DGAP-News: Funkwerk AG: Funkwerk sets course for profitable growth
(firmenpresse) - DGAP-News: Funkwerk AG / Key word(s): Final Results
Funkwerk AG: Funkwerk sets course for profitable growth
31.03.2011 / 08:01
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PRESS RELEASE
Funkwerk sets course for profitable growth
- Marginally positive operating result before impairment and
restructuring costs, with sales of EUR 211m (2009: EUR 218.4m)
- Cost savings of EUR 19m, adjustment of business model initiated
- Sales to grow in 2011 generating profit again
Kölleda/Frankfurt, 31 March 2011. Funkwerk AG (ISIN DE0005753149) hopes to
achieve significant growth in sales and earnings again by 2013. Revenues of
the Thuringian communication systems specialist are to rise as early as in
the current financial year to generate considerable profit again, as the
Executive Board announced today at the press conference on the company's
financial statements. The restructuring programme completed in 2010 led to
cost savings of EUR 19m. 'With the measures implemented and initiated, our
company has taken an important step forward and is now back on firm ground.
Based on our current planning, Funkwerk will achieve profitable growth
again in 2011. This trend should improve further still in 2012 and 2013
with increasing profit margins,' the Executive Board said in its forecast.
Funkwerk had to cope with a triple endurance test in 2009 and 2010. Along
with the negative trend of the global economy, the group needed to be put
on a new, more efficient platform and undergo a strategic change from
equipment provider in a special niche towards a supplier of professional
solutions for specific sectors of the industry. To this end, the product
portfolio was reduced to essential key components with greater
technological value added and a platform strategy developed which enables a
better trans-sectoral use of resources. In 2011, the company will continue
to push ahead with the optimisation of its business model and its
internationalisation through cooperation with international infrastructure
manufacturers.
Operational turnaround with reduced sales
'This has effectively increased our profitability and helped us achieve an
operational turnaround in 2010,' the Executive Board said summarising the
success of these measures. Through cost savings of around EUR 19m, the
operating result (before impairment and restructuring costs) was brought
back into the black (EUR +0.6m, 2009: EUR -14.1m), while sales year on year
once again fell by a slight margin to EUR 211m (2009: EUR 218.4m) due to
various factors. Without the deconsolidation effect of around EUR 7m from
the closure of a subsidiary in France and the loss of around EUR 13m due to
the politically induced stoppage of business activities in Algeria,
Funkwerk could have even achieved a slight gain. In addition, Funkwerk had
deliberately given up several product groups and, with it, sales
contributions as part of its restructuring measures.
On the whole, the trend in the four business segments of Funkwerk lagged
behind the general economy. This is due, on the one hand, to the fact that
Funkwerk primarily provides information and communication systems as
infrastructure for transport operators, companies and public institutions.
Economic activity in these sectors follows the general economic trend, but
with a certain time lag. On the other, the restrictive fiscal policies in
Europe as a result of the Euro crisis curbed the propensity to invest in
infrastructure projects.
Sales and earnings in 2010 were affected particularly negatively by
political events in Algeria, which - as already reported ad hoc - led
Funkwerk to an extraordinary writedown of almost its entire commitment in
the country in order to exclude further balance sheet risks for 2011.
Consequently, the company accounted for impairments of EUR 9.1m for project
business in Algeria as early as in the 2010 financial statements.
Due to all but completing its capacity adjustments in 2010, the pertinent
expenditure reduced from EUR 8.9m in 2009 to EUR 2.2m. At EUR -3.4m, the
revaluation of intangible assets required as a result of the decline in
sales and the discontinuation of product ranges also proved significantly
less in the reporting period than in the previous year (EUR -19.8m). On the
whole, this produced a negative operating result of EUR -12.8m in 2010
(2009: EUR -42.8m). Due to a negative financial result and an earnings tax
burden of EUR 7.6m, the consolidated annual net loss therefore totalled EUR
-24.9m (2009: EUR -40.8m). This corresponds to earnings per share of EUR
-3.09 (2009: EUR -5.06).
As the working capital had again dropped quite considerably, Funkwerk was
able all the same to achieve a positive operating cash flow of EUR 4.4.m
for 2010 (2009: EUR 7.2m). On the whole, Funkwerk had a net liquidity of
EUR 11.6m on 31 December 2010 (2009: EUR 19.8m).
Effectively back to profit from 2011
The Executive Board of Funkwerk provided a positive outlook for 2011 and
the years following. 'The measures which we have completed and the
structural changes initiated have considerably improved the starting basis
of Funkwerk in the current financial year. Together with the investments in
new products and solutions, our strategic focusing and further structural
improvements Funkwerk should effectively generate profit again from 2011,'
it says in its management report.
For its Traffic&Control Communication segment, Funkwerk expects that
demand for communication technology in the railway sector will increase in
2011 and the following years, as rail transport will be advanced to save
resources and infrastructure is due for development in the threshold
countries. The Security Communication segment is expected to grow
significantly in the medium term, in line with the growing demand for
intelligent solutions for the protection of people, buildings, public
places and objects. Funkwerk is considered a leading specialist in this
area and plans to expand business at international level through
cooperation with infrastructure suppliers. According to the Executive
Board, demand in Automotive Communication will also surge, with significant
growth for the sector in the medium term, specifically in the OEM business
of vehicle manufacturers.
The launch of new products and solutions prepared in 2010 and fully taking
effect in 2011 and specific internationalisation are said to give rise to
hopes of organic growth in these segments. These are the growth markets on
which Funkwerk plans to focus in particular in the future, which includes
exercising appropriate strategic options.
The Executive Board believes that effective focal points of the company's
expertise will in future include such technology areas as radio
communication, data transmission and data processing. Based on this,
Funkwerk is to become, in the long run, one of the top 5 companies
providing communication, information and security solutions for key
components for infrastructures in Europe and an indispensable supplier for
vehicle manufacturers and infrastructure suppliers.
The full annual financial statements of Funkwerk AG are available on the
Internet at www.funkwerk.com and on the website of Deutsche Börse AG.
For further information contact
Funkwerk AGEnd of Corporate News
Im Funkwerk 5
99625 Kölleda/Thüringen, Sebastian
Germany
Jörg Reichenbach
Investor Relations
Phone: Brunner
communications-
0 36 35/6 00 -3 46
Fax: 0 36 35/6 00 -5 +consulting
Tel: 0175/
07
reichenbach(at)funkwerk.com 5604673
fsbrunner(at)aol.-
com
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31.03.2011 Dissemination of a Corporate News, transmitted by DGAP - a
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Language: English
Company: Funkwerk AG
Im Funkwerk 5
99625 Kölleda
Deutschland
Phone: +49 (0)3635 600 0
Fax: +49 (0)3635 600 507
E-mail: info(at)funkwerk.com
Internet: www.funkwerk.com
ISIN: DE0005753149
WKN: 575314
Listed: Regulierter Markt in Frankfurt (Prime Standard);
Freiverkehr in Berlin, Düsseldorf, Hamburg, München,
Stuttgart
End of News DGAP News-Service
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117714 31.03.2011Unternehmensinformation / Kurzprofil:
Datum: 31.03.2011 - 08:01 Uhr
Sprache: Deutsch
News-ID 33662
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