Neways books higher turnover and profit in 1Q

Net profit also increased compared to the fourth quarter of 2010. This is a clear sign that the positive developments noted in 2010 are continuing in 2011. The order portfolio grew to EUR 75.3 million, an increase of 4% compared to year-end 2010. Neways activities in the Electronic Manufacturing (EMS) market showed growth across the board. The continued increase in market demand means several suppliers are as yet unable to fully meet their delivery obligations. Neways also expects the disastrous events in Japan to have an effect in the coming months. The supply situation meant Neways also faced some pressure on the results in the first three months of the year. However, compared to both the first and fourth quarters of 2010, a higher net profit was realised in the first three months of 2011. In the coming months, Neways will continue to focus on the introduction of efficiency improvements and thus the reduction of the relatively high cost levels as a result of the aforementioned disruptions, which are affecting the entire chain. In order to provide more added value and respond more efficiently to market trends and the needs of its clients, such as Original Equipment Manufacturers (OEMs), the planned acquisition of the electronic development activities of consultancy and engineering firm DHV was announced early April. What this means in effect is that the 54 DHV engineers will transfer to Neways. The transaction is an excellent fit with Neways strategy, which includes the further expansion of its development and engineering business. The acquisition will be financed from own resources and is expected to make an immediate contribution to Neways’ results. The annual turnover from these activities is around EUR 4 million. In addition, Neways has expanded its 90% stake in its subsidiary Neways Micro Electronics in China to 100%. The shares were acquired from a Chinese government body. Neways’ financial position remains strong. However, the significant increase in order and activity levels put some pressure on working capital. Outlook The first quarter results created an even stronger foundation for the previously expressed forecast for 2011. Partly on this basis, plus the order portfolio growth and strong increase in demand, turnover and profit for the full year 2011 are expected to exceed those of 2010 by a considerable measure.