Electronics Production |
Neways: 3Q turnover & results in line with expectations
EMS-provider Neways has realised a substantially lower turnover in 3Q compared with the same period in 2008 in line with earlier announced expectations. The operating result was negative in July and August, but was slightly positive in September. Both turnover and the order intake have markedly increased since September.
The cost reduction programme that was earlier initiated and implemented has been effective and has led to an improvement in the operating result compared with the second quarter of 2009.
Cost reduction programme and financial position
The now largely effectuated cost reductions will lead to a (net) turnover break-even level between EUR 190 and EUR 195 million as per year-end 2009.
In the third quarter, the strict cash flow and working capital management has led to a more efficient use of resources and a shortening of the balance sheet. The financial position of Neways remains strong with a solvency of more than 43%.
Outlook
Neways is moderately positive about the fourth quarter and the first months of 2010. A demand recovery in the semiconductor and automotive sector was largely responsible for the increased order intake. This increase does certainly not apply to all market sectors. Therefore, a broad recovery in the Electronic Manufacturing Services market is not yet apparent.
It is expected that the fourth quarter will be better than the previous three quarters. The actual level of improvement will however depend on year-end effects. Based on these considerations, Neways expects the net result in the second half to improve compared with the first half of 2009.
