Stein am Rhein/Kloten
Consolidated gross sales were virtually the same as the previous year at €256.1 million (2013: €256.3 million). Excluding effects from changes to the scope of consolidation, there was a decline of 0.8%. Negative currency effects depressed sales in euro by 1.6%.
Net sales totalled €253.6 million (previous year: €253.9 million). Incoming orders were down by 3% to €254.9 million, corresponding to a book-to-bill ratio of 99.5%. This suggests the sideways trend will continue in the coming months.
The operating result was down by 10.8% to €17.4 million, due primarily to a number of one-off special items. The Enclosures division, which is geared towards industrial markets, saw its margin increase slightly. However, in the DewertOkin arm (Mechanical Components division), increased costs arising from patent disputes and the impairment of inventories due to customer-side project delays led to a slight fall in the operating margin. The operating result was also impacted by the costs of setting up new business areas in connection with the realignment of the ELCOM/EMS division.
Operating cash flow fell by 3.7% to €28.7 million (previous year: €29.7 million).
The result of the period after taxes was €11.4 million, compared with €13.8 million the previous year, a reduction of 17.5%. This decline was greater than that of the operating result, mainly due to an increased tax rate caused by a less favourable mix of earnings contributions from countries with different taxation levels. The effective tax rate was 30.6%, compared with 25.4% the previous year.
Net indebtedness increased from €12.4 million at
Development of the Group's divisions
The Enclosures division increased its gross sales by 3.9%, ending the negative trend of the past two years. The operating margin rose to 15.3% from 13.5% the previous year. The membrane keyboards and touchscreen systems market remains challenging due to massive technological changes, which pose a range of challenges for interface integration service providers such as
The Mechanical Components division operates in the field of industrial automation technology via its Rose+Krieger product area. The DewertOkin product area supplies control and drive solutions for electrically adjustable comfort furniture and hospital/care beds. The division recorded a 1% fall in sales in H1 2014, from €120.1 million to €118.9 million. In this segment too, the industrial business in linear positioning systems and aluminium profile assembly systems proved relatively robust. By contrast, the DewertOkin arm, which has grown strongly in recent years, was hit by project delays and reduced demand from end markets in the second quarter of 2014, particularly in the important US market.
The ELCOM/EMS division posted a decline in sales of 4.1%. Performance varied within the division's three main product areas. Electromechanical components enjoyed a generally stable market environment. These components (switches, connectors) face particular challenges from high wage inflation in
Electronic packaging put in a stable performance in the general industrial sector. The environment for physics research and security industry projects proved more difficult, with a number of big projects suffering delays.
In the power quality segment, there was increased expenditure on expanding the sales network and the product range for instrument transformers. In this connection,
For the most part, industrial leading indicators remain positive worldwide. However, in the eurozone, and particularly
Further challenges are posed by the realignment of the ELCOM/EMS division, linked to the integration of bolt-on acquisitions Phoenix Mecano SMS and
For the current year, against the backdrop of these estimates, it seems realistic to forecast Group sales in the region of those achieved last year, and an operating result on a par with last year's, once adjusted for one-off charges and set-up costs for new business areas. One-off charges and set-up costs in the mid-single-digit million range will probably result in the unadjusted result for the year as a whole falling below that of the previous year. However, in keeping with the long-term dividend policy, such special items will not be taken into account when calculating the amount to be distributed. If the upturn in industrial activity were to gain momentum in the second half of the year, this would have a positive impact on the
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Results first half of 2014 in figures (in EUR million)
Operating cash flow
Media release (PDF)
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