Interim report January - September 2017: Good growth continues and successful rights issue
- Order intake increased by 12% to 297.4 MSEK (266.3).
- Net sales increased by 7% to 289.1 MSEK (271.1).
- EBIT was 5.6 MSEK (4.7).
- Profit/loss after tax was -2.2 MSEK (-72.7 including impairment loss on shares in associated companies of 71.6 MSEK).
- Earnings per share were -0.09 SEK (-2.55).
- 225 MSEK rights issue completed on 6 October.
- Order intake increased by 14% to 922.1 MSEK (811.4).
- Net sales rose by 6% to 883.3 MSEK (834.9).
- EBIT was 14.6 MSEK (-46.6). Year-2016 earnings were charged with non-recurring expenses of 50 MSEK.
- Profit/loss after tax was -5.2 MSEK (-117.4).
- Earnings per share were -0.22 SEK (-4.10).
COMMENTS FROM PRESIDENT AND CEO PER SAMUELSSON
“In the third quarter, Beijer Electronics Group continued to deliver according to plan. Order intake and sales increased, and the fact that both business entities, Beijer Electronics and Westermo, are now achieving good organic growth, is noteworthy. With increased sales, we were able to lift earnings somewhat. We are now also focusing aggressively on product development, marketing and sales, resulting in increased expenses. This means that our operating margin remains too low. But progress is as planned and we are reiterating our goals of achieving 7% growth and a margin of 10% in late-2018.
The Beijer Electronics business entity is continuing on the path set, with increased order intake and sales. Earnings performance is being restrained by significant investments that will form the foundation of future growth. It is pleasing that the new operator panels in the X2 series, introduced in fall 2016, are continuing to achieve successes. Sales of the X2 series represented 20% of the business entity total in the third quarter, which makes the X2 series the business entitie’s most successful product launch to date. Our latest product, X2 extreme, was also launched in the third quarter. X2 extreme is designed for harsh environments, addressing segments where Beijer Electronics is well positioned, and this makes the X2 series complete. A fully standaloneversion of X2 extreme will also be launched in the fourth quarter. Accordingly, product development remains intensive. BoX2, comprising software and hardware, will be presented at the end of November, a product within our Internet of Things solutions that enables easy linkups of existing equipment to the cloud and other network solutions.
The Westermo business entity continued its positive progress with healthy order intake and sales growth, and satisfactory earnings in the third quarter. Within the Train segment, demand for IP Train was firm, mainly from current business customers purchasing more equipment. The pattern follows a project lifecycle, where new business customers start on a small scale, piloting and evaluating products, and given a positive outcome, orders increase. Positive sales growth in the quarter confirms Westermo’s international competitiveness. Westermo secured a breakthrough order in Australia with BHP Billiton, one of the world’s largest mining corporations, as end-customer. This order is for communication equipment for 178 rail engines, which can be managed and remote-controlled from a single control center.
The Korenix business entity continued work on realigning its organization, a process that affected order intake, sales and earnings in the third quarter and the nine-month period overall. The new structure and organization has been adapted to the new product range in segments including wireless data communication. The orientation is more towards software, focusing on customer benefit. We are very hopeful of a progressive improvement of order intake and sales over the next 6-9 months.
In early October, we successfully completed the rights issue we announced in July, which was 1.6 times oversubscribed. This rights issue raised 217 MSEK net for the Group and consolidates Beijer Electronics Group’s financial position. We appreciate the support and trust our shareholders have shown in the Board and Management in their continued work on developing the Group. This capital injection will give us more room to act and the potential to raise our development tempo further, through channels including smallscale acquisitions.
Simultaneously, we are making changes to management. Jenny Sjödahl will become President of Westermo effective 1 November. Jenny has long-term experience with ABB, and has been Vice President of Sales for Westermo since 2016. I’m looking forward to continuing to develop Westermo alongside Jenny. Lars-Ola Lundqvist will leave his position as President of Westermo after ten successful years, and will now be taking on a role in Business Development, focusing on activities at Group level.
We are reiterating our previous outlook for the full year 2017. We expect the Group to be able to achieve higher sales and better underlying EBIT compared to 2016.”
INVITATION TO CONFERENCE CALL
Today, a conference call will be held for press and analysts, where President and CEO Per Samuelsson and CFO Joakim Laurén present the company and comment on the report.
Time: Wednesday October 25, at 10.30 a.m. CEST
To participate in the conference please dial:
From SE: +46856642698
From UK: +442030089804
To access the presentation please use this link:
The report and the presentation will be available at Beijer Electronics Group’s website www.beijergroup.com. A recording of the conference call will also be available here after the event.
For more information please contact:
President and CEO, Per Samuelsson, tel 46 (0)40 35 86 10, mobile 46 (0)708 58 54 40
CFO Joakim Laurén, tel 46 (0)40 35 84 96, mobile 46 (0)703 35 84 96.
This information is such that Beijer Electronics AB (publ) is required to disclose in accordance with the Swedish Financial Instruments Trading Act and EU's Market Abuse Regulation (MAR). The information was submitted for publication at 08:00 CET, October 25, 2017.
Beijer Electronics Group is a fast growing technology company with extensive experience of industrial automation and data communication. The company develops and markets competitive products and solutions that focus on the user. Since its start-up in 1981, Beijer Electronics Group has evolved into a multinational group with sales over 1.1 billion SEK 2016. The company is listed on the NASDAQ OMX Nordic Stockholm Small Cap list under the ticker BELE. www.beijergroup.com