Ad
Ad
Ad
Electronics Production | February 13, 2009

EB with net sales increase of 11.1% in 4Q

The company's net sales amounted to €49.5 million (€44.6 million, 4Q 2007), representing an 11.1% increase year-on-year. Operating loss from business operations amounted to € -2.8 million and the non-recurring restructuring costs and write-offs totaled to € -5.7 million, resulting in a total operating loss of € -8.5 million (€ -2.4 million, 4Q 2007).
Operating loss from business operations shows clear improvement sequentially from € -11.3 million (3Q 2008) to €-2.8 million (4Q 2008). Operating cash flow amounted to € -0.5 million (€ -8.6 million, 4Q 2007). The net cash flow amounted to €1.4 million (€ -10.8 million, 4Q 2007). The equity ratio remained at a high level of 64.9% (70.9%, 4Q 2007).

EB's profit improvement and cost structure adjustment program launched in fourth quarter 2008 is targeting in total of €40 million annual cost savings in comparison to the cost level of the first half of 2008.

EB's CEO Pertti Korhonen states: "EB was able to improve profitability by reducing the operational losses from business operations € -11.3 million in third quarter of 2008 to € -2.8 million in the fourth quarter of 2008. Going forward we continue to focus on profitability improvement as our first priority while continuing to invest in the future opportunities in a sustainable manner."

Events after the reporting period
EB exited from RFID technology business in the beginning of February 2009 by selling 7iD Technologies GmbH to the acting management of the said company in Austria. RFID business has been part of Wireless Sensor Solution business in EB. Due to this transaction Wireless Sensor Solution business ceases to exist. The write-offs caused by the transaction are included in the earlier announced (20 November, 2008) maximum EUR 5 million non-recurring restructuring costs and write-offs for the second half of 2008. The transaction will not have significant impact on EB's balance sheet or result.

Actions to improve profitibility
EB's profit improvement and cost structure adjustment program launched in fourth quarter 2008 and targeting in total for EUR 40 million annual cost savings in comparison to the cost level of the first half of 2008, is proceeding as planned. The cost savings measures totaling to EUR 30 million have been completed during 4Q 2008 and are gaining their full impact from the beginning of 2009. The additional measures targeting to EUR 10 million savings have been mostly identified and are currently being implemented.

EB has concluded the actions to reduce personnel by 115 of the targeted reductions of 170 employees globally by the end of the first half of 2009. Earlier in October EB reduced its personnel in support functions by 42 employees. EB has also agreed upon a maximum of 6 week's temporarily dismiss of employees in Wireless Communications Tools.

Outlook for 1H/2009
Current economic downturn and turbulence in all markets is making forecasting challenging and the visibility is short. Based on the current limited visibility, EB expects that the turnover of the first half of 2009 will be on the same level or lower as in the second half of 2008 (EUR 84.0 million). The announced annual EUR 40 million cost savings actions will continue to gain effect during the first half of 2009 and consequently the profitability of the first half of 2009 is expected to improve significantly compared to the operative result of the second half of 2008 (EUR -14.1 million).

Comments

Please note the following: Critical comments are allowed and even encouraged. Discussions are welcome. Verbal abuse, insults and racist / homophobic remarks are not. Such comments will be removed.
Further details can be found here.
Load more news
August 22 2017 10:36 AM V8.6.0-2