Press Release
BOARD APPROVES RESULTS FOR THE 1st QUARTER OF 2008
CEMBRE (a STAR listed company):
SALES GROW IN THE 1ST QUARTER OF 2008
- Domestic sales and exports grew respectively by 3.4% and 9%
- Profit margins were negatively affected by the revision of the amortization period of finished and semi-finished goods inventories
| Consolidated figures (€ ‘000) |
1st Qtr. 2008 | Sales margin. % | 1st Qtr. 2007 | Sales margin %. | var. |
| Sales | 25.609 | 100 | 24.022 | 100 | 6,6 |
| Gross operating profit | 5.488 | 21,4 | 5.692 | 23,7 | -3,6 |
| Operating profit | 4.785 | 18,7 | 4.935 | 20,5 | -3,0 |
| Pre-tax profit | 4.407 | 17,2 | 4.870 | 20,3 | -9,5 |
Brescia, May 15, 2008 – The Board of Directors of Cembre Spa, chaired by the Managing Director Giovanni Rosani, approved at today’s meeting the Consolidated Financial Statements at March 31, 2008.
In the 1st Quarter of 2008, consolidated revenues grew by 6.6% on the same period in 2007, from €24 million to €25.6 million.
Domestic sales for the 1st Quarter of 2008 amounted to €10.8 million, up 3.4%, while sales abroad
were equal to €14.8 million, up 9% on the 1st Quarter of 2007.
In the 1st Quarter of 2008, a total of 42% of sales were represented by Italy, 45.2% by the rest of
Europe and 12.8% by the rest of the world.
As a result of a survey carried out on the usage of plant and equipment, Cembre decided to revise
the amortization period of the same to bring it into line with the expected useful life of the assets.
The adjustment resulted in a €112 thousand reduction in the amortization expense for the quarter as
compared with the amortization expense resulting from the application of depreciation schedules
formerly in use. The longer useful life of plant and equipment resulting from the revision of
estimates, generated a reduction in the hourly cost of the same used in the valuation of finished and
semi-finished goods inventories and in the consequent reduction in the value of inventories of €734
thousand with respect to that assessed using former parameters. Profit margins were consequently
negatively affected by the revision of amortization schedules.
Consolidated gross operating profit declined by 3.6% from €5.7 million in the 1st Quarter of 2007 (representing a 23.7% margin on sales), to €5.5 million (a 21.4% margin on sales) in the 1st Quarter of 2008.
Gross operating profit was affected by the increase in the cost of raw materials and that of personnel, as the number of employees grew from 525 to 539 and the labor contract for the metal and mechanical sector was renewed, granting a number of wage increases.
Consolidated operating profit for the 1st Quarter of 2008 amounted to €4.8 million, representing an 18.7% margin on sales, down 3% on €4.9 million in the 1st Quarter of 2007 (when it represented a 20.5% margin on sales).
Consolidated pre-tax profit for the first three months of 2008 amounted to €4.4 million, representing a 17.2% margin on sales, down 9.5% on €4.9 million in the 1st Quarter of 2007 (a 20.3% margin on sales). The decline is partly due to the negative foreign-exchange performance which determined losses amounting to €313 thousand.
The consolidated net financial position of the Group declined from positive €1.3 million at March 31, 2007, to an indebtedness of €0.3 million at March 31, 2008, due primarily to the strong capital expenditure made in the second half of 2007. With respect to December 31, 2007, the consolidated net financial position improved by €1.4 million.
“In the 1st Quarter sales grew by 6.6% on the same period in 2007. Profit margins were negatively affected by the revision of depreciation schedules, in view of longer estimated useful lives of plant and equipment, that influenced the evaluation of finished and semi-finished goods inventories; these adjustments resulted in a reduction in hourly costs employed in the assessment of the value of inventories.” – declared Cembre’s Managing Director, Giovanni Rosani – “Net of the effect of the revision of useful lives, profit margins were in line with the 1st Quarter of 2007” concluded Rosani.
The manager responsible for preparing the Company’s financial reports, Claudio Bornati, declares, pursuant to paragraph 2 of Article 154 bis of the Consolidated Law on Finance, that the accounting information contained in this press release corresponds to the document results, books and accounting records.
Attachments: Financial Statements at March 31, 2008
The Quarterly Report at March 31, 2008 has not been audited.
In the present press release use is made of certain alternative performance indicators that are not envisaged in IFRS-EU accounting principles, and whose significance and content are illustrated below, in line with the CESR/05-178b recommendation published on November 3, 2005:
Gross operating profit (EBITDA): defined as the difference between sales revenues and costs for materials, of services received, and the net balance of operating income and charges. It represents the profit before depreciation, amortization and write-downs, cash flow from financial activities and taxes.
Operating profit (EBIT): defined as the difference between Gross operating profit and the value of depreciation, amortization and write-downs. It represents the profit achieved before financial activities and taxes.
Net financial position: represents the algebraic sum of cash and cash equivalents, financial receivables and current and non-current financial debt.
Cembre designs, manufactures and distributes electrical connectors and cable accessories. It enjoys
a leadership position in Italy and significant market shares in the rest of Europe. It is also the
world's largest producer of connector installation tools (mechanical, pneumatic and hydraulic) and
tools for cable shearing. The products it has developed for connection to the rail and for other
railway applications are used by major companies in the sector round the world.
Cembre owes its success to an insistence on innovative, high-quality products, a broad and thorough
collection, and an extensive distribution network both in Italy and abroad.
Established in Brescia in 1969, the Cembre Group is now a full-fledged international force. Along
with the parent company in Brescia it has seven subsidiaries: five trading companies (in Germany,
France, Spain, the United States and Norway) and two manufacturing and trading subsidiaries
(Cembre Ltd. in Birmingham, U.K. and General Marking S.r.l. in Bergamo), for a total workforce of
525 as of December 2007. Since 1992 its products have been certified by Lloyd's Register Quality
Assurance for the design and production of accessories for cables, electrical connectors and tools
for their installation.
Cembre has been listed on the Italian Stock Exchange since December 15, 1997, and on the STAR
section since September 24, 2001.
Contact:
Ferruccio Peroni (Peroni e Vitale comunicazione) f.peroni@peronievitale.it
For further information please contact Mr. Claudio Bornati
Cembre S.p.A. - Tel. +3903036921
