Phoenix Mecano Group's provisional accounts for 2012
Result impacted by one-off expenses; continued investment in technologies and
Kloten/Stein am Rhein, 15 February 2013. In the financial year just ended, the
Phoenix Mecano Group's provisional consolidated gross sales fell by 5.5% to
EUR500.5 million. Unaudited net sales were EUR495.6 million, with positive
currency effects accounting for 1.7%. Excluding changes in the scope of
consolidation, sales were down by 6.2%. The main causes of the decline in
sales were the downturn in the photovoltaic components market in the reporting
year and the weakness of the industrial components market in Europe due to the
sovereign debt crisis. By contrast, the American and Asian markets were
Consolidated incoming orders in the reporting year totalled EUR506 million,
corresponding to a book-to-bill ratio of 101.1%.
Operating result and result for the period under review
Provisional operating result (EBIT) fell by 22% from EUR36.1 million to around
This result includes the one-off charges, reported in September 2012, linked
to an impairment of fixed assets and losses on goods and production materials
in the photovoltaic components business totalling approximately EUR8 million.
This was caused by the general weakness of the photovoltaic market and the
cancellation of a multi-annual supply contract with a major customer. In the
industrial business, the margin was squeezed by a moderate decline in sales
combined with a high share of fixed costs, unfavourable changes to the product
mix and a comparatively high wage settlement in the key market of Germany.
The operating margin (unaudited) was 5.6%, compared with 6.8% the previous
year. Excluding one-off items, the EBIT margin was 7.2%.
The provisional operating cash flow (EBITDA) decreased by 20% to around
EUR54.5 million. The (not yet audited) figures indicate a result for the
period of approximately EUR18 million.
Development of the Group's divisions
The Enclosures division remained the Group's best performing division in terms
of income and margin. However, it was operating in a challenging environment.
The sovereign debt crisis in Europe dampened appetite for investment among
export-oriented customers in core markets such as Germany and Switzerland. The
eurozone's Mediterranean members slid into recession, resulting in reduced
demand and increasing numbers of customer insolvencies. The economic downturn
in China led to project delays in the renewable energy and machine tool
manufacturing sectors. Explosion-proof enclosures for the oil and gas industry
continued to perform well, particularly in Asia and Russia. Business in North
and South America was stable.
The Mechanical Components division saw slight increases in sales and income in
electrically adjustable comfort and healthcare furniture and medical
technology (DewertOkin), with Asia and North America in particular generating
growth. However, the capital goods markets (RK Rose&Krieger) were depressed,
mainly by the sluggish economic situation in Europe.
The ELCOM/EMS division had to cope with a marked reduction in demand in the
renewable energies market in 2012, especially in the photovoltaic sector. This
was compounded for Phoenix Mecano by a customer cancellation of a long-term
supply contract for chokes and transformers used in solar inverters.
Electrotechnical components for general industrial applications were also
negatively affected by the weak economy in Europe. However, demand for
high-performance power supply units for science and research applications in
the USA developed positively.
General industrial activity slowed in the second half of 2012. Sectors such as
the automotive and photovoltaic industries and parts of the general mechanical
engineering industry are cautious in their outlook for 2013. At the same time,
a number of leading indicators have started to pick up again, fuelled by
mounting confidence that the eurozone has - in the short term at least -
acquired greater control over its sovereign debt problems. If this confidence
is sustained over a longer period, there is a strong evidence to suggest that
the economic environment for capital goods will gradually improve in 2013. For
the time being, Phoenix Mecano remains cautious in its expectations. The focus
of our investment decisions is on the long-term improvement of our processes
and market positions. After a weak second half of 2012, the Group has had a
generally solid start to 2013. Optimisation projects such as the relocation of
logistics processes at DewertOkin (Germany) to Hungary and the development of
electromechanical components production in southern China (through the
acquisition of Bond Tact) are being rigorously pursued. Our excellent equity
ratio of over 60% allows us to make further strategic bolt-on acquisitions.
The share buyback programme of up to 10% of shares outstanding, scheduled to
run until 2015, is being continued. Even in the current challenging climate,
our ability to pay dividends can be considered as secure in the long term.
Dates for your diary:
Balance sheet media conference 25 April 2013 9.30 a.m. Widder Hotel, Zurich
Financial analysts' conference 25 April 2013 11.30 a.m. Widder Hotel, Zurich
For more information, please contact:
Phoenix Mecano Management AG
Benedikt Goldkamp / CEO
Lindenstrasse 23, CH-8302 Kloten
Tel.: +41 (0)43 255 4 255
Phoenix Mecano is a leading technology company active in the production of
enclosures and industrial components.
Media release (PDF)
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