SKÅNES FAGERHULT, Sweden--(BUSINESS WIRE)--Regulatory News:
Concentric AB (STO:COIC):
First six months of 2015: Solid results strengthened by currency gains
· Net sales for the first six months, excluding Alfdex: MSEK 1,243 (1,023) – down 2% year-on-year, after adjusting for currency (+19%) and acquisition of GKN Pumps (+4%)
· Operating income for first six months: MSEK 205 (161), including income of MSEK 15 (nil) arising from negative goodwill and one-off expenses  of MSEK 14, both associated with the acquisition of GKN Pumps – underlying operating margin of 16.4% (15.8)
· Earnings after tax for first six months: MSEK 151 (113) – basic EPS of SEK 3.55 (2.59)
· Group’s net debt at end of Q2: MSEK 455 (440) – gearing ratio of 49% (56), following dividend payout of MSEK 127 (121) and own share buy-backs of MSEK 42 (50) in Q2
Second quarter of 2015: Strong margin despite weakened market demand
· Net sales for Q2, excluding Alfdex: MSEK 620 (527) – down 5% year-on-year, after adjusting for currency (+18%) and acquisition of GKN Pumps (+5%)
· Operating income for Q2: MSEK 88 (84), including one-off expenses  of MSEK 14 associated with the acquisition of GKN Pumps – underlying operating margin of 16.5% (16.0)
· Earnings after tax for Q2: MSEK 62 (60) – basic EPS of SEK 1.45 (1.39)
· Strong cash flow from operating activities for Q2: MSEK 114 (94)
 One-off expenses associated with the acquisition of GKN Pumps comprised legal and advisory deal costs of MSEK 2, the Chivilcoy redundancy programme totalling MSEK 11 and other integration costs of MSEK 1.
President and CEO, David Woolley, comments on interim report for Q2 2015:
“The group’s performance in the first six months of 2015 was strengthened by significant translational currency gains derived from the relative weakness of the Swedish Krona. Underlying sales for the second quarter of 2015, excluding the impact of currency and the GKN Pumps acquisition, were down 5% year-on-year as a result of softening demand for agricultural machinery, construction equipment and light trucks in North America. This has particularly affected our hydraulic product range but, similar to previous downturns, the group’s flexibility has ensured that the underlying EBIT margin actually improved to 16.5% for the second quarter.
In the first quarter, the group recognised MSEK 15 of income arising from negative goodwill as the fair value of net assets acquired with GKN Pumps exceeded the purchase price. We recently announced restructuring plans for our Chivilcoy facility and, as expected, we recognised MSEK 14 of one-off expenses in the second quarter.
Looking forward, the orders received, and expected to be fulfilled during the third quarter of 2015, were below the sales levels of the second quarter of 2015. Taking into account the fewer working days, we estimate that third quarter sales will be lower on a sequential quarterly basis, assuming constant currency. Despite these additional market headwinds in North America, Concentric remains well positioned, both financially and operationally, to fully leverage our market opportunities.”
Concentric AB (publ) is listed on NASDAQ OMX Stockholm, Mid Cap. The information in this report is of the type that Concentric is required to disclose under the Swedish Securities Market Act. The information was submitted for publication at 8.00am on 24 July, 2015. This report contains forward-looking information in the form of statements concerning the outlook for Concentric’s operations. This information is based on the current expectations of Concentric’s management, as well as estimates and forecasts. The actual future outcome could vary significantly compared with the information provided in this report, which is forward-looking, due to such considerations as changed conditions concerning the economy, market and competition.
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