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Phoenix Mecano in the first nine months of 2021: Strong growth in sales and incoming orders – Profitability above pre-crisis level – Focus on technological megatrends paying off

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Phoenix Mecano AG / Key word(s): Quarter Results

02-Nov-2021 / 07:00 CET/CEST
Release of an ad hoc announcement pursuant to Art. 53 LR
The issuer is solely responsible for the content of this announcement.

Ad hoc announcement pursuant to Art. 53 LR

Kloten/Stein am Rhein, 2 November 2021. The broad-based recovery in the Phoenix Mecano Group's target markets continued in the third quarter of 2021. The Group achieved cumulative double-digit growth rates in sales and incoming orders in the first nine months. The earnings situation also improved significantly.

Performance would have been even better had it not been for the challenging situation in procurement markets and supply chains. Through forward-looking management of its supplier base and by passing on the sometimes considerable cost increases, Phoenix Mecano succeeded in minimising the impacts of the supply chain situation on the Group results.

The outlook therefore remains positive and the guidance for financial year 2021 can be confirmed.

In the first three quarters of 2021, the Phoenix Mecano Group increased its consolidated gross sales by 22.7% from EUR 498.3 million to EUR 611.4 million. Organic growth in local currency was 22.6%. Net sales totalled EUR 606.0 million (previous year: EUR 494.6 million). Incoming orders rose by 20.6% from EUR 535.8 million to EUR 646.1 million. The book-to-bill ratio for the first nine months was 105.7%, a figure that should allow continued growth in the months ahead.

The operating result increased by 92.7% from EUR 21.3 million to EUR 41.1 million and the operating cash flow by 40.5% from EUR 40.9 million to EUR 57.5 million.

The result of the period after taxes was EUR 27.3 million, up 139.0% on the previous year (EUR 11.4 million).

With these key financials, the Phoenix Mecano Group was well above its 2019 pre-crisis level in the first nine months of 2021.

Development of the Group's divisions

In the DewertOkin Technology Group (DOT Group) division, sales in the first three quarters of 2021 were up by 31.9% to EUR 292.6 million. Adjusted for acquisitions and measured in local currency, the increase was 30.9%. Incoming orders rose by 9.8% to EUR 277.4 million. The operating cash flow declined by 13.5% to EUR 13.1 million and the operating result by 13.8% to EUR 8.3 million.

For the leading provider of electrified drive system solutions for the furniture industry, 2021 has seen sharp cost increases and availability issues affecting semiconductors and raw materials, especially industrial metals and plastic pellets. Exorbitant rises in freight costs as well as pandemic-related lockdowns at major freight ports have also presented the globally active DOT Group with major challenges.

Over the course of the year, the management has implemented a number of targeted measures on strategic purchasing. Due to the complexity of supply chains, the full effects of the necessary price rises will only be felt with a delay of several months. The division is vigorously pursuing strategic growth investments in production capacity and product development with a view to its planned partial IPO.

In the Industrial Components division, the first nine months of financial year 2021 saw gross sales increase by 16.6% to EUR 168.7 million (previous year: EUR 144.6 million) and incoming orders rise by 41.2% to EUR 206.3 million (previous year: EUR 146.1 million). Organic, local-currency gross sales were up by 16.6%. The operating cash flow increased by 216.6% to EUR 19.9 million, while the operating result stood at EUR 13.9 million.

Structural growth in the industrial automation sector drove a continued recovery in the Rose+Krieger market segment in the third quarter and led to a historically high level of orders on hand.

With supply chains under pressure everywhere, customers of the Electrotechnical Components business area were placing orders with longer lead times. This led to an increase in incoming orders in the core markets of Europe and Asia, prompting a temporary expansion of production capacity in Tunisia.

The Rugged Computing and Measuring Technology business areas saw high demand from Europe, which was reflected in a further improvement in operating margins.

In the Enclosure Systems division, gross sales in the first three quarters of 2021 rose by 13.8% to EUR 150.1 million. In organic, local-currency terms, the increase was 15.7%. Incoming orders increased by 18.5% to EUR 162.3 million. The operating cash flow was EUR 25.9 million (previous year: EUR 18.9 million). The operating result climbed by 57.6% from EUR 13.5 million to EUR 21.3 million.

Increasing raw material prices were passed on in the form of price rises, so the EBIT margin in the third quarter was again just over 14%. The end markets for electronic enclosures and human-machine interfaces saw high growth rates, driven by megatrends such as Internet of Things applications and industrial digitalisation. However, activity remained subdued in the project business for explosion-proof enclosures.


Outlook

A positive environment continues to prevail in many end markets and market regions of relevance to the Phoenix Mecano Group. While the global indices for industrial activity (IHS Markit) and business outlook (PMI) have dipped slightly in recent months, they remain well within the growth zone. Economists are now paying close attention to the increased risk of inflation due to global supply chain issues.

Phoenix Mecano operates in structurally growing, high-potential markets driven by global megatrends. The Group's management expects Phoenix Mecano to be able to further increase sales and boost profitability in the current environment. Business development initiatives, in particular ongoing investment programmes, will therefore continue to be pursued consistently in the year ahead.

Against this backdrop, the management and Board of Directors reaffirm their full-year guidance for 2021 - updated at the time of the half-year results - of an operating profit in excess of EUR 43 million.

For more information, please contact:
Phoenix Mecano Management AG
Dr Rochus Kobler, CEO
Lindenstrasse 23, CH-8302 Kloten
Tel.: +41 (0)43 255 4 255
info@phoenix-mecano.com
www.phoenix-mecano.com

About Phoenix Mecano
The Phoenix Mecano Group is a global player in the enclosures and industrial components segments and is a leader in many markets. Headquartered in Stein am Rhein, Switzerland, the Group employs around 7,500 people worldwide and generated sales of approximately EUR 687 million in 2020. It is geared towards the professional and cost-effective manufacture of niche products and system solutions for customers in the mechanical engineering, measurement and control technology, medical technology, aerospace technology, alternative energy and home and hospital care sectors. Phoenix Mecano was founded in 1975 and has been listed on the Swiss stock exchange since 1988.

Results Q1 - Q3 2021 in figures (in EUR million)

1-9 2020*

1-9 2021

in %

Incoming orders

535.8

646.1

20.6

Gross sales

498.3

611.4

22.7

per division:

DewertOkin Technology (DOT)

221.8

292.6

31.9

Industrial Components

144.6

168.7

16.6

Enclosure Systems

131.9

150.1

13.8

Net sales

494.6

606.0

22.5

Operating cash flow

40.9

57.5

40.5

Margin

8.2%

9.4%

Operating result

21.3

41.1

92.7

Margin

4.3%

6.7%

per division:

DewertOkin Technology (DOT)

9.6

8.3

-13.8

4.3%

2.8%

Industrial Components

-1.9

13.9

845.8

-1.3%

8.2%

Enclosure Systems

13.5

21.3

57.6

10.3%

14.2%

Other

0.1

-2.4

Result of the period

11.4

27.3

139.0

Margin

2.3%

4.5%

* Division figures adapted to the new division structure 2021

Results Q3 2021 in figures (in EUR million)

7-9 2020*

7-9 2021

in %

Incoming orders

215.7

205.8

-4.6

Gross sales

196.2

207.1

5.6

per division:

DewertOkin Technology (DOT)

103.2

98.5

-4.6

Industrial Components

49.3

57.7

17.1

Enclosure Systems

43.7

50.9

16.5

Net sales

195.1

204.5

4.9

Operating cash flow

22.4

22.1

-1.2

Margin

11.4%

10.7%

Operating result

14.9

16.4

10.5

Margin

7.6%

7.9%

per division:

DewertOkin Technology (DOT)

7.4

4.0

-46.0

7.2%

4.1%

Industrial Components

1.5

5.3

241.4

3.1%

9.1%

Enclosure Systems

4.9

7.9

60.1

11.3%

15.5%

Other

1.1

-0.8

-165.5

Result of the period

10.2

10.7

5.1

Margin

5.2%

5.2%

* Divisions adapted to the new division structure 2021


End of ad hoc announcement

Language:

English

Company:

Phoenix Mecano AG

Hofwisenstrasse 6

8260 Stein am Rhein

Switzerland

Phone:

+41 (0)43 255 4 255

ISIN:

CH0002187810

Listed:

SIX Swiss Exchange

EQS News ID:

1245273


 

End of Announcement

EQS Group News Service

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