotation process. However, main part of the work was done during the corona pandemic. Due to the exceptional circumstances we were forced to carry out the negotiations almost entirely through remote connections, what becomes to both concerning the technical solutions and contractual terms. Succeeding in that required excellent flexibility from all those involved in this both at Plitwood and Raute. Further, succeeding in this shows that the “digital leap” forced by the pandemic is reality also for Raute and Raute’s customer base.
The orders now received have no impact on Raute's outlook for 2020 but improve and strengthen outlook for 2021. Raute’s net sales for 2020 are expected to decrease compared to 2019 and operating profit is expected to weaken clearly year-on-year.
President and CEO
Mr. Tapani Kiiski, President and CEO, mobile phone +358 400 814 148
Nasdaq Helsinki Ltd, main media, www.raute.com
RAUTE IN BRIEF:
Raute is a technology and service company that operates worldwide. Raute’s customers are companies operating in the wood products industry that manufacture veneer, plywood, LVL (Laminated Veneer Lumber) and sawn timber. Its technology offering covers the entire production process for veneer, plywood and LVL and special measurement equipment for sawn timber. As a supplier of mill-scale projects, Raute is a global market leader both in the plywood and LVL industries. Additionally, Raute’s full-service concept includes technology services ranging from spare parts deliveries to regular maintenance and equipment modernizations. Raute’s head office is located in the Nastola area of Lahti, Finland. The company’s other production plants are located in Kajaani, Finland, the Vancouver area of Canada, the Shanghai area of China and in Pullman, Washington, USA. Raute’s net sales in 2019 were EUR 151.3 million. The Group’s headcount at the end of 2019 was 778. More information about the company can be found at www.raute.com.