Annual targets are no longer attainable due to subdued demand from the machine construction, automotive and semiconductor equipment industries, as well as project postponements and more stringent export restrictions.
JENOPTIK AG has revised its 2014 revenue and earnings guidance despite high order intakes. On the condition that a major international order in the Defense & Civil Systems segment can still be completed by year-end, the Executive Board is now expecting Group revenue for the current fiscal year to come in at about 600 million euros (prior year 600.3 million euros). Group operating result (EBIT) is due to total around 50 million euros (prior year 52.7 million euros). This shall apply provided that uncertainties in the defense business will not increase over the coming weeks. The prior guidance for 2014 included revenue growth of around 5 percent and Group EBIT of approximately 55 million euros.
The reduced forecast for the 2014 annual targets is particularly the result of deteriorating external circumstances:
On the one hand, demand from the machine construction, semiconductor equipment and automotive industries was significantly weaker in recent weeks and remained substantially below the expectations of Jenoptik, thus negatively impacting on the course of business in the Lasers & Optical Systems and Metrology segments. This situation is exacerbated by project postponements on the part of customers.
On the other hand, increasingly stringent armament export restrictions issued by the German government due to the crisis in Russia and Ukraine will also result in lost revenue for the Jenoptik Group, in particular in the Defense & Civil Systems segment, in the low double-digit million euro range.
"Current economic figures and market conditions are noticeably impacting on our customers' capital spending patterns. In view of this, our projected growth targets for 2014, despite a significantly improved year-on-year Group order intake, are no longer achievable," says Michael Mertin, President & CEO of Jenoptik. "The good order situation has, however, created the conditions for profitable growth in the coming fiscal year," adds Chief Financial Officer Rüdiger Andreas Günther.
The Jenoptik Group will continue to consistently pursue its present strategy. Due to the adverse development of business in 2014 resulting from external circumstances, however, the Executive Board is extending its planning horizon for the Group's medium-term forecast. The company accordingly now anticipates annual revenue of around 800 million euros with an average EBIT margin of 9 to 10 percent over the market cycles, and including smaller corporate acquisitions, to be achieved in 2018, one year later than originally planned.
"Postponing the attainment of our medium-term revenue target of 800 million euros does not represent a change in strategy. We have ensured that Jenoptik is in an excellent strategic position and steered the company on a stable course. No matter how rough the seas, we will maintain this course and achieve our targets," says Michael Mertin.
Jenoptik will publish its figures on the first nine months of 2014 on November 12. According to preliminary estimates, Group revenue will be slightly below the level in the prior year (prior year 432.5 million euros), Group EBIT will be at last year's level (prior year 37.5 million euros). In the period covered by the report, the Group will state a substantial increase in order intake (prior year 415.4 million euros).
This announcement can contain forward-looking statements that are based on current expectations and certain assumptions of the management of the Jenoptik Group. A variety of known and unknown risks, uncertainties and other factors can cause the actual results, the financial situation, the development or the performance of the company to be materially different from the announced forward-looking statements. Such factors can be, among others, changes in currency exchange rates and interest rates, the introduction of competing products or the change of the business strategy. The company does not assume any obligation to update such forward-looking statements in the light of future developments.
JENOPTIK AG has revised its 2014 revenue and earnings guidance despite high order intakes. On the condition that a major international order in the Defense & Civil Systems segment can still be completed by year-end, the Executive Board is now expecting Group revenue for the current fiscal year to come in at about 600 million euros (prior year 600.3 million euros). Group operating result (EBIT) is due to total around 50 million euros (prior year 52.7 million euros). This shall apply provided that uncertainties in the defense business will not increase over the coming weeks. The prior guidance for 2014 included revenue growth of around 5 percent and Group EBIT of approximately 55 million euros.
The reduced forecast for the 2014 annual targets is particularly the result of deteriorating external circumstances:
On the one hand, demand from the machine construction, semiconductor equipment and automotive industries was significantly weaker in recent weeks and remained substantially below the expectations of Jenoptik, thus negatively impacting on the course of business in the Lasers & Optical Systems and Metrology segments. This situation is exacerbated by project postponements on the part of customers.
On the other hand, increasingly stringent armament export restrictions issued by the German government due to the crisis in Russia and Ukraine will also result in lost revenue for the Jenoptik Group, in particular in the Defense & Civil Systems segment, in the low double-digit million euro range.
"Current economic figures and market conditions are noticeably impacting on our customers' capital spending patterns. In view of this, our projected growth targets for 2014, despite a significantly improved year-on-year Group order intake, are no longer achievable," says Michael Mertin, President & CEO of Jenoptik. "The good order situation has, however, created the conditions for profitable growth in the coming fiscal year," adds Chief Financial Officer Rüdiger Andreas Günther.
The Jenoptik Group will continue to consistently pursue its present strategy. Due to the adverse development of business in 2014 resulting from external circumstances, however, the Executive Board is extending its planning horizon for the Group's medium-term forecast. The company accordingly now anticipates annual revenue of around 800 million euros with an average EBIT margin of 9 to 10 percent over the market cycles, and including smaller corporate acquisitions, to be achieved in 2018, one year later than originally planned.
"Postponing the attainment of our medium-term revenue target of 800 million euros does not represent a change in strategy. We have ensured that Jenoptik is in an excellent strategic position and steered the company on a stable course. No matter how rough the seas, we will maintain this course and achieve our targets," says Michael Mertin.
Jenoptik will publish its figures on the first nine months of 2014 on November 12. According to preliminary estimates, Group revenue will be slightly below the level in the prior year (prior year 432.5 million euros), Group EBIT will be at last year's level (prior year 37.5 million euros). In the period covered by the report, the Group will state a substantial increase in order intake (prior year 415.4 million euros).
This announcement can contain forward-looking statements that are based on current expectations and certain assumptions of the management of the Jenoptik Group. A variety of known and unknown risks, uncertainties and other factors can cause the actual results, the financial situation, the development or the performance of the company to be materially different from the announced forward-looking statements. Such factors can be, among others, changes in currency exchange rates and interest rates, the introduction of competing products or the change of the business strategy. The company does not assume any obligation to update such forward-looking statements in the light of future developments.
