Renewed growth expected for LPKF in 2015 following revision of 2014 forecast
Specialist mechanical engineering company LPKF Laser & Electronics AG announced revenue of €80 million (previous year: €99.5 million) for the first nine months of the current financial year. Earnings before interest and taxes (EBIT) after nine months were €7.6 million. This corresponds to an EBIT margin of 10 per cent as of 30 September. Positive signs are evident in terms of incoming orders and orders in hand, which were up significantly year-on-year, at 17 and 96 percent, respectively.
After having experienced average annual growth of 23 percent over the past five years, in October 2014 the TecDAX company had to adjust its annual profit forecast downwards for the first time in six years and prepare its investors for lower revenue and earnings in 2014. The key reasons for the revision were a recent decline in incoming orders and the postponement of a major project in the Laser Direct Structuring (LDS) business. LPKF believes that the customer restraint is mainly attributable to faltering global growth and the resulting uncertainty in the electronics industry.
Based on the new forecast, LPKF now anticipates revenue in the range of €120 million to €125 million (previously: €132 million to €140 million) and an EBIT margin of 10 to 12 percent (previously: 15 to 17 percent) for 2014.
While CEO Dr. Ingo Bretthauer is not satisfied with business performance in the current year, he sees no reason for serious concern, “Our growth drivers in the markets are intact, company financing is solid and profitability remains above-average, despite the revenue downturn,” said Bretthauer. “We are developing exciting new products and methods and want to return to our path of growth next year.”
The management board expects renewed growth in the 2015 financial year. Revenue in 2015 is estimated at €128 million to €136 million while the EBIT margin is estimated at 12 to 15 percent and should therefore once again converge on the intended range of 15 to 17 percent. In the following years, LPKF continues to expect revenue growth at an annual average of at least 10 per cent, accompanied by an EBIT margin of 15 to 17 percent. This forecast is conditional on a stable economic environment.