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Saurer sales revenue declines in the first half of 2019

Saurer Group reported that sales revenue decreased by 17.5% to RMB 3 816 million. Also, profit before tax dropped by 32.6% to RMB 381 million, says a recent press release.

Sales 2019 revenue declines

Clement Woon, CEO, Saurer says, “The first six months of the year proved challenging for the group as we are seeing the delayed impact of the uncertainty resulting from the ongoing trade disputes. Investors are reluctant to invest and since business in our core markets, including China, India and Turkey, are reliant on financing, these factors have had a strong impact on Saurer. Global growth has also slowed down this year.”

Another factor that influences the textile industry, in particular, is ITMA. Being the world’s principal textile exhibition, this event has a profound effect on the market as customers delay orders in anticipation of the new products that manufacturers will launch at the exhibition, he added.

“At ITMA 2019, Saurer introduced a number of innovations, including its first air-spinning machine. With the addition of a draw frame to its pre-spinning line, the company is moving another step closer to becoming a complete solutions provider for the textile industry. Also supporting this aim is its new extensive range of laboratory equipment,” Woon says.

He also added, “While we received a very positive response at the exhibition, we cannot be complacent in the current environment. We will work diligently to ensure that Saurer is positioned optimally once the global market returns to previous levels.”

Key financial data

in RMB 000 HY 2018 HY 2019 Change YoY
Sales revenue 4 627 086       3 815 659 -17.5%
Profit before tax 564 386             380 518 -32.6%
Margin 12.20% 9.97% -2.23 ppt
Net profit/(loss) 409 822             352 138 -14.1%
Attributable to equity holders in the company 363 066 277 942 -23.4%
Cash and cash equivalents at the end of the period 575 913         1 139 408

 

97.8%
Weighted average return on equity 15.22% 5.86%  -9.36 ppt
Basic EPS (in yuan/share) 0.1915           0.1466 -23.4%
Diluted EPS (in yuan/share) 0.1915           0.1466 -23.4%
Weighted average number of shares 1 895 412 995 1 895 412 995

Balance sheet

in RMB 000 31 December 2018 30 June 2019
Total current assets 10 526 291             8 636 472
Total non-current assets 3 889 415              3 981 194
Total assets 14 415 706           12 617 666
Total current liabilities 5 315 587            5 055 915
Total non-current liabilities 3 112 344             1 530 076
Total liabilities 8 427 931             6 585 991
Total equity attributable to equity holders of the company 4 653 156             4 743 973

 

Total equity 5 987 775              6 031 675
Total liabilities and equity 14 415 706            12 617 666

Segment overview

in RMB 000 HY 2018 HY 2019 Change YoY
Saurer Spinning Solutions 3 674 867 3 285 098 -10.6%
Saurer Technologies 952 178 530 432 -44.3%

Saurer Technologies experienced a significant decline of 44.3% in the first half of the year. Reasons for this include the exceptional boom in demand for glass fiber, carpet yarn and tire cord in 2017 and 2018 – the resulting saturation in the market has negatively influenced Saurer’s twisting business in 2019. Sales declined by 10.6% for the Spinning Solutions segment.

Regional overview

in RMB 000 HY 2018 HY 2019 Change YoY
China 2 434 095       2 171 964 -10.8%
India 351 790         283 470 -19.4%
Turkey 424 865         112 910 -73.4%
Asia (excl. China/India) 692 197         795 516 14.9%
Americas 352 056         236 202 -32.9%
Europe/Africa/others (excl. Turkey) 372 083         215 597 -42.1%

 

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