© Neways Electronics Electronics Production | October 29, 2020
Neways sees slight recovery in turnover during 3Q
During the company’s third quarter, net turnover fell 8.9% YoY, largely due to a sharp decline in Automotive. Industrial saw a slight decline in turnover while Medical remained stable. Semiconductor however saw a rise in turnover.
Comparing the third quarter to the previous one, net turnover increased 4.7%, driven by a recovery in demand in Automotive, primarily in e-Mobility, the company says in a press release Order intake for the EMS provider fell by 17.8% year-on-year. The order book stood at EUR 221 million at end-September, compared with EUR 291 million at year-end 2019. This decline was due to a drop in demand, largely from Automotive and to a lesser extent from Industrial. Order intake from Medical and Semiconductor remained stable or was slightly higher. Order intake was 5.4% higher than in the second quarter, which points to a cautious recovery in demand from Automotive clients. However, Neways says that due to continued pandemic-related uncertainty, the company expects the market to remain volatile in the fourth quarter. In this context Neways will make a number of structural adjustments at certain operating companies to bring the organisation and capacity utilisation more in line with the current environment. “In the third quarter, we saw a cautious recovery in the Automotive sector, primarily in e-Mobility. However, the decline in demand due to the pandemic and the lockdowns was so large in this industry that we will not be able to make up the decline this year. In these exceptional circumstances, we have acted as effectively as possible by continuously ensuring a safe working environment for our employees, by adjusting the organisation and capacity utilisation at certain operating companies where necessary and by continuing to reduce our cost base,” says CEO Eric Stodel, in the press release. “For the remainder of this year, we are assuming market volatility to remain high, driven by pandemic-related uncertainty. We will continue to focus on profitable turnover, cost controls and cash flow. At the same time, we will continue to implement our internal improvement programme One Neways, and will make additional adjustments to accelerate this transformation process and increase the effectiveness of our organisation,” the CEO concludes.