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Electronics Production | November 02, 2011

Incap's January-September revenue stood at EUR 52.0 million

January-September revenue for Finland-based Incap stood at EUR 52.0 million, up 21% in comparison to the corresponding period last year (1-9/2010: EUR 43.0 million). Operating result (EBIT) was EUR -1.0 million (EUR -3.2 million) and the operating result for third quarter showed a profit amounting to EUR 0,04 million.
Revenue and earnings in July-September 2011

The third-quarter revenue amounted to EUR 18.3 million, representing an increase of nearly 34% on the corresponding period last year. Demand for electric power technology equipment was particularly strong. After a number of customers informed us of a decline in their demand, the operations of the Helsinki plant were adjusted in accordance with the Cooperation Act.

The third-quarter operating result of EUR 0.04 million was better than those of previous quarters and the corresponding period last year, when it stood at EUR -0.5 million. The availability of materials improved towards the end of the period, but a lack of components caused disruptions to the flow of materials and therefore, deliveries had to be secured by way of overtime. Fluctuations in the exchange rates between the euro, the US dollar and the Indian rupee also weakened the result.

Revenue and earnings in January-September 2011

Demand for Incap's manufacturing services remained positive. Revenue increased by 21% in comparison to the corresponding period in 2010 and stood at EUR 52.0 million (1-9/2010: EUR 43.0 million). The growth in revenue was strongest in the manufacturing of products for the energy efficiency sector. Problems in the availability of certain electronic components continued and slowed down the rate of growth, particularly with regard to well-being technology products.

The profitability of Incap Group increased in comparison to the corresponding period last year, but the operating result for the reporting period nevertheless showed a loss. The operating result for January-September was EUR -1.0 million (EUR -3.2 million), representing -1.9% of revenue (-7.5%).

Profitability improved, and this was particularly due to increased operational efficiency and the centralisation of European electronics manufacturing in a single plant. Performance development was weakened by the focus on material-intensive products within the product mix. A global shortage of components increased the prices of materials and transportation costs to some extent. However, the availability of materials took a clear turn for the better towards the end of the reporting period.

Net financial expenses increased to EUR 1.7 million (EUR 1.2 million). Depreciation stood at EUR 1.6 million (EUR 2.2 million). The loss for the period was EUR -2.7 million (-4.5 million).

Return on investment was -4.2% (-14.7%) and return on equity was -87.5% (-94.6%). Earnings per share were EUR -0.15 (EUR -0.33).

Personnel and management

At the end of the reporting period, Incap Group employed 772 people (798). The average number of personnel was 747 (784). At the end of the reporting period, 22% of the entire personnel worked in Finland (36%), 27% in Estonia (24%) and 51% in India (40%).

Outlook for the rest of 2011

Incap adjusts its guidance for the full-year performance. Operating result (EBIT) for 2011 is expected to show a loss but, nonetheless, to be better than in 2010, when it stood at EUR -3.2 million. The company expects the operating result for the second half of the year to be positive and better than it was for the first half (1-6/2011: EUR -1.0 million) and the corresponding period last year (7-12/2010: EUR -0.5 million). Incap expects its full-year revenue in 2011 to be clearly higher than in 2010, when it amounted to EUR 59.2 million.

In an earlier bulletin released on 20 September 2011, Incap expected the full-year operating result (EBIT) to remain slightly in the red due to fluctuations in exchange rates and the decline in some customers' demand. The company expected the operating result for the second half of the year to be positive or, in other words, clearly better than for the first half of the year (1-6/2011: EUR -1.0 million) and the corresponding period last year (7-12/2010: EUR -0.5 million). In that bulletin, the company stated that it also estimated its full-year revenue for 2011 to be clearly higher than in 2010, when it amounted to EUR 59.2 million.

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July 18 2018 5:55 pm V10.0.0-2