Scanfil reports solid operational performance and prepares for growth
"In the second quarter of 2024, Scanfil continued demonstrating resilience to market fluctuations and its ability to deliver the targeted operating profit margin of 7%-8%," says Scanfil CEO Christophe Sut.
During the second quarter of 2024, Scanfil recorded a turnover of EUR 195.5 million, a decrease of 19.7% from EUR 243.3 million during the same period last year. Operating profit was EUR 13.9 million, compared to EUR 17.5 million – a decrease of 20.6%. Net profit was EUR 10.8 million, down 25.4% from EUR 14.5 million during the comparison period.
CEO Christophe Sut says in the half-year report that the efficiency improvement project initiated in Q4 2023 helped Scanfil to deliver profit margins in line with the company's long-term target despite weaker market conditions
"In Q2 2024, profit margin landed at 7.1%, one of the best quarterly profit margins ever for Scanfil. The margin improvement was driven by the focus of the whole team worldwide to improve operational efficiency, which also contributed to our strong on-time delivery rate of >98%."
The CEO continues to say that the industrial segment was negatively impacted by end customer demand changes and customer destocking.
"We continue to work closely with our customers to adjust operations and inventory to the prevailing market situation. We are now implementing newly won projects for global customers with an annualised value of EUR 9 million in Q2 and EUR 34 million in H1 2024."
The Energy & Cleantech segment declined during the quarter as the company faced strong comparable numbers driven by the component shortage a year ago. In addition, several customers are destocking this year. However, the long-term development of the Energy & Cleantech segment remains positive, and the company has seen a record number of projects won in Q2 with an annualised value of EUR 23 million and EUR 38 million in H1 2024.
Christophe Sut says that the Medtech & Life Science segment has stabilised and shows signs of rebounding. Scanfil won new contracts with existing and new customers for an annualised value of EUR 8 million in Q2 and EUR 13 million in H1 2024.
"We continue to work on implementing our strategy. The sales organisation has now started to function based on our new model with three different teams focusing on the Industrial, Energy & Cleantech and Medtech & Life Science segments. We also continue to implement and tune our investment plan. As we continue to invest in machine capabilities for our Sieradz factory’s expansion, we have now adjusted the delivery of the new building to Q3 2026."
Christophe Sut says that overall, market conditions remain volatile, and the company see customers still having difficulty predicting their short-term demand.
"However, we have demonstrated our capability to manage uncertainty and protect profitability in times of lower demand. We are also prepared to increase our production when demand recovers. We will continue to work on protecting our profit margin and prepare for future growth. We expect the market to pick up gradually, starting with the Medtech & Life Science segment."
For the full year of 2024, Scanfil estimates its turnover to be EUR 780–840, and an adjusted operating profit of EUR 54–61 (57–65) million.
