Business figures
LEM reports weak first half in 2024/25
LEM announces its results for the first half of 2024/25 (April-September), with partly dramatic declines in the key figures.
The results show the following facts:
- Sales declined 29.9% to CHF 156.5 million (H1 2023/24: CHF 223.3 million); at constant exchange rates, the decrease was 29.0%. In sequential terms, Q2 2024/25 sales were down 6.6% compared to Q1 2024/25.
- LEM recorded significant sales declines in the EMEA region of 37.9%, in Rest of Asia of 42.7% and in the Americas of 29.4%, while China was down 11.7%.
- Overall, bookings decreased by 9.7% compared to the previous year's level to CHF 127.9 million (CHF 141.5 million); the book-to-bill ratio was 0.82.
- EBIT was down by 72.6% to CHF 14.2 million (CHF 51.7 million); the EBIT margin stood at 9.1%. Net profit for the period fell to CHF 8.6 million, resulting in a net profit margin of 5.5% (CHF 43.4 million; 19.4%).
- Cash flow from operating activities amounted to CHF -2.7 million (CHF 37.3 million) as a result of the lower profit level and an increase in net working capital.
LEM currently expects the business environment to remain subdued. Therefore, the company expects sales in the range of CHF 290 to 310 million for the full year 2024/25 and a high single-digit EBIT margin. Considering this outlook, LEM has launched the performance improvement program "Fit for Growth", which will review the organizational structure and related operating expenses, as well as indirect operational costs.
Frank Rehfeld, Chief Executive Officer, said: "The global electronics industry is experiencing significant headwinds. Therefore, the result in the first half of 2024/25, while certainly disappointing looking at our overall growth ambitions, was not unexpected. The slowdown in the electronics industry, weak EV sales in Europe and North America, and persistently high inventories in some of our key industries did not leave us unaffected. However, we have used the time to further develop the company. With the acceleration of our innovation process through our new and expanded R&D centers in Munich and Shanghai, the expansion and flexibilization of our production footprint through the Penang site, our greater customer proximity and the cost initiatives we have implemented, LEM is in a very good position. As a one-stop shop with the largest and broadest product portfolio in the industry, we are ready to continue to benefit from the fundamental, environmentally friendly trends in the areas of electrification, renewable energies and e-mobility as soon as the businesses pick up again."
Andrea Borla, Chief Financial Officer, commented: "The significant decline in the EBIT margin is the result of the 29.9% decline in sales and the associated under-absorption of fixed costs, as well as a less favorable product and geographic mix. At present, we see no signs of a recovery in our markets in the second half of 2024/25. For this reason, our guidance for the full year is significantly below the previous year, and we are going to intensify our work to improve our overall cost position."
