Komax Holding AG (SWF:KOMN) Komax Group: Business In The First Half Of 2008

Komax Holding AG (SWF:KOMN) Higher sales and strong order intake

The Komax Group lifted sales by 2.6 percent in the first half of 2008 to CHF 170.2 million. Order intake was up by 15.6 percent, pointing to a healthy result for the year as a whole.

The Komax Group lifted sales to CHF 170.2 million in the first half of 2008 (previous year: CHF 165.8 million), a rise of 2.6 percent (adjusted for exchange rate movements: 6.8 percent). Operating profit (EBIT) decreased by 2.3 percent to CHF 20.1 million (previous year: CHF 20.6 million), with the Group posting an EBIT margin of 11.8 percent (adjusted for exchange rate movements: 13.3 percent). Earnings after tax (EAT) came to CHF 14.5 million (previous year: CHF 16.0 million). The 8.9 percent decline was due to net finance costs of CHF -1.5 million (previous year: CHF -0.2 million), which stemmed in turn from exchange rate movements.

Order intake showed a most encouraging picture. At the end of the first six months, orders in hand were up by 15.6 percent year on year (adjusted for exchange rate movements: 18.1 percent) to CHF 209.7 million (previous year: CHF 181.4 million). The high order intake also impacted on free cash flow, which stood at CHF 11.8 million (previous year: CHF 20.9 million) due to the increase in net current assets.

Broadly diversified growth

Business in Europe in particular continued to perform well: here the Group as a whole increased sales by 16 percent. Growth was also strong in North Africa where sales doubled on the back of some large orders in the cable segment. In the US too, cable segment sales rose sharply year on year and were therefore much improved, while in Asia wire-processing sales increased by around 30 percent.

In addition, Komax established a new subsidiary in India on 1 July 2008 and opened a new branch office in Russia during the first half of the year. Going forward, this will bring a sustained improvement in the Group's market coverage in these regions and will further expand its distribution and service network.

Market leadership further extended

The Group continued to extend its market leadership in wire processing, mainly as a result of its broad range of highly innovative machines spanning cut and strip, crimp to crimp and processing systems for the assembly of complete wire harnesses. The wire-processing machines are used primarily to manufacture wire harnesses in motor vehicles, domestic appliances and various electronic devices.

Demand in the first half of the year far outstripped expectations, especially in the automotive sector. This is partly because petrol consumption can be reduced by increasing the number of electronic devices and controllers on board a vehicle - with stop-and-go automation a key feature. This trend is particularly noticeable among the booming hybrid cars, which have up to 40 percent more wire connectors than conventional cars. However, demand is being sustained not only by new, alternative drive concepts, but also by comfort and safety applications.

Assembly automation and medtech

Profit margins in the assembly automation segment, and more specifically on the manufacture of systems for the assembly of electronic and mechanical components, have come under increasing pressure in recent years due to continuing strong competition. Komax has therefore become much more selective in choosing projects. Furthermore, any capacity that becomes available is urgently required in the photovoltaic segment.

Business performance in the medtech segment fell slightly short of the high expectations in the first half of the year. Various larger orders were put on hold or placed late. Komax expects a clear improvement in the situation in the second half of 2008.

High growth in photovoltaics

The photovoltaic segment remains in a robust state of health. Here, Komax supplies sophisticated solutions for the production of both crystalline modules (stringing) and thin-film / back-end modules (contact attachment systems). Komax has expanded its product portfolio significantly in recent years.

At the most important trade fair for the photovoltaic industry, the 23rd European Photovoltaic Solar Energy Conference and Exhibition to be held in Valencia in September, Komax will present a variety of products including the new Xcell 3400 stringer, a further milestone in the automated manufacture of solar modules. Overall, Komax is confident of maintaining the strong growth in the photovoltaic segment. The Group Management has been bolstered by the addition of Walter Nehls, a newcomer to the Group, who heads its photovoltaic business.

Outlook

The strong business performance is likely to continue during the second half of 2008. The high order intake in the first half of the year points to another healthy result for 2008 as a whole.

Background information on the Komax Group

The Komax Group, founded in 1975 and headquartered in Dierikon/Lucerne, Switzerland, is one of the top global providers of wire processing systems and assembly automation equipment. The Komax Group operates production facilities in Switzerland, Portugal, France, the United States, Malaysia and China. It also maintains a distribution and service network spanning the entire globe. Its primary markets are the automotive industry, medical technology and photovoltaics, as well as the domestic appliance and office equipment sectors.

Key figures of the Komax Group

+--------------------------------------------------------------+ | Consolidated balance sheet | 30.6.2008 | 31.12.2007 | Change | |----------------------------+-----------+------------+--------| | | CHF 1,000 | CHF 1,000 | % | |----------------------------+-----------+------------+--------| | Current assets | 215,524 | 199,373 | 8.1 | |----------------------------+-----------+------------+--------| | Non-current assets | 108,409 | 111,573 | -2.8 | |----------------------------+-----------+------------+--------| | Total assets | 323,933 | 310,946 | 4.2 | |----------------------------+-----------+------------+--------| | Current liabilities | 96,796 | 76,169 | 27.0 | |----------------------------+-----------+------------+--------| | Non-current liabilities | 9,260 | 9,473 | -2.2 | |----------------------------+-----------+------------+--------| | Shareholders' equity | 217,199 | 224,491 | -3.2 | |----------------------------+-----------+------------+--------| | Minority interest | 678 | 786 | -13.7 | +--------------------------------------------------------------+



+-------------------------------------------------------------------+ | Consolidated income | 1st half 2008 | 1st half 2007 | Change | | statement | | | | |--------------------------+---------------+---------------+--------| | | CHF 1,000 | CHF 1,000 | % | |--------------------------+---------------+---------------+--------| | Order intake | 209,680 | 181,375 | 15.6 | |--------------------------+---------------+---------------+--------| | Net sales | 170,234 | 165,847 | 2.6 | |--------------------------+---------------+---------------+--------| | Gross profit | 100,201 | 97,875 | 2.4 | |--------------------------+---------------+---------------+--------| | Operating profit (EBDIT) | 24,096 | 24,479 | -1.6 | |--------------------------+---------------+---------------+--------| | Operating profit (EBIT) | 20,141 | 20,608 | -2.3 | |--------------------------+---------------+---------------+--------| | Financial result | -1,494 | -157 | 851.6 | |--------------------------+---------------+---------------+--------| | Group profit after tax | 14,526 | 15,950 | -8.9 | | (EAT) | | | | +-------------------------------------------------------------------+



+-------------------------------------------------------------------+ | Consolidated cash flow | 1st half 2008 | 1st half | Change | | statement | | 2007 | | |------------------------------+---------------+-----------+--------| | | CHF 1,000 | CHF 1,000 | % | |------------------------------+---------------+-----------+--------| | Net cash from operating | 13,900 | 23,790 | -41.6 | | activities | | | | |------------------------------+---------------+-----------+--------| | Net cash from investing | -2,088 | -2,876 | -27.4 | | activities | | | | |------------------------------+---------------+-----------+--------| | Free cash flow | 11,812 | 20,914 | -43.5 | |------------------------------+---------------+-----------+--------| | Net cash from financing | 3,554 | 3,806 | -6.6 | | activities | | | | |------------------------------+---------------+-----------+--------| | Dividend Distribution1) | -21,718 | 0 | | |------------------------------+---------------+-----------+--------| | Increase (+) / Decrease (-) | 13,387 | 24,941 | -46.3 | | in funds | | | | +-------------------------------------------------------------------+

Funds = cash and cash equivalents (including time deposits with a term of up to three months) 1) Par value repayments of CHF 3.40 in August 2007 and dividende of CHF 6.50 per share paid in May 2008

+-------------------------------------------------------------------+ | Key figures | | 2008 | 2007 | |-------------------------------------+-----------+--------+--------| | Net indebtedness (-) / Net assets | CHF 1,000 | 12,978 | 20,034 | | (+) 30.6.2008 / 31.12.2007 | | | | |-------------------------------------+-----------+--------+--------| | Gross profit 1st half in % of net | % | 58.9 | 59.0 | | sales | | | | |-------------------------------------+-----------+--------+--------| | Cash flow (EBDIT) 1st half in % of | % | 14.2 | 14.8 | | net sales | | | | |-------------------------------------+-----------+--------+--------| | Operating profit (EBIT) 1st half in | % | 11.8 | 12.4 | | % of net sales | | | | |-------------------------------------+-----------+--------+--------| | Group profit (EAT) 1st half in % of | % | 8.5 | 9.6 | | net sales | | | | |-------------------------------------+-----------+--------+--------| | Headcount as of 30.6.2008 / | Number | 1,107 | 1,050 | | 31.12.2007 | | | | +-------------------------------------------------------------------+

The complete financial statements for the first half 2008 can be downloaded from the Internet at www.komaxgroup.com or ordered by phone.



Contact: Komax Holding AG Direct dial +41 41 455 06 16 Dominik Slappnig, Investor Fax +41 41 450 10 24 Relations www.komaxgroup.com dominik.slappnig@komaxgroup.com



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LINK: http://hugin.info/100418/R/1245994/269294.pdf

Komax Holding AG

http://www.komax.ch

ISIN: CH0010702154

Stock Identifier: XSWX.KOMN

US: Other OTC:KMAAF