© Hanza Electronics Production | April 27, 2020
COVID-19 hits Hanza in waves – 90 jobs lost
Swedish manufacturing strategist, Hanza, describes how the COVID-19 outbreak has negatively affected operations in the period and further expects that both the economy and the demand will continue to weaken during 2020.
In April Hanza initiated an action program which among other things include redundancies in Sweden and Estonia for about 90 people. At the same time the company notes that the pandemic creates an increased need for revised supply chains which is Hanza’s “bread and butter” – offering complete and regional manufacturing close to the customer. ”During the quarter, covid-19 has negatively impacted HANZA in waves. First through the closure of our factory in China and some component shortages in Europe. Then, by the extensive spread of infection in the rest of the world, which resulted in a rapid slowdown of the economy and reduced demand in certain customer segments,” says CEO Erik Stenfors in a press release. During the first quarter of 2020, Hanza’s net sales amounted to SEK 599.1 million (EUR 55.8 million), up from SEK 497.7 million (EUR 45.8 million) during the same period last year. EBITA amounted to SEK 20.4 million (EUR 1.87 million), up from SEK 19.5 million (EUR 1.79 million) for the first quarter 2019. EBIT amounted to SEK 16.8 million (EUR 1.54 million), compared to SEK 17.3 million (EUR 1.59 million). Profit after tax amounted to SEK 6.4 million (EUR 589’000), down from SEK 9.1 million (EUR 838’000) during the same period last year. “We expect there will be further volume reductions in quarter two. Hence, we launched an action program in April, aimed at reducing our fixed costs without having to limit our unique offering with complete manufacturing. Among other things, we are streamlining HANZA's production facilities to embrace only specific technologies within the respective production clusters, which regrettably results in redundancies in Sweden and Estonia of approx. 90 people.” The CEO continues to explain that one effect of the pandemic is that weaknesses and risks in global supply chains have become apparent, and thereby increased the need to streamline the manufacturing industry. “That is, an increased need that is in line with HANZA's offering of complete regional manufacturing close to the customer. Therefore, the pandemic creates new opportunities for HANZA in the long term,” Stenfors concludes.