Schlatter Group continues its market success

The Schlatter Group increased its net sales by 13.3 percent to CHF 138.0 million in the first half of 2008 (1H 2007: CHF 121.9 million). While net sales in the higher-volume welding segment rose by 11.9 percent, the weaving segment saw sales increase by 17.6 percent. As at June 30, 2008, the Schlatter Group's order backlog stood at CHF 160.7 million, down 12.3 percent on December 31, 2007 (CHF 183.2 million), and down 3.8 percent on the equivalent year-back period (CHF 167.1 million).

The Schlatter Group posted an operating result (EBIT) of CHF 7.5 million (CHF 5.4 million) for the first half of 2008, which corresponds to an EBIT margin of 5.4 percent (4.4 percent). The result was depressed by an adjustment to an account receivable amounting to CHF 0.9 million made necessary by the insolvency of a customer in the weaving segment.

The Group posted a first-half-year profit of CHF 4.3 million (CHF 3.0 million). The result suffered from currency-related losses stemming from the strengthening of the CHF against the EUR and the USD.

The order intake is down slightly but still at a high level. This meant that there was a lower volume of advance payments on customer projects. In addition, significant investments totalling CHF 7.0 million were made in fixed and intangible assets, particularly for the expansion of the Schlieren site. The operating free cash flow is therefore negative at CHF -14.5 million (CHF -1.9 million).

The number of full-time employees increased from 500 as of June 30, 2007, to 513. Sales per employee increased by 9.7 percent to CHF 271,000 (247,000).

Welding segment Net sales for the welding segment rose to CHF 103.3 million (CHF 92.3 million). As of mid-year, the order backlog stood at CHF 104.8 million (CHF 128.3 million). EBIT for the first six months of 2008 increased by 53.7 percent to CHF 6.0 million (CHF 3.9 million). However, the result was adversely affected by cost overruns on certain customer projects.

Weaving segment In the first half of 2008, net sales in the weaving segment rose to CHF 34.7 million (CHF 29.5 million). As of June 30, 2008, the order backlog stood at CHF 55.9 million (CHF 38.8 million). Despite the higher sales, EBIT declined to CHF 1.5 million (CHF 1.7 million). The result was affected by a customer insolvency which had a negative impact amounting to CHF 0.9 million.

Outlook Demand for Schlatter Group products remains stable at a high level. Group management continues to give high priority to improving process management and security and to completing projects efficiently and on schedule. As well as striving to boost profitability, Schlatter also plans to step up its efforts to integrate the sites within the Group.

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