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Electronics Production | May 07, 2008

Elektrobit reports 53% growth year-on-year

EB's Q1/08 net sales increased 52.9 to €47.3 million, compared with €31.0 million in Q1/07. The net sales included extraordinary low-margin through-licensing revenues of approximately €3 million.
Operating loss for the first quarter, including the non-recurring restructuring costs of EUR 2.9 million as announced in March 27, 2008, amounted to EUR -8.0 million (EUR -7.2 million).

The restructuring costs of EUR -2.9 million include the rearrangements in the Wireless Business Segment (cost provision of approximately EUR 2.2 million) and the sale of the shares of EB's Swiss subsidiary, Elektrobit AG (a capital loss and a write-off totalling in aggregate approximately to EUR 0.7 million).

The net sales of the Automotive Business Segment during the first quarter of 2008 amounted to EUR 15.5 million (EUR 10.6 million), representing a year-on-year growth of 45.8 per cent. The operating loss was EUR -1.6 million (EUR -0.6 million), reflecting the significantly increased investments in the R&D of EB's automotive software platform products, in accordance with the strategy, as well as marketing and sales investments to expand the business globally.

During the first quarter of 2008, the net sales of the Wireless Business Segment, including the aforementioned extraordinary low-margin through-licensing revenues of approximately EUR 3 million, amounted to EUR 31.7 million (EUR 20.1 million), representing a year-on-year growth of 58.0 per cent. The operating loss, including the aforementioned non-recurring restructuring costs of EUR -2.9 million, was EUR -6.5 million (EUR -6.4 million) reflecting the significant investments in the R&D of mobile WiMAX base station module products and RFID reader systems and the weaker than expected demand and strong price competition of the radio network solutions R&D services.

Overall, EB continued significant investments in research and product development, in order to develop new businesses in line with the strategy, with the share of investments in the Automotive Business Segment growing.

Regarding the sale of Network Test business in November 2006, based on certain financial performance targets achieved between January 1, and December 31, 2007, an additional purchase price component of EUR 0.4 million will be payable to EB in the second quarter of 2008. Regarding the sales price of the Production Solutions business, there is an additional purchase price component that will depend on the financial performance of 2007 and 2008. No additional payment for 2007 is due.

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