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SMT & Inspection | February 20, 2009

Weak SMT-market impact Mydata sales

The total market for surface-mounting machinery declined heavily during the fourth quarter and total sales were more than halved compared with each of the three prior quarters in 2008. This has also affected Sweden based SMT-maker Mydata.
The largest relative decrease affected the markets in the US, China and Southeast Asia. The limited market visibility experienced by most customers, in combination with restrictive lending from the credit market, is inhibiting investment in new surface-mounting machinery.

During the fourth quarter, demand in Europe for the MY500 Jetprinter was favorable, despite the prevailing market conditions. Due to the weak market trend in the fourth quarter, Mydata implemented cost savings that also resulted in a downsizing in the number of employees, in order to align the operations to lower demand for surface-mounting machinery. However, the ongoing strategically important development projects were able to continue as planned. In June, Mydata acquired its German distributor Royonic, which was consolidated in Mydata’s financial statements as of June with a marginal impact on earnings.

During the fourth quarter, net sales totaled SEK 168 m (152), up 11 percent. Excluding currency effects, the year-on-year decrease was 2 percent. Full-year net sales amounted to SEK 625 m (622). During the fourth quarter, order bookings totaled SEK 140 m (164), down 15 percent. Excluding currency effects, the year-on-year decline was 29 percent. Full-year order bookings amounted to SEK 592 m (636), down 7 percent. Excluding currency effects, order bookings declined by 7.5 percent compared with 2007. Order bookings for MY 500 amounted to SEK 25 m (4).

The operating result amounted to a loss of SEK 19 m (loss: 15) for the fourth quarter and a loss of SEK 31 m (profit: 12) for the full year. R&D amounted to 18 percent (20) of fourth-quarter sales and 18 percent (18) of full-year sales. Expensed R&D amounted to SEK 30 m (31) during the fourth quarter and SEK 110 m (111) during the year.

Cash flow from operating activities was a negative SEK 64 (pos. 12) during the year, including a positive SEK 1 m (pos. 1) during the fourth quarter. The launch of new products, including the preparation of production and machinery for customer demonstrations, had an adverse impact on cash flow, mainly during the first half of the year. During the fourth quarter, the adaptation of inventory levels to the prevailing market conditions, in combination with a continued stable level of customer credit days, resulted in a decrease in tied-up capital and a positive cash flow.

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