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© jultud dreamstime.com Electronics Production | November 05, 2013

Neways sees continued recovery in results

Neway's third quarter of 2013 saw a further improvement of the positive trend already seen in the Electronic Manufacturing Services (EMS) market in the second quarter.
This contributed to the continued improvement in Neways’ results in the third quarter compared to the second quarter of 2013. The order portfolio confirms this, as this stood at EUR 72.5 million as per 30 September 2013, up almost 3 million euro from 30 June 2013. Profitability was considerably higher than in the third quarter of 2012, on a slightly lower turnover of EUR 68.4 million in the third quarter of 2013 (Q3 2012: EUR 69.5 million).

The generally positive trend in the EMS market seen in recent months, together with the closure and transfer of the activities of the operating company in Echt (NEE) contributed to a further optimisation of the capacity utilisation that began in the first half of the year. The transfer of all NEE clients to other operating companies within the Neways group has now been completed. The imbalance in capacity utilisation has largely been reduced at the majority of the Neways operating companies in recent months. The focus will now be on structurally raising the capacity utilisation. We will also continue to increase the flexibility of the organisation, including a more flexible deployment of manpower.

As announced on 15 September of this year, a major fire led to the cessation of all production facilities at Neways Electronics Kassel (NEK). The production activities on behalf of clients have been transferred to other Neways operating companies, and the transfer of activities is progressing according to plan. Our focus is now on issues such as the availability of materials to execute contracts for clients. Neways is in constructive talks with the company insurers and can rule out any negative impact on the company’s results.

Outlook

The outlook for the second half of the year has continued to improve, based on the results in the third quarter and the good start to the fourth quarter. Despite the volatility that is typical for the EMS market, current developments provide sufficient grounds to attach greater predictive value to the continuing healthy order portfolio.

Based on the above-outlined positive developments and current market outlook, Neways expects to report an excellent second half of the year. We expect the net result (excluding exceptional income and expenses) in the second half of the year to largely exceed the result recorded in the first half of the year.

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