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Results Third Quarter 2003

Results Third Quarter 2003. Martin De Prycker President & CEO November 6, 2003. Operational results Q3 2003 and YTD 2003. Results per quarter. in € mio. Overall comments Q3 2003. Comparable sales growing 6.2% at unchanged €/$ vs Q3 2002 Nominal sales flat vs Q3 2003

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Results Third Quarter 2003

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  1. Results Third Quarter 2003 Martin De Prycker President & CEO November 6, 2003

  2. Operational results Q3 2003 and YTD 2003

  3. Results per quarter in € mio

  4. Overall comments Q3 2003 • Comparable sales growing 6.2% at unchanged €/$ vs Q3 2002 • Nominal sales flat vs Q3 2003 • Weak orders and sales in July and August but strong retake in September, continuing in October • Book-to-bill ratio at 1.01 lower than Q3 2002, because of long term contracts in ATC and defense in Q3 2002 • EBITA at 6.9%, slightly lower than Q3 2002 (7.2%), mainly caused by • 5.4 € Mio, due to dollar and pegged currencies decline • Lower gross profit from 44% to 42% because of unfavorable product mix and higher relative indirect manufacturing cost • Partially compensated by increasing efficiency • Net income 6.7 € mio vs 5.9 € mio, including 0.7 € mio for transaction on Machine Vision and lower taxes 0.6 € mio

  5. Evolution of results per division

  6. BarcoProjection (1) in € mio

  7. BarcoProjection (2) • Sales • Increased sales vs Q3 2002 with 3% nominal • Successes • In Media market confirmed (both Europe and US), although at a lower margin • In Control Rooms: sales in Asia are picking up again • Concerns • In Simulation: market remains weak mainly in civil aviation at level of Q2 2003 • Orders • Strong book-to-bill ratio at 1.14 with especially good orders in • Control Rooms: Broadcast (US, Japan) / Traffic & Surveillance worldwide • Events: confirms market leadership both in Europe and US • Presentation: successes in project solutions (Las Vegas) • Strong order book basis for strong Q4 • EBITA • Gross profit margin weaker at 42% vs 44% previous quarter, because of unfavorable product mix, resulting in a weaker EBITA of 5.4 % • Transition of manufacturing of large volume LED walls to China by Q1 2004 will allow us to reduce cost and be $ insensitive • Acquisition status • Leyard acquisition completed in September

  8. BarcoProjection (3) • New products introduced • Media: Hi-res LED wall (3 mm pitch) / LCD panel (40 inch) • Events: world record light output projector (XLM) • Events & Media: MiPIX - modular light/video blocks • Simulation: Trace / Gemini – prepackaged solutions

  9. Evolution in Media product offering • Initial (2002) product offering was identical to events, with too high cost with unnecessary features for media • Early 2003, introduction of S-lite dedicated product with 30% cost reduction versus first product • Early 2004, cost down version under design for manufacturing in China with another 30% cost reduction

  10. BarcoView (1) in € mio

  11. BarcoView (2) • Sales • Total sales YTD increased with 26% vs YTD 2002 • Improved sales volume vs Q2 2003 in medical, both in US and Europe • ATC and Defense & Security: good sales volume vs Q3 2002 (+ 34%), but somewhat lower than Q2 2003 • Orders • Orders in Defense & Security and ATC remain low, but increased commercial activities are expected to result in an increased order level in Q4 • Orders in medical remain at high level, but move to shorter term, getting us to reduce our delivery times • Good orders for Avionics and expected good sales in Q4 • EBITA • Good profit margin of 10.5% • New products introduced • Coronis 3MP Duralight with extended lifetime for medical applications

  12. BarcoVision (1) in € mio

  13. BarcoVision (2) • Sales & Orders • Machine Vision no longer included • Weaker sales volume in textile business as we are in the middle of the low period in this cyclical business • EBITA • Profit margin remains high at 12.4%, despite lower volumes • Machine Vision • The sale of Machine Vision has a non operating result of 0.7 € mio

  14. Barco Manufacturing Services (1) in € mio

  15. Barco Manufacturing Services (2) • Sales & Orders • Weaker sales/orders than Q2 2003 • EBITA • Indirect manufacturing cost not reduced in line with manufacturing volumes, resulting in a slightly positive result (1.9%), weaker than previous quarter • Reorganization • Electronic sub-assembly will be streamlined from 4 locations in Belgium and 1 in the Czech Republic to 1 in Belgium for small series and 1 in the Czech Republic for larger series • Restructuring cost will be taken as a special charge in Q4 and is anticipated around 2.5 € mio, equal to the saving to be realized per year

  16. Geographical breakdown of sales Q2 2003 Q3 2003

  17. Key figures Income Statement

  18. Key figures Balance Sheet

  19. Expectations Q4 2003 • Target orders: 175 - 190 € million, at least 18% higher than Q4 2002 at constant exchange rates • Target sales: 173 - 183 € million, comparable with Q4 2002 at constant exchange rates • Target EBITA: between 23 and 29 € million, before the one time restructuring charge of Barco Manufacturing Services of 2.5 € million • Discussions with partner for dotrix continue • Anticipated tax rate 2003 is 27%

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