SCANFIL PLC INTERIM REPORT 27 OCTBER 2017 8.00 A.M.
SCANFIL GROUP’S INTERIM REPORT 1 JANUARY – 30 SEPTEMBER 2017
July-September 2017: Strong operating margin benefitted from increased sales and lighter cost structure
July – September 2017
– Turnover totalled to EUR 130.8 million (Q3 2016: 121.7)
– Operating profit EUR 8.5 million (7.6, before adjustments 7.7), 6.5% of turnover (6.2%, before
adjustments 6.3%)
– Profit was EUR 5.2 million (6.5)
– Earnings per share amounted EUR 0.08 (0.10, before adjustments 0,11)
January – September 2017
– Turnover totalled to EUR 385.5 million (1-9 2016: 385.7)
– Operating profit EUR 21.7 million (4.4, before adjustments 17.6), 5.6% of turnover (1.1%, before
adjustments 4.6%)
– Profit for the review period was EUR 15.3 million (-1.2)
– Earnings per share were EUR 0.24 (-0.02, before adjustments 0.19)
The interim report does not include any adjustments to report. Adjustments for the year 2016 include the costs of the reorganisation, sale and closure of poorly profitable units of PartnerTech AB’s plant network and the Metal Precision business acquired in the year 2015.
Future outlook
Scanfil estimates, that its turnover for 2017 will be EUR 500–530 million and the operating profit will amount to EUR 28 – 31 million.
| KEY FIGURES | |||||||
| Q3/2017 | Q3/2016 | Change% | Q1-Q3/2017 | Q1-Q3/2016 | Change% | 1-12.2016 | |
| Turnover, EUR million | 130.8 | 121.7 | 7% | 385.5 | 385.7 | 0% | 508.0 |
| Operating Profit, EUR million | 8.5 | 7.6 | 12% | 21.7 | 4.4 | 393% | 7.2 |
| Operating Profit, Adjusted, EUR million | 8.5 | 7.7 | 10% | 21.7 | 17.6 | 23% | 22.3 |
| Operating Profit, % | 6.5 | 6.2 | 5.6 | 1.1 | 1.4 | ||
| Operating Profit, %, Adjusted | 6.5 | 6.3 | 5.6 | 4.6 | 4.4 | ||
| Net Profit, EUR million | 5.2 | 6.5 | -21% | 15.3 | -1.2 | 1380% | 0.1 |
| Net Profit, Adjusted, EUR million | 5.2 | 6.7 | -23% | 15.3 | 12.5 | 23% | 15.7 |
| Earnings per Share, EUR | 0.08 | 0.10 | -20% | 0.24 | -0.02 | 1300% | 0.00 |
| Return on Equity, % | 18.3 | -1.6 | 0.1 | ||||
| Equity Ratio, % | 37.9 | 37.2 | 40.7 | ||||
| Net Gearing, % | 44.9 | 49.3 | 36.9 | ||||
| Net Cash Flow from Operations, EUR million | 7.3 | 3.1 | 135% | 16.5 | |||
| Employees (Average) | 3 212 | 3 534 | -9% | 3 483 | |||
Petteri Jokitalo, CEO of Scanfil plc:
“I am very happy about the achieved sales growth as well as the positive development of profitability during the third quarter. Compared to previous year we grew 7% and reached 6.5% operating profit which exceeded our this year’s targeted 6%. Return on equity was 18.3%.
We have been able to increase our operating profit every quarter of the year significantly. This has been possible due to positively developed customer demand and particularly strong growth in new customer sales. The benefits from the optimization of the factory network can be seen, even though it is clear that we still need to improve our operational performance, especially in Myslowice, Poland and Sievi, Finland. I am especially proud of the contribution of Scanfil’s employees. The result achieved would not have been possible without the hard work of the employees and their commitment to the set goals.
Our investment in manufacturing capacity and facilities has been at a record level throughout the year. In August, we moved to a larger production facility in Atlanta, and the Sieradz electronics factory is completing an expansion investment that doubles the factory’s floor space and capacity. New electronics manufacturing lines have been acquired and deployed at the Suzhou, Sieradz and Malmö plants. The production capacity of the Myslowice factory’s sheet metal manufacturing has tripled. With these investments, we have upgraded and increased our manufacturing capacity to meet the foreseen customer demands. These investments also enable us to meet the future growth targets.
I am pleased with Scanfil’s financial development in the third quarter. I am confident that the positive development will continue for the rest of the year and we will achieve the goals set for this year.”
Financial Development
The Group’s turnover for January – September was EUR 385.5 (385.7) million. The Group’s operating profit for January – September was EUR 21.7 (4.4) million, representing 5.6% (1.1%) of turnover. The operating profit for the previous year includes adjustments total of EUR 13.2 million, consisting of the costs of the reorganisation, sale and closure of poorly profitable units of PartnerTech AB’s plant network and the Metal Precision business acquired in the year 2015. Operating profit grew 23.3% compared to the adjusted operating profit of the corresponding period of the previous year. Operating profit without adjustments in January – September 2016 was EUR 17.6 million, 4.6% of turnover.
The net profit for the review period was EUR 15.3 (-1.2) million. The net profit for the comparison period without adjustments was EUR 12.5 million.
Earnings per share for the review period were EUR 0.24 (-0.02). In the previous year, the earnings per share without adjustments were EUR 0.19. Return on investment was 16.4 (4.2)%.
The Group’s turnover for July–September amounted to EUR 130.8 (121.7) million, with the increase of 7.4% compared to the corresponding period of previous year. Operating profit was EUR 8.5 (7.6) million, or 6.5% (6.2%) of turnover. Operating profit grew 12.5% compared to the corresponding quarter of the previous year. The previous year’s third quarter included EUR 0.1 million adjustment items.
The net profit of third quarter includes 0.8 million EUR incremental taxes due to tax audit carried out in the Polish subsidiary and dividends paid from China subsidiaries. Incremental taxes from Polish subsidiary (EUR 0.4 million) are related to the transfer pricing between the Group companies in 2014, and the Group is considering reclaiming the taxes in EU arbitration.
Publication of financial releases
This stock exchange release is a summary of the Scanfil Group’s interim report 1 January – 30 September 2017 and includes the most relevant information of the report. The complete report is attached to this release as a pdf file and is also available on the company’s website at www.scanfil.com.
SCANFIL PLC
Petteri Jokitalo
CEO
Additional information:
CEO Petteri Jokitalo
Tel +358 8 4882 111
Distribution NASDAQ OMX, Helsinki
Major Media
www.scanfil.com
Scanfil is an international contract manufacturer and system supplier for the electronics industry with 40 years of experience in demanding contract manufacturing. Scanfil provides its customers with an extensive array of services, ranging from product design to product manufacturing, material procurement and logistics solutions. Vertically integrated production and a comprehensive supply chain are the foundation of Scanfil’s competitive advantages: speed, flexibility and reliability.
Typical Scanfil products include mobile and communications network devices, automation system modules, frequency converters, lift control systems, analysers, various slot and vending machines, and devices related to medical technology and meteorology. Scanfil services are used by numerous international automation, energy, IT and health service providers, as well as companies operating in the field of urbanisation. Scanfil’s network of factories consists of 10 production units in Europe, Asia and North America. The total number of employees is 3,200.
Not to be published or distributed, directly or indirectly, in any country where its distribution or publication is unlawful. Forward looking statements: certain statements in this stock exchange release may constitute “forward-looking” statements which involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements of Scanfil Oyj to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. When used in this stock exchange release, such statements use such words as “may,” “will,” “expect,” “anticipate,” “project,” “believe,” “plan” and other similar terminology. New risk factors may arise from time to time and it is not possible for management to predict all of those risk factors or the extent to which any factor or combination of factors may cause actual results, performance and achievements of Scanfil Oyj to be materially different from those contained in forward-looking statements. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results. The forward-looking information contained in this stock exchange release is current only as of the date of this stock exchange release. There should not be an expectation that such information will in all circumstances be updated, supplemented or revised, except as provided by the law or obligatory regulations, whether as a result of new information, changing circumstances, future events or otherwise.