© Kitron Electronics Production | April 30, 2019
Kitron reports strong growth and earnings improvement for 1Q19
EMS provider Kitron says that the company recorded very strong growth as well as earnings improvement in the first quarter. Revenue, order backlog and operating profit all reached record levels.
Kitron's revenue for the first quarter was NOK 813 million (EUR 84.05 million), an increase of 25% compared to last year. Organic growth, excluding the acquisition of the EMS division of API Technologies Corp., was 20%. The order backlog ended at NOK 1 466 million (EUR 151.53 million), an increase of 43% compared to last year. Organic order backlog growth, excluding the API acquisition, was 28%. Profitability expressed as EBIT margin was 6.3% in the first quarter, up from 6.0% in the same quarter last year. "The record performance in the first quarter demonstrated our ability to successfully combine organic growth and M&A with operational and earnings improvements. In 2019 we will significantly increase our capacity in the US and Poland. On the demand side, the anticipated upturn among customers in the oil and gas industry is gathering momentum and boosting growth. All these factors strengthen our confidence in the new strategic ambitions that we outlined at our capital markets day in March,” says Cathrin Nylander, Kitron's CFO and acting CEO, in a press release. Kitron's revenue in the first quarter amounted to NOK 813 million (EUR 84.05 million), compared to 651 million (EUR 67.29 million) in the same quarter last year. All market sectors grew significantly. In absolute numbers, first quarter revenue growth compared to the same quarter last year was particularly strong in the Industry market sector. Percentage-wise, Offshore/Marine grew the most. First quarter operating profit (EBIT) was NOK 51.2 million (EUR 5.29 million), compared to 38.8 million (EUR 4.01 million) last year. EBITDA was NOK 68.6 million (EUR 7.09 million), compared to 53.0 million (EUR 5.47 million) last year. Profit after tax amounted to NOK 37.5 million (EUR 3.87 million), compared to 26.2 million (EUR 2.70) in the first quarter the previous year. Component shortages have been an ongoing issue for the EMS industry over the past quarters. The situation is expected to be less challenging throughout 2019 and Kitron expects that a gradual improvement over the year will lead to a reduction of working capital, both in absolute numbers and as a percentage of revenue. In the first quarter, Kitron completed the acquisition of the EMS division of API Technologies Corp., substantially strengthening its position in the US market. Kitron consolidated the acquired business effective 15 February.