Strong end to the year
Fourth quarter
• Operating income was SEK 583 million (539) and organic growth was 13%
• The operating profit was SEK 35 million (-91), giving an operating margin of 6.0% (-16.9)
• The profit after tax was SEK 23 million (-90)
• Earnings per share (EPS) was SEK 1.26 (-4.97)
January-December
• Operating income was SEK 2,091 million (2,281)
• The operating profit was SEK 3 million (-241), giving an operating margin of 0.1% (-10.6)
• The loss after tax was SEK 5 million (-209)
• EPS was SEK -0.29 (-11.52)
• The equity/assets ratio was 33.0% (30.5)
CEO’s comment
“We’ve seen a clear improvement in the market situation in the second half of the year and in Q4 we once again reported growth and a good profit. New business and more inquiries from all industries mean we now need to recruit. The outlook for 2011 is positive and we’re expecting continued profit improvement.”
Kjell Nilsson, CEO
Fourth quarter
Operating income rose by SEK 44 million to SEK 583 million (539) and organic growth was 13% following adjustments for currency effects.The operating loss improved by SEK 126 million and amounted to SEK 35 million (-91), giving an operating margin of 6.0% (-16.9). All business areas are reporting growth and improved profits for the quarter. The results for the period have been burdened by SEK 4 million for carrying out the previously decided cost-cutting scheme. Results for the same period last year were affected by one-off items of SEK 101 million, of which write-down of goodwill and shares in associated companies amounted to SEK 78 million. Excluding these items the operating profit was SEK 39 million (10) with an operating margin of 6.7% (1.9). Net financial items amounted to SEK -2 million (-5), giving a profit before tax of SEK 33 million (-96). The profit after tax was SEK 23 million (-90) and the EPS was SEK 1.26 (-4.97).
January-December
Operating income was SEK 2,091 million (2,281) and organic growth was -5%. The fall in sales is due to a poor start during the first six months of the year, mainly for the units active in the automotive sector. The operating profit was SEK 3 million (-241), giving an operating margin of 0.1% (-10.6). The total cost of carrying out the cost-cutting scheme affected results by SEK 15 million. Last year results were affected by one-off items of SEK 171 million. The operating profit, excluding these one-off items was SEK 18 million (-70) with an operating margin of 0.9% (-3.1).Net financial items amounted to SEK -9 million (-16). The loss before tax was SEK 6 million (-257). The loss after tax was SEK 5 million (-209) and the EPS was SEK -0.29 (-11.52).
Financial position
The operating cash flow from current activities was SEK -36 million (107). The Group’s cash and bank balances amounted to SEK 42 million (68) with additional non-utilized credit of SEK 100 million (100) and a revolving credit facility of EUR 32.8 million (42.8) to run until July 2011 with an option available for the company, before the due date, to extend the revolving credit to a three-year loan. Investment in hardware, licenses, office supplies and equipment, amounted to SEK 14 million (19). Shareholders’ equity amounted to SEK 373 million and the equity/assets ratio was 33.0% (30.5). The Group’s net debt was SEK 305 million (316) and the debt/equity ratio was 0.8 times (0.8).
Events during Q4
• Semcon received an order for upgrading the ComTest® measuring system at nuclear power plant Forsmark 1 and 2. The system is used for monitoring the condition of drive gear, isolation valves and flow valves.
• Semcon has been appointed as a preferred supplier for technical engineering services by Vattenfall between 2011-2013 with the option of one extra year. The contract is for nuclear power, wind power and hydroelectric power services to be carried out by specialists from all Semcon’s business areas.
Staff and organization
The headcount on 31 December was 2,703 (2,631) of which 1,432 (1,523) are in Sweden and 1,271 (1,108) abroad. The number of employees actively employed was 2,558 (2,467). The average number of employees was 2,474 (2,791). The number of employees in the respective business areas was: Automotive R&D 1,565 (1,497), Design & Development 753 (784) and Informatic 385 (350).
Outlook
Products, plants and systems are becoming increasingly complex, requiring extensive development and documentation. Meanwhile demands are being placed on more rapid development processes and to cut development costs through more effective working practices. In all, this means improved business opportunities for the Group. We have seen a clear improvement in the market situation in the second half of 2010. New business and more enquiries from all our industries mean that we have a major need to recruit on all markets. Our outlook for 2011 is positive and we expect to continue seeing profit improvements.
Semcon is a global company active in the areas of engineering services and product information. The Group has around 2,700 employees with extensive experience from many different industries. We develop technologies, products, plants and information solutions along the entire development chain and also provide many services including quality control, training and methodology development. Semcon boosts customers’ sales and competitive strength by providing them with innovative solutions, design and solid engineering solutions. The Group has sales of SEK 2.1 billion and activities at more than 40 sites in Sweden, Germany, the UK, Brazil, Hungary, India, China, Spain and Russia
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