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Nederman Holding AB, Sweden
COMPANY WATCH
Nederman Holding AB, Sweden Key Figures (SEK million) First quarter ended 31.3 2010
2009
Net Sales Of Which: Europe International
240.3
295.3
173.6 65.3
220.2 73.7
Cost of Goods Sold
123.2
Gross Profit
PMFG Inc, USA Key Figures (US$ million) Third quarter ended 31.3 2010
2009
Revenues Of Which: Process Products
32.2
37.7
23.8
27.5
Cost of Goods Sold
20.5
25.7
160.9
Gross Profit
11.7
11.8
117.1
134.4
Operating Expenses
8.1
9.4
3.9
4.3
2.3
4.8
Operating Result
9.3
0.4
Operating Income Of Which: Process Products
3.5
13.8
4.4
4.4
Profit/(Loss) before Taxes
7.0
(1.7)
Net Earnings
5.7
0.4
Profit/(Loss) for the Period
5.0
(2.2)
240.8
298.8
Nine months ended 31.3 2010
2009
88.1
120.4
65.9
94.1
R&D Expenses EBITDA
Orders
Revenues Of Which: Process Products
COMMENT Nederman has posted net sales for the first quarter of fiscal 2010 of SEK240.3 million, down 18.6% on the year earlier. Better news was that the firm posted a profit of SEK5.0 million for the period compared with a year earlier loss of SEK2.2 million. The revenue decline was sharpest in Nederman’s European operations where sales were down 21.2% on the 2009 figure at SEK173.6 million, while new orders were 23.4% easier at SEK169.6 million. Its International operations performed better although net sales were still 11.4% lower than the previous year at SEK65.3 million and new orders back 6.6% at SEK68.9 million. Sven Kristensson, Nederman’s CEO, said the company was not expecting sales to recover until the latter part of 2010, although he said good progress had been made with the cost reduction programmes that had been introduced resulting in an increase in gross margins and lower operating costs for the quarter.
June 2010
“It is very positive that despite continued pressure on volumes we can report an improved operating margin,” Kristensson said. “This shows that the savings programmes have had full effect and that we are wellpositioned when volumes begin to pick up.” Towards the end of the quarter, Nederman announced the acquisition of Dantherm Filtration, a move that will effectively double its sales revenues. A business segment within Dantherm AS of Denmark and one of world’s biggest producers of large industrial filters, Dantherm Filtration’s sales in 2009 were approximately SEK980 million and it has around 900 employees. Nederman has paid DKK280 million for the acquisition, having secured long-term bank financing. As part of the agreement with the bank, Nederman’s two largest shareholders, Investment AB Latour and Ernströmgruppen AB have pledged securities to the bank. ■ www.nederman.com
Cost of Goods Sold
56.4
85.1
Gross Profit
31.7
35.3
Operating Expenses
25.0
30.2
Operating Income Of Which: Process Products
6.7
5.1
12.0
11.9
Net Earnings/(Loss)
(2.3)
0.3
COMMENT PMFG’s Process Products segment, formerly the Separation/ Filtration Systems division, saw its revenues for the third quarter of fiscal 2010 decrease 13.2% on the year earlier to reach US$23.8 million. The segment’s operating income was static on the 2009 quarter at US$4.4 million. “Our third quarter results are indicative of the early signs of improvement we see in many of our world-wide end markets,” Peter Burlage, CEO, said. “We are particularly pleased with our backlog performance, project mix, and strong margins. Our backlog at March 31, 2010 was US$88 million compared to US$78 million at December 31, 2009.” Burlage
said that order had continued to improve throughout the quarter for the majority of PMFG’s product portfolio, with notable strength exhibited by the Process Products segment. “Productivity is becoming embedded in everything we do and we are extending that energy to also focus on innovation,” he said. “PMFG employees continue to find new opportunities to serve customer needs, improve operations and drive financial performance. With the continued improvement in our overall business conditions, combined with the benefits from our cost management activities, we expect our businesses to return to year-over-year growth in fiscal year 2011.” ■ www.peerlessmfg.com
Filtration Industry Analyst
11
Nederman Holding AB, Sweden Key Figures (SEK million) First quarter ended 31.3 2010
2009
Net Sales Of Which: Europe International
240.3
295.3
173.6 65.3
220.2 73.7
Cost of Goods Sold
123.2
Gross Profit
PMFG Inc, USA Key Figures (US$ million) Third quarter ended 31.3 2010
2009
Revenues Of Which: Process Products
32.2
37.7
23.8
27.5
Cost of Goods Sold
20.5
25.7
160.9
Gross Profit
11.7
11.8
117.1
134.4
Operating Expenses
8.1
9.4
3.9
4.3
2.3
4.8
Operating Result
9.3
0.4
Operating Income Of Which: Process Products
3.5
13.8
4.4
4.4
Profit/(Loss) before Taxes
7.0
(1.7)
Net Earnings
5.7
0.4
Profit/(Loss) for the Period
5.0
(2.2)
240.8
298.8
Nine months ended 31.3 2010
2009
88.1
120.4
65.9
94.1
R&D Expenses EBITDA
Orders
Revenues Of Which: Process Products
COMMENT Nederman has posted net sales for the first quarter of fiscal 2010 of SEK240.3 million, down 18.6% on the year earlier. Better news was that the firm posted a profit of SEK5.0 million for the period compared with a year earlier loss of SEK2.2 million. The revenue decline was sharpest in Nederman’s European operations where sales were down 21.2% on the 2009 figure at SEK173.6 million, while new orders were 23.4% easier at SEK169.6 million. Its International operations performed better although net sales were still 11.4% lower than the previous year at SEK65.3 million and new orders back 6.6% at SEK68.9 million. Sven Kristensson, Nederman’s CEO, said the company was not expecting sales to recover until the latter part of 2010, although he said good progress had been made with the cost reduction programmes that had been introduced resulting in an increase in gross margins and lower operating costs for the quarter.
June 2010
“It is very positive that despite continued pressure on volumes we can report an improved operating margin,” Kristensson said. “This shows that the savings programmes have had full effect and that we are wellpositioned when volumes begin to pick up.” Towards the end of the quarter, Nederman announced the acquisition of Dantherm Filtration, a move that will effectively double its sales revenues. A business segment within Dantherm AS of Denmark and one of world’s biggest producers of large industrial filters, Dantherm Filtration’s sales in 2009 were approximately SEK980 million and it has around 900 employees. Nederman has paid DKK280 million for the acquisition, having secured long-term bank financing. As part of the agreement with the bank, Nederman’s two largest shareholders, Investment AB Latour and Ernströmgruppen AB have pledged securities to the bank. ■ www.nederman.com
Cost of Goods Sold
56.4
85.1
Gross Profit
31.7
35.3
Operating Expenses
25.0
30.2
Operating Income Of Which: Process Products
6.7
5.1
12.0
11.9
Net Earnings/(Loss)
(2.3)
0.3
COMMENT PMFG’s Process Products segment, formerly the Separation/ Filtration Systems division, saw its revenues for the third quarter of fiscal 2010 decrease 13.2% on the year earlier to reach US$23.8 million. The segment’s operating income was static on the 2009 quarter at US$4.4 million. “Our third quarter results are indicative of the early signs of improvement we see in many of our world-wide end markets,” Peter Burlage, CEO, said. “We are particularly pleased with our backlog performance, project mix, and strong margins. Our backlog at March 31, 2010 was US$88 million compared to US$78 million at December 31, 2009.” Burlage
said that order had continued to improve throughout the quarter for the majority of PMFG’s product portfolio, with notable strength exhibited by the Process Products segment. “Productivity is becoming embedded in everything we do and we are extending that energy to also focus on innovation,” he said. “PMFG employees continue to find new opportunities to serve customer needs, improve operations and drive financial performance. With the continued improvement in our overall business conditions, combined with the benefits from our cost management activities, we expect our businesses to return to year-over-year growth in fiscal year 2011.” ■ www.peerlessmfg.com
Filtration Industry Analyst
11