Electronics Production | June 20, 2006
Lower prices on telecom equipment hurt Scanfil
According to preliminary information Finland based EMS-provider Scanfil's turnover on 1 January - 30 June is estimated to be lower than earlier expected.
Scanfil plc announced in a stock exchange release published on 10 April 2006 that the turnover of the 1st half of the year 2006 is estimated to fall by about 20% compared to the corresponding period last year. According to preliminary information Scanfil plc's turnover on 1 January - 30 June is estimated to be about EUR 120 (161,4) million and operating profit about 7% without EUR 7,6 million non-recurring items related to the discontinuation of the Belgian subsidiary's production activities. The turnover of the 2nd half of the year 2006 is estimated to be higher than in the 1st half but clearly lower than during the corresponding period in year 2005. The turnover is supposed to decrease slightly more than expected, mainly as a result of a decline in the average prices of wireless telecommunications products that is faster than the growth of production volumes. Prices have been affected not just by the price competition but also by the product and supply structures with lower production costs of new, technically more advanced products and by production in lower-cost countries. Profitability for the full year is expected to develop as estimated in the interim report of 28 April 2006. Scanfil will publish its interim report for 1 January - 30 June 2006 on 3 August 2006.