Financial results of The ES-SYSTEM Group for Q1+Q2 2014

Warsaw, August 25, 2014
Press Release
FINANCIAL RESULTS OF THE ES-SYSTEM GROUP FOR Q2 2014
ACCELERATION IN SALES, POSITIVE PROFITS,
PROSPECTS FOR GROWTH IN FUTURE QUARTERS
Q2 2014
Q2 2013
Change %
1H 2014
1H 2013
Change %
Revenue from sales
40 181
36 571
9,9%
74 078
70 736
4,7%
Operating costs
14 313
11 783
21,5%
27 774
24 160
15%
EBIT
as % of revenue
29
0,1%
1 107
3,0%
(97,4%)
(204)
(0,3%)
678
1%
(130,1%)
EBITDA
as % of revenue
2 194
5,5%
3 155
8,6%
(30,4%)
4 030
5,4%
4 750
6,7%
(15,2%)
Net profit
as % of revenue
144
0,4%
1 259
3,4%
(88,6%)
18
0,0%
1 047
1,5%
(98,3%)
The ES-SYSTEM Group increased its domestic shares as well as its portfolio of orders to be completed in coming
quarters. Management expects a recovery in sales in the second half of 2014.
According to our expectations, the second quarter of this year has brought a significant increase of nearly 20% y/y in
domestic sales, mainly on account of the recovery on the construction market, as well as the steadily growing demand for
products using LED technology. Based on the results achieved in the second quarter of this year and having analyzed our
current portfolio of orders, we are counting on an increase in sales in the third quarter of this year compared to the
corresponding period in the preceding year, concluded Bogusław Pilszczek, President of ES-SYSTEM.
In the second quarter of 2014, the ES-SYSTEM Group’s sales grew by 10% y/y, reaching 40.2 million PLN. The Group’s
profits have cumulatively increased by 5% y/y, achieving the amount of 74.1 million PLN. The margin percentage on sales
in general in 2014 was higher than in the first quarter of 2013, i.e. 37.6%, which is an increase by 1.6 p.p. y/y.
DOMESTIC SALES ACCELERATE
The second quarter of this year has brought on a considerable acceleration in domestic sales – an increase of over 20%
y/y, reaching nearly 34 million PLN. The domestic market denoted growth of 11.4% y/y, achieving 61.85 million PLN
cumulatively.
Several large investments were completed in the second quarter of this year:
• Galeria Marcredo shopping center in Kutno
• Eurocentrum office building complex in Warsaw
• Krakow Arena
• Teatr Szekspirowski in Gdańsk
• The Koszęcin Palace in Silesia
The growth in domestic sales in Q2 of this year is a result of the recovery in the architectural segment – a 26% increase
y/y – as well as of the completion of investments which had been delayed in 2013. During this period, the outdoor lighting
segment denoted a growth of 16% y/y thanks to sales relating to park lighting projects, mainly using LED technology. The
Company also finalized the prestigious Aarhus project in Denmark. Emergency lighting showed an increase in Q2 2014 as
well, reaching 37% y/y, which was made possible by the expansion of the product offer to include more cost-effective
products with an attractive design, technical parameters, which simultaneously fulfill the necessary norms. Sales in the
industry lighting sector has maintained the same level y/y. LED lighting sales denote a continued increase for yet another
quarter – in Q2 of this year, it made up 29% of sales compared to 13% in Q2 2013, and cumulatively, it accounted for
nearly 25% of sales compared to 13% in the first half of 2013.
www.essystem.pl
[email protected]
ES-SYSTEM S.A. z siedzibą w Krakowie, ul. Przemysłowa 2, 30-701 Kraków wpisaną przez Sąd Rejonowy dla Krakowa – Śródmieścia w Krakowie Wydział XI Gospodarczy KRS do Rejestru
Przedsiębiorców Krajowego Rejestru Sądowego pod numerem 0000113760, o numerze NIP 679-25-51-640 i numerze REGON 351610904, o kapitale akcyjnym 14.145.000, 21 zł (w całości
wpłaconym), o zarządzie w składzie: Prezes Zarządu – Bogusław Pilszczek, Wiceprezes Zarządu – Mikołaj Wierzbicki, Wiceprezes Zarządu – Mirosław Butryn
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THE SLOWDOWN ABROAD TO BE MADE UP FOR IN SUBSEQUENT QUARTERS
In the second quarter of 2014, the ES-SYSTEM Group made 6.2 million PLN in export sales, 26% less than in the second
quarter of 2013, which amounts to about 2 million PLN. This is primarily the effect of a high base of comparison (a large
shopping center project was completed in Hungary in Q3 2013) and the decrease in sales in the Eastern region. At the
same time, sales in Q2 2014 increased by about 3% compared to Q1 2014. Export sales amounted to 12.2 million PLN
cumulatively, which denotes a decrease of 19.7% y/y.
Selected completed export projects in Q2 2014:
• Stockholm University in Sweden
• North Hertfordshire College in London/Great Britain
• City Hall in Assen/the Netherlands
• Manner sweets factory in Austria – the first stage is complete, further 5 stages to be completed up till 2017
LED product sales increased in Q2 2014 by 71% y/y and reached 34% of export sales. In the first half of this year, this
increase came in at the 75% mark and the share of LED products sold was 31%.
POSITIVE PROFITS IN Q2, GROWTH PROSPECTS IN THE SECOND HALF OF 2014
The Group’s EBIT in Q2 of this year was positive and amounted to 29 000 PLN. Cumulatively, after the first half of 2014,
the company denoted a loss in the amount of -0.2 million PLN.
During this period, the company also recorded the one-time cost of participation in an industry fair in Frankfurt, as well as
costs relating to the Group’s reorganization (the joining of production plants in Wilkasy and Rzeszów: 0.9 million PLN and
0.2 million PLN respectively). The Group’s EBITDA in Q2 of this year amounted to 2.2 million PLN (a decrease by 30% y/y),
with an EBITDA margin of 5.5%. Cumulatively, the EBITDA achieved the value of 4 million PLN (a decrease by 15% y/y),
whereas the margin stood at 5.4%. The Group’s net profit in Q2 2014 was 144 000 PLN, and it cumulatively reached the
amount of 18 000 PLN.
At the end of June 2014, the ES-SYSTEM Group had a cash balance of 21.5 million PLN, i.e. a 28% increase y/y.
A REVIVAL ON THE MARKET, DEVELOPMENT PROSPECTS IN FUTURE QUARTERS OF 2014
The visible revival on the domestic lighting market this year has brought on an upturn in the industry. Management
expects further sales growth of architectural lighting fixtures, as well as emergency, industrial and outdoor lighting
systems with LED technology. By the end of 2014, the share of LED lighting in the total domestic turnover should manage
to exceed 25%.
Based on the results from the second quarter of 2014, the current volume of orders and planned sales, the
Management hopes to see an increase in sales results in Q3 2014 in comparison to the result achieved in Q3 2013,
as well as Q2 2014.
Additional information:
Anna Przyczyna
Administrative Office of ES-SYSTEM S.A.
Tel. +48 (12) 295 80 39
e-mail: [email protected]
ES-SYSTEM S.A. is the largest Polish company in the lighting sector in the section of professional lighting technology for constructions: general, architectural,
residential, industrial, specialist and exterior. The Company forms specialist Capital Group with its own three production plants. The Group determines direction
of the branch’s development in the areas of innovatory technological solutions, energy saving and design. For the last few years ES-SYSTEM has been
recording a double digit increase in income along with distinct improvement of profitability ratios at the same time. Development strategy of the Group assumes
strengthening the position of the national leader in the sector and dynamic increase in export sales on the EU market and other highly developed countries.
www.essystem.pl
[email protected]
ES-SYSTEM S.A. z siedzibą w Krakowie, ul. Przemysłowa 2, 30-701 Kraków wpisaną przez Sąd Rejonowy dla Krakowa – Śródmieścia w Krakowie Wydział XI Gospodarczy KRS do Rejestru
Przedsiębiorców Krajowego Rejestru Sądowego pod numerem 0000113760, o numerze NIP 679-25-51-640 i numerze REGON 351610904, o kapitale akcyjnym 14.145.000, 21 zł (w całości
wpłaconym), o zarządzie w składzie: Prezes Zarządu – Bogusław Pilszczek, Wiceprezes Zarządu – Mikołaj Wierzbicki, Wiceprezes Zarządu – Mirosław Butryn
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