PCB | November 12, 2010

Schweizer Electronic shows sucsess in Q3

In its third quarter of the current fiscal year 2010 Schweizer Electronic was able to continue and even accelerate the positive business and revenue development which already started mid of 2009.
Orders, sales and results even improved compared to previous quarters. The company fully benefited from the general economic recovery in the areas of automo- tive and engineering. The growing area of solar electronics again accounted for a positive business development above average. This customer segment is subject to seasonal dy-
namics especially in the months of summer. Despite partially significant price increases in materials, results could be kept stable compared to the previous quarter.

Despite holiday season the company achieved a record sales in its third quarter of 28.1 Mio. EUR (before reduction in earnings of 28.6 Mio. EUR). The sales increase of 49% compared to the same quarter of the previous year was generated by all customer segments.

12 % of our sales volume in the third quarter was processed by our strategic partner Meiko Electronics. This represents a significant increase compared to previous quarters: in the first quarter Meiko’s sales share was only 0.2% and 3,7% in the second quarter.

From an economic point of view, the first two quarters of the fiscal year 2010 had been successful for Schweizer Electronic. This development continued in the third quarter. In our third quarter we achieved an EBITDA (earnings before interest, taxes, depreciation and amortisation) of 5.2 Mio. EUR, corresponding to a margin of 18% (previous year 14%). Compared to the previous quarters, this margin is stable and shows that a partially significant increase in material prices could be counterbalanced by according measures.

EBIT (earnings before interest and tax) even increased and amounted to 4.1 Mio EUR or 14 % in the third quarter EUR (previous year 8%). Due to a cautious investment policy over the last months, the amount of depreciations was 1.1 Mio. EUR in the third quarter (previous year 1.2 Mio. EUR). This does not include depreciations caused by revaluations of the capital assets in the second quarter amounting to 250K EUR, which – for comparison reasons - we report as special item.

Schweizer Electronic assumes that the positive development of the first nine months of this year can be continued in the fourth quarter – even despite a seasonally weaker fourth quarter usually experienced in this industry. We expect that the upward dynamics following the boom of the past months that was partially caused by refilling inventories, will be lowered to a normal level at the beginning of the year 2011.

Due to measures taken early in order to increase competitiveness, improvement and flexibility of cost structures and an attractive product and performance portfolio, we are confident to gain further market share.'

We will strengthen our position in our technology site Schramberg by shifting our portfolio towards high value products within our innovation building blocks. Investment into new technologies and reduction of bottleneck areas have been implemented and will gradually be accelerated in line with market developments. Required buildings and infrastructure
are already existing.

Schweizer Electronic intends to grow by volume increase in mass production. Our strategic partner Meiko Electronics is increasing its capacities in the current calendar year 2010 by 50 % – major part of which has been achieved already. In 2011 a further capacity increase is planned in China as well as the start of production of a volume production site in Vietnam. Schweizer Electronic will dispose of a defined and significantly increasing production corridor.


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