02.05.2016
Softing AG DE0005178008
DGAP-News: Softing AG: Interim Statement
DGAP-News: Softing AG / Key word(s): Quarterly / Interim Statement
Softing AG: Interim Statement
02.05.2016 / 17:50
The issuer is solely responsible for the content of this announcement.
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Dear Shareholders, Employees,
Partners and Friends of Softing AG,
The year has gotten off to a mixed start. While business in Germany and
Europe improved considerably in both segments compared to the year before,
our largest subsidiary in North America experienced declining demand for
industrial automation products in the first quarter as compared to the
excellent previous year. This reflects a clear weakness of demand in North
America, which can also be seen in the IT Networks division, where a large
customer in the American market reported weak sales of our cable tester to
end customers in the first quarter. The sluggish US economy therefore also
affected our Asian subsidiary in Singapore, which produces the cable
tester.
Expressed in figures, the first quarter looks as follows: While revenue
rose to EUR 17.9 million (previous year: EUR 17.3 million), the operating
EBIT fell to EUR 0.8 million (previous year: EUR 1.4 million), which is
considerably lower than the previous year on account of the move towards
less high-margin business. As a result, the operating EPS also decreased to
EUR 0.12 (previous year: EUR 0.21). Softing's orders on hand remained
strong at EUR 9.7 million (previous year: EUR 9.2 million). The Group is
also currently working to full capacity on customer projects.
In the Industrial segment, business in Germany and Europe improved
significantly compared to the previous year. We have also noticed a marked
increase in new projects in connection with Industry 4.0. Although these
projects will not make a substantial contribution to revenue until 2017,
they confirm that our technology is right for the market. An entirely new
technology will have been developed in the USA by the fall, one which none
of our competitors will be able to offer in the foreseeable future.
Furthermore, opportunities are opening up for products in the area of
analytics, which involves deriving statements and guidelines from the
rapidly growing volume of production data. This is currently one of the
hottest topics in our industry.
In the Automotive segment, we will realize a number of extensive product
and project deliveries in the coming weeks. In the second quarter, we will
ship measurement technology products with sales in the seven-digit range
and successfully complete several strategic projects. The third and fourth
quarters will see further extensive shipments of new products for large
automotive customers who urgently need our solutions. Our diagnostics app
is a special strategic highlight here. This app was adapted for our large
customer Audi, and it has been available to Audi and independent workshops
under the brand name of Car Asyst since the end of April. Visit our
professional web shop at www.car-asyst.com for pictures and videos that
explain the concept behind the diagnostics app. We are currently receiving
a tremendous amount of interest in this topic from various manufacturers.
The professional diagnostics app, which is aimed at workshops on a
subscription basis, will start boosting margins in the Automotive segment
in 2017 and help smooth out the course of business through the year.
The unveiling of our new corporate identity and updated logo in March of
this year was well-received all around. Now the outside world can also see
that our segments are off to a fresh start with shorter names: Industrial,
Automotive and IT Networks. Countless web pages and catalogs were updated
to clearly reflect that the companies are part of the Softing Group. The
final step in this initiative will be taken this summer when Psiber Data is
incorporated into the Group by name as well. In the IT Networks segment,
the expansion of business in France and Italy is already bearing fruit.
Demand has also improved noticeably in the USA since April. We therefore
remain confident about the year as a whole. The weaknesses in the first
quarter will strengthen the seasonality which will basically reflect the
course of 2015 this year as well. We expect the second quarter to be
stronger than the first. Based on known customer receivables and
requirements, it is already clear that the most revenue in 2016 will again
be generated in the third and fourth quarters. We therefore confirm our
previous forecast.
Dear shareholders and friends of Softing, our whole team is absolutely
committed to making this year a success. We hope that you remain loyal to
us in the future and continue to profit from Softing's development!
Sincerely Yours,
Wolfgang Trier
Q1 2016 Statement
The quarterly management statement as of March 31, 2016, which was prepared
on the basis of International Accounting Standard (IAS) 34 "Interim
Financial Reporting", does not contain all of the required information in
accordance with the requirements for the presentation of the annual report
and should be read in conjunction with the consolidated financial
statements of Softing AG as of December 31, 2015 (which were prepared in
accordance with the International Financial Reporting Standards (IFRSs) of
the International Accounting Standards Board (IASB) applicable as of the
reporting date). In general, the same accounting policies were applied in
the quarterly management statement as of March 31, 2016 as in the
consolidated financial statements for the 2015 financial year. As of the
reporting date of March 31, 2016, the Company's risk structure had not
deviated significantly from the description in the consolidated financial
statements for the year ended December 31, 2015. Material changes are also
not expected for the remaining nine months of 2016. For more detailed
information, we refer to our Group Management Report in the 2015 Annual
Report, page 9 et seq. There were no changes in the basis of consolidation
of Softing AG as of March 31, 2016.
In the first three months, the Industrial segment's growth trajectory in
Europe was strong, but performance in the United States and Asia was weaker
year on year. Compared with the prior-year period, growth in the Automotive
segment was very good, and performance going forward looks positive as
well.
Key Figures of the Softing Group at a Glance:
All figures in EUR million Quarterly report Quarterly report 1/2016 1/2015 Orders on hand 9.7 9.2 Revenue 17.9 17.3 EBITDA 1.9 2.4 EBIT (operating) 0.8 1.4 Net profit for the year 0.4 0.7 Earnings per share in EUR (operating) 0.12 0.21Results of Operations In the Automotive Electronics segment, revenue rose by 21% in the first three months of 2016 to EUR 5.3 million (previous year: EUR 4.4 million), while the Industrial Automation segment saw revenue of EUR 12.6 million, slightly underperforming last year (previous year: EUR 12.9 million).EBIT (operating) in the Automotive segment was up from EUR -0.1 million to EUR 0.5 million. In the Industrial segment, EBIT (operating) declined from EUR 1.5 million to EUR 0.3 million. Despite the weakness of the US market, the total revenue of the Softing Group amounted to EUR 17.9 million in the first three months of 2016, increasing EUR 0.6 million year on year (previous year: EUR 17.3 million). Operating EBIT (EBIT adjusted for capitalized development services and amortization on these as well as effects from purchase price allocation) in the reporting period totaled EUR 0.8 million (previous year: EUR 1.4 million). The decline is largely due to the lower gross profit generated on the US market. EBIT amounted to EUR 0.7 million (previous year: EUR 1.2 million). EBITDA was EUR 1.9 million in the first three months (previous year: EUR 2.4 million), and the EBITDA margin was 11% (previous year: 14%). Net Assets and Financial Position The equity ratio as of March 31, 2016 was 54% (December 31, 2015: 51%); the share capital of Softing AG remained unchanged at EUR 6,959,438. As of March 31, 2016, cash and cash equivalents amounted to EUR 8.9 million (December 31, 2015: EUR 9.2 million). Capital expenditure on property, plant, and equipment was insignificant and comprised only replacements. Research and Product Development In the first three months of 2016, Softing capitalized a total of EUR 0.8 million (previous year: EUR 0.7 million) for the development of new products and the enhancement of existing ones. Other significant amounts were expensed. Employees As of March 31, 2016, the Softing Group had 426 employees (previous year: 427). During the reporting period, no stock options were issued to employees. Outlook For 2016 as a whole, Softing estimates that the European Group companies in the Industrial and Automotive segments will see a moderate increase in revenue, motivated for now by the behavior of individual customers rather than the economy. From the third quarter of 2016 onward, we expect the trend in the US Group companies to turn around due to the launch of new products and delivery times, although the second quarter of 2016 may still reflect weakness in the market. Softing also expects the market situation in Asia to improve in the third quarter of 2016. Softing confirms the guidance issued in the outlook for financial year 2016 projecting a moderate increase in revenue to over EUR 85 million and an increase in operating EBIT to EUR 7.5 million. --------------------------------------------------------------------------- 02.05.2016 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG. The issuer is solely responsible for the content of this announcement. The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de --------------------------------------------------------------------------- Language: English Company: Softing AG Richard-Reitzner-Allee 6 85540 Haar Germany Phone: +49 (0)89 456 56-333 Fax: +49 (0)89 456 56-399 E-mail: [email protected] Internet: www.softing.com ISIN: DE0005178008 WKN: 517800 Listed: Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Munich, Stuttgart End of News DGAP News Service --------------------------------------------------------------------------- 459979 02.05.2016
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