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Engineering – Full order books at Komax – profit declines News

Thursday, August 24th, 2017 | Economy

Delays in the implementation of high order intake prevented higher sales; Higher costs and a value adjustment pushed the profit downwards.
Consolidated sales fell by 0.8% to CHF 194.7 million. Since the accounting has been converted to Swiss GAAP FER, the results of the Medtech business unit sold in the first quarter of 2016 are included in the figures for the previous year, with sales accounting for 19.2 million 8.7% as announced by the company on Thursday.
Waiting for deliveries
Order intake rose by a good 22% to CHF 224.4 million. This results in a book-to-bill ratio of 1.15. The high rate was due to the fact that several orders had already been produced, but had not yet been delivered. They are not yet included in sales.
This concerns both larger plants and serial machines produced in Switzerland for the rapidly growing Asian market. In this context, the company speaks of a "delayed sales performance", but sees in the high order intake a proof for the expansion of the market position.
EBIT fell by a good 16% to CHF 25.4 million and the EBIT margin by 240 basis points to 13.1%. The strong growth, newly introduced products as well as the changed product mix had pushed profitability. The costs were also influenced by higher depreciation and the introduction of the new ERP system. In addition, the number of employees had risen sharply.
allowance
Reinsurance after tax was 18.6 million, a drop of almost 19%. For this purpose, the company is responsible for an extraordinary value adjustment of CHF 1.9 million, which was made for a loan granted to an associated company.
With the figures presented, the company has exceeded expectations with the order intake and also surpassed the sales figures, but missed the profit figures.
"The need for automation solutions continues to grow and our customers are eager to relocate manual operations to machines," the CEO, Matijas Meyer, cites. He also describes the market environment as positive. This dynamic in the first half of 2017 was particularly high in the Asia / Pacific region and in Europe (including Africa).
However, the North / South America region remained below expectations. There has been a lag in investment spending for months. In the first half of the year, therefore, non-profitable activities were discontinued in the USA and staff were reduced accordingly.
Order give confidence
The market launch of the new machine platform Alpha 530/550 in the core business of Komax (crimp to crimp) contributed to the successful expansion of the market position. The new machines had replaced the previous products, which had been optimized for years in the production, more quickly than expected. However, this detachment process, the overall product mix and the intense competitive environment, which were compared with the previous year, also had a negative impact on profitability.
For the second half of the year, Komax expects a result that will be higher than that of the first semester. This is attributable to the high level of order backlog as well as the continued dynamic in the automotive industry.
(AWP)

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