© anthony bolan dreamstime.com
Electronics Production | October 31, 2012
Incap with EUR 0.04 million net profit
The operating profit (EBIT) for July-September was approximately EUR 0.3 million, i.e. clearly better than in the corresponding period last year.
Sami Mykkänen, President and CEO of Incap Group:
"The company's strategic restructuring that has lasted for several years has been completed in the summer, when the Helsinki factory's production was transferred to the company's other factories. Incap now has one factory in each country where it operates - Finland, Estonia and India - which provides a good foundation for improving profitability and competitiveness."
"The demand for energy efficiency sector's products has stayed on a pleasing level during the reporting period in both Europe and Asia. Revenue of the Indian operations has increased more than expected and production volumes have reached a profitable level. Deliveries of well-being technology products have decreased due to, among other reasons, some of the products being omitted from the production programme as expected."
"Improving profitability has been our main target, and recent profit development shows that we have succeeded in laying a sustainable foundation for growth in accordance with our strategy. We expect the favourable development to continue and estimate that the operating profit (EBIT) for the second half of the year will be positive."
"The comprehensive financing solution negotiated in the spring stabilised our financing structure. We are currently preparing for the redemption of the convertible bond agreed upon in the spring, which is supposed to take place during 2012. Our original intention was to finance the redemption through a share issue in the autumn, but we are currently also investigating other possible financing tools."
Revenue and profitability July-September 2012
Revenue for the third quarter amounted to EUR 15.7 million, down 14% year-on-year. The decrease in revenue was mainly due to certain products manufactured at the Helsinki factory being omitted from the production programme. Revenue from customer accounts served from the Indian plant has increased more than expected, by 37%, especially with international but also with locally operating customers.
The operating profit (EBIT) for July-September was approximately EUR 0.3 million, i.e. clearly better than in the corresponding period last year. The operating profit was positive, as it also was in the previous quarter in April-June. Measures to lower costs were continued, and the decrease in personnel costs and other fixed costs had a positive effect on profitability.
The expanded premises of the Kuressaare property entered production use, which will improve the factory productivity. Production activity at the Helsinki factory ended, and manufacturing of sheet-metal mechanics was transferred partially to the company's Vaasa plant and partially to subcontractors. The closure of the factory and centralisation of production in Vaasa and Kuressaare are expected to result in savings of approximately EUR 1.6 million in 2013, comprised mainly of personnel costs.
Some of the production equipment of the Helsinki factory was transferred to Vaasa, some was sold. The net gains from the sale of equipment are recognised under other operating income.
Revenue and profitability January-September 2012
Revenue for January-September amounted to EUR 49.6 million, down approximately 5% year-on-year. Deliveries to customers in the energy efficiency industry remained at a good level, and the demand for rotor components, inverters and UPS products has increased clearly. Revenue in Indian operations increased by about 35% year-on-year.
The operating result for January-September was EUR -0.05 million, which is almost a million euros better than the corresponding period for the previous year. Particularly the profitability in the Indian operations has developed strongly. Material expenses and other variable production costs decreased year-on-year, and also fixed costs went down. In order to improve the cost structure, Group Services, among other functions, were reorganised and tasks were centralised in the company's Tallinn office. Financial performance was burdened by expenses related to the closure of the Helsinki plant during the period under review.
Net financial expenses decreased compared to the previous year and amounted to EUR 0.2 million (EUR 1.7 million). The decrease was due to EUR 1.1 million of financing income recognised in June as the result of the dilution of the convertible bond. Depreciation stood at EUR 1.2 million (EUR 1.6 million). The loss for the period totalled EUR -0.3 million (EUR -2.7 million).
Personnel and management
At the close of the period, Incap Group had a payroll of 667 employees (772). Of the personnel, 56% worked in India (51%), 30% in Estonia (27%) and 14% in Finland (22%).
HR Director and member of the Group Management Team Kirsi Hellsten gave notice to accept a position with another company at the beginning of November.
Outlook for 2012
Demand in the energy efficiency industry remained at a good level in Europe and India. Revenue from well-being technology products will fall short of the previous year due to the discontinuation of certain products formerly manufactured in Helsinki and Kuressaare.
The closure of the Helsinki factory is the final stage in the company's strategic restructuring of production, which has formed a basis for profitable growth. Transferring the factory's production to other units and making operations more efficient will improve the company's profitability starting in the third quarter.
Incap reiterates its previous guidance published on 14 September. The company estimates that the Group's revenue in 2012 will be lower than the EUR 68.9 million achieved in 2011. Incap further estimates that the operating profit (EBIT) for the latter half of the year will be positive and full-year operating profit will be clearly better than in 2011, at which time it amounted to EUR -1.6 million.
"The company's strategic restructuring that has lasted for several years has been completed in the summer, when the Helsinki factory's production was transferred to the company's other factories. Incap now has one factory in each country where it operates - Finland, Estonia and India - which provides a good foundation for improving profitability and competitiveness."
"The demand for energy efficiency sector's products has stayed on a pleasing level during the reporting period in both Europe and Asia. Revenue of the Indian operations has increased more than expected and production volumes have reached a profitable level. Deliveries of well-being technology products have decreased due to, among other reasons, some of the products being omitted from the production programme as expected."
"Improving profitability has been our main target, and recent profit development shows that we have succeeded in laying a sustainable foundation for growth in accordance with our strategy. We expect the favourable development to continue and estimate that the operating profit (EBIT) for the second half of the year will be positive."
"The comprehensive financing solution negotiated in the spring stabilised our financing structure. We are currently preparing for the redemption of the convertible bond agreed upon in the spring, which is supposed to take place during 2012. Our original intention was to finance the redemption through a share issue in the autumn, but we are currently also investigating other possible financing tools."
Revenue and profitability July-September 2012
Revenue for the third quarter amounted to EUR 15.7 million, down 14% year-on-year. The decrease in revenue was mainly due to certain products manufactured at the Helsinki factory being omitted from the production programme. Revenue from customer accounts served from the Indian plant has increased more than expected, by 37%, especially with international but also with locally operating customers.
The operating profit (EBIT) for July-September was approximately EUR 0.3 million, i.e. clearly better than in the corresponding period last year. The operating profit was positive, as it also was in the previous quarter in April-June. Measures to lower costs were continued, and the decrease in personnel costs and other fixed costs had a positive effect on profitability.
The expanded premises of the Kuressaare property entered production use, which will improve the factory productivity. Production activity at the Helsinki factory ended, and manufacturing of sheet-metal mechanics was transferred partially to the company's Vaasa plant and partially to subcontractors. The closure of the factory and centralisation of production in Vaasa and Kuressaare are expected to result in savings of approximately EUR 1.6 million in 2013, comprised mainly of personnel costs.
Some of the production equipment of the Helsinki factory was transferred to Vaasa, some was sold. The net gains from the sale of equipment are recognised under other operating income.
Revenue and profitability January-September 2012
Revenue for January-September amounted to EUR 49.6 million, down approximately 5% year-on-year. Deliveries to customers in the energy efficiency industry remained at a good level, and the demand for rotor components, inverters and UPS products has increased clearly. Revenue in Indian operations increased by about 35% year-on-year.
The operating result for January-September was EUR -0.05 million, which is almost a million euros better than the corresponding period for the previous year. Particularly the profitability in the Indian operations has developed strongly. Material expenses and other variable production costs decreased year-on-year, and also fixed costs went down. In order to improve the cost structure, Group Services, among other functions, were reorganised and tasks were centralised in the company's Tallinn office. Financial performance was burdened by expenses related to the closure of the Helsinki plant during the period under review.
Net financial expenses decreased compared to the previous year and amounted to EUR 0.2 million (EUR 1.7 million). The decrease was due to EUR 1.1 million of financing income recognised in June as the result of the dilution of the convertible bond. Depreciation stood at EUR 1.2 million (EUR 1.6 million). The loss for the period totalled EUR -0.3 million (EUR -2.7 million).
Personnel and management
At the close of the period, Incap Group had a payroll of 667 employees (772). Of the personnel, 56% worked in India (51%), 30% in Estonia (27%) and 14% in Finland (22%).
HR Director and member of the Group Management Team Kirsi Hellsten gave notice to accept a position with another company at the beginning of November.
Outlook for 2012
Demand in the energy efficiency industry remained at a good level in Europe and India. Revenue from well-being technology products will fall short of the previous year due to the discontinuation of certain products formerly manufactured in Helsinki and Kuressaare.
The closure of the Helsinki factory is the final stage in the company's strategic restructuring of production, which has formed a basis for profitable growth. Transferring the factory's production to other units and making operations more efficient will improve the company's profitability starting in the third quarter.
Incap reiterates its previous guidance published on 14 September. The company estimates that the Group's revenue in 2012 will be lower than the EUR 68.9 million achieved in 2011. Incap further estimates that the operating profit (EBIT) for the latter half of the year will be positive and full-year operating profit will be clearly better than in 2011, at which time it amounted to EUR -1.6 million.
Chinese memory companies arrange trial production to begin in 2H/18
China has entered the semiconductor sector and focused on the development of domestic memory industry. The three key players are YMTC, Innotron (Hefei Chang Xin) and JHICC, which work on NAND Flash, mobile DRAM and...
Schweizer increase turnover to EUR 120.9 million
The Schweizer Group closed the accounts in 2017 with a record turnover of EUR 120.9 million...
Are we ready for Air Taxi Services?
Volocopter certainly believes we are. The German company presented a vision that integrates air taxis into existing transportation systems to provide additional mobility for up to 10'000 passengers per day with a single point to...
Flir Systems completes strategic investment in DroneSense
Flir has completed a strategic investment in DroneSense, the makers of a software platform...
Emerson to acquire Tools & Test equipment business from Textron
Emerson has signed an agreement to purchase the Tools and Test Equipment (Tools...
TTM completes acquisition of Anaren
PCB manufacturer, TTM Technologies has completed its acquisition of Anaren, Inc. The...
Robots create jobs – new research
At 309 units per 10'000 employees, robot density in German manufacturing industry...
EDA industry revenue up 10.7% YoY in Q4/2017
The Electronic Design Automation (EDA) industry revenue for Q4/2017 increased...
Cobham wins KF-X multirole fighter oxygen system contract
Cobham has received a contract from Korean Aerospace Industries Ltd (KAI) to design and supply a pilot Oxygen System for the future KF-X, an advanced multirole fighter aircraft currently under development.
PCB growth takes a break in February 2018
PCB manufacturers in the European D/A/CH region reported on February sales figures that were ten percent lower than those registered for January 2018. However, compared YoY, figures were 6.2 percent higher.
Tempo builds new factory in San Francisco
EMS-provider Tempo has closed a USD 20 million Series B financing round to increase its...
Manz with order from e-mobility sector
Manz has received an order for a standard production line from a European customer in the...
STI awarded the new Aerospace accreditation
UK based contract electronics manufacturer, Surface Technology International Ltd...
Finland wants to take the lead on the European battery market
Evertiq has over the course of the last year reported on several major investments regarding...
ABB and a smooth ride on water
The company has demonstrated a new futuristic, zero-emission new design of water taxi, called...
IPTE expands location in Romania
IPTE Factory Automation says that the company has expanded its production location in...
Fineline VAR acquires Prestwick Circuits
Fineline VAR Ltd, the UK subsidiary of Fineline Global, have acquired fellow UK...
Semiconductor leaders’ market shares surge over the past 10 years
The top-5 semiconductor suppliers accounted for 43% of the world’s semiconductor sales...
Scanfil to help Coloreel to disrupt the textile industry
Contract manufacturer Scanfil will manufacture the Coloreel Embroline which aims to...
List: Europe's biggest EMS providers 2017
Manufacturing Market Insider recently released its top 50 list of the worlds biggest EMS...
Most Read
Load more news
Comments