Bulten’s Q2 report 2019

2019-07-10Press release

Inventory adaptation and lower production rate affected results negatively.

SECOND QUARTER  

  • Net sales amounted to SEK 781 (810) million, a decrease of -3.5% on the same period last year.
  • Operating earnings (EBIT) totaled SEK 21 (57) million, equating to an operating margin of 2.7% (7.1).
  • Operating earnings (EBIT) adjusted for relocation costs in China totaled SEK 27 (57) million, equating to an adjusted operating margin of 3.4% (7.1).
  • Earnings after tax amounted to SEK 14 (40) million.
  • Order bookings totaled SEK 752 (855) million, a decrease of -12.0% on the same period last year.
  • Cash flow from operating activities totaled SEK 52 (54) million.
  • Earnings per share were SEK 0.71 (1.99)

JANUARY – JUNE

  • Net sales amounted to SEK 1,591 (1,663) million, a decrease of -4.3% on the same period last year.
  • Operating earnings (EBIT) totaled SEK 79 (124) million, equating to an operating margin of 4.9% (7.4).
  • Operating earnings (EBIT) adjusted for relocation costs in China totaled SEK 86 (124) million, equating to an adjusted operating margin of 5.4% (7.4).
  • Earnings after tax amounted to SEK 58 (88) million.
  • Order bookings totaled SEK 1,485 (1,634) million, a decrease of -9.1% on the same period last year.
  • Cash flow from operating activities totaled SEK -5 (80) million.
  • Earnings per share were SEK 2.83 (4.42).
  • Net debt amounted to SEK 595 (118) million. Net debt (excluding financial leasing) totaled SEK 347 (80) million.
  • The equity/assets ratio was 54.8% (66.0) at the end of the period. The equity/assets ratio (excluding financial leasing) totaled SEK 59.4% (66.0).

SIGNIFICANT EVENTS AFTER THE END OF THE REPORTING PERIOD

  • Bulten have announced that earnings for the second quarter was negatively affected by approximately SEK 25 million due to a lower production rate in order to adjust the stock level.

CEO’S COMMENTS

“The second quarter saw a continuation of the decline on the car market which began in the second half of 2018, and the market situation is reflected in Bulten’s lower volumes. Net sales decreased by -3.5%. Earnings was affected negatively by a lower rate of production in order to balance inventory levels to demand, but also due to lower sales, primarily toward the end of the quarter. The lower production rate has brought the reduction in inventories according to plan, but also resulted in a lower utilization of the production units’ capacity and thus under-absorption of fixed costs. The ambition of adapting inventory levels was previously communicated in connection with the Q1 report. The under-absorption had a negative impact on earnings of approximately SEK 25 million during the second quarter.

We are not satisfied with the development during the quarter, but the adjustment of production rate was necessary in the prevailing market climate. At present, demand remains lower than last year, and volumes related to new contracts have ramped up more slowly than anticipated. With this in mind, the production rate will remain lower at the start of Q3. A review of the company’s costs has been initiated for adaptation to the current market situation.

As previously announced, Bulten has contracts in place worth just over half a billion SEK a year at full production in 2021. During the first half-year, we have also won several smaller contracts with a total annual value of approximately SEK 20 million, in addition to the previously already announced of approximately SEK 130 million.”

Anders Nyström, President and CEO

Investors, analysts and media are invited to participate in the teleconference on July 10 at 11:00 CET. The report will be presented by Anders Nyström, President and CEO and Helena Wennerström, Executive Vice President and CFO via audiocast.

The presentation will be held in English and can be followed live via the link: https://tv.streamfabriken.com/bulten-q2-2019. It will also be possible to take part of the audiocast afterwards at the same address or at www.bulten.com/ir.

To participate in the teleconference, please call 5 minutes before the opening:

SE: +46856642695
UK: +443333009262
US: +18335268347

For further information, please contact:

Anders Nyström, President and CEO
Tel: + 46 31-734 59 00

Kamilla Oresvärd, Senior Vice President Corporate Communications
Tel: +46 70-520 59 17, e-mail: kamilla.oresvard@bulten.com

This information is information that Bulten AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out above, at 08:30 CET on July 10, 2019.

Bulten is one of the leading suppliers of fasteners to the international automotive industry. The company’s product range includes everything from customer-specific standard products to customized special fasteners. The company also provides technical development, line-feeding, logistics, material and production expertise. Bulten offers a Full Service Provider concept or parts thereof. The company was founded in 1873, has some 1,400 employees in eight countries and head office in Gothenburg. The share (BULTEN) is listed on Nasdaq Stockholm. Read more at www.bulten.com.

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