Electronics Production | March 10, 2011

Cicor returns to growth and profitability in 2010

Cicor Technologies, based in Boudry (Switzerland), has recovered from the crisis year of 2009 and posted a positive net result. Sales and profitability have both increased significantly.
In financial 2010 Cicor's net sales went up 14.3% to CHF 183.0 million (2009: CHF 160.1 million). Successful Group-wide measures to improve efficiency, allied to the higher volume of business had a positive effect on operating profit. Operating profit before restructuring costs improved by 126.6% to CHF 13.2 million (2009: CHF 5.8 million).

The EBITDA margin increased to 7.2% (2009: 3.6%) of sales. EBIT before restructuring came to CHF 5.3 million (2009: CHF -3.3 million). Costs totalling CHF 1.4 million arose in connection with the relocation of production and the repositioning of Systel SAat the Quartino (Switzerland) site. Net profit was restored to a positive result of CHF 0.1 million (2009: CHF -7.7 million). With an equity ratio of 57.5% at the end of 2010, Cicor is solidly financed.

The strength of the Swiss franc ‚Äď especially against the currencies that are particularly important to the Group, the euro and the US dollar ‚Äď had a negative effect on business results. This negative impact was mitigated by the Group's strong global presence, with production facilities in the Eurozone and Asia, and by its ability to allocate flows of goods effectively to the appropriate currency zones.

In 2010 Cicor made targeted investments in establishing and expanding its companies outside Switzerland. Challenging qualification phases were secured in the industrial and medical technology sectors, which should pave the way for significant additional sales in the years ahead.

Cicor also won several important large orders, including manufacturing electronics modules for position sensor systems, making modules in Asia for a well-known Swiss sewing machine manufacturer, and supplying complex substrates for use in radar systems. New orders showed a year-on-year increase of 25.1% to CHF 206.7 million (2009: CHF 165.2 million).

PCB Division: substantial progress

The PCB Division’s results improved markedly in 2010, with net sales up 23.3% on the year-back figure to CHF 36.5 million (2009: CHF 29.6 million). Operating profit before depreciation and amortization (EBITDA) was back in the black at CHF 2.7 million (2009: CHF -2.3 million), while EBIT came in at CHF -0.5 million (2009: CHF -6.0 million). The strength of the Swiss franc prevented a positive operating result at the EBIT level.

In 2010 the PCB Division created new key account management jobs and expanded its regional distribution network in North America. Challenging qualification phases with new customers in various client segments, particularly medical technology, were taken on in order to generate sales in the immediate future. The innovation that facilitates the use of PCB connections in three dimensions was also prioritized during the year under review.

ME Division: public sector restraint

In 2010 the ME Division recorded net sales of CHF 30.3 million (2009: CHF 32.6 million) and an operating profit (EBIT) of CHF 2.6 million (previous year: CHF 3.4 million). Orders from public sector clients did not begin to bounce back until the final quarter of the year under review. In the classic thin-film technology sector, defence contracting orders planned for the first half of the year were postponed, which is reflected in the results.

This late-cycle effect of the crisis was counteracted to a certain extent by increased demand for micro-system technology. Hefty increases in the thick-film, micro-assembly and module construction segments paved the way for record results in this part of the division.

ES Division: positive performance

In 2010 the ES Division’s net sales registered a year-on-year increase of 14.9% to CHF 93.8 million (2009: CHF 81.7 million). The operating profit (EBIT) before restructuring costs rose to CHF 3.9 million (2009: CHF 1.3 million). Costs of CHF 1.4 million arose in connection with the repositioning of Systel SAat the Quartino (Switzerland) site.

The concentration on the two sites in Bronschhofen (Switzerland) and Arad (Romania) will help the division cope with price pressure in future. The production facility in Anam in Vietnam was integrated into the division's IT and process landscape so that clients can be offered standardized processes and technologies globally.

Asia Division: dynamic growth

The creation of the Asia Division following the 100% takeover of the ESG Group in March 2010 was Cicor's response to the strategic importance of the rapidly growing Asian markets. The Asia Division’s net sales were up 39.3% at CHF 23.1 million (2009: CHF 16.6 million). Operating profit (EBIT) rose to CHF 1.9 million (2009: CHF 0.6 million).

In the period under review the division renewed and strengthened its management structures and made further progress on the integration of the three production sites in Indonesia, Singapore and Vietnam.

Outlook: profitable growth

In 2011 the Cicor Group intends to take advantage of the continuing trend to outsource production of electronic components and products, as well as to keep developing its growth strategy. Cicor is pursuing a three-part strategy that aims for organic growth, acquisition-driven growth and growth through high-volume projects.
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January 11 2019 8:28 pm V11.10.27-1