Ronnie Leten comments on Atlas Copco’s Q2 results
July 17, 2009
Stockholm, Sweden, July 17, 2009: Global demand for Atlas Copco’s products remained on a low level in the second quarter, and the Group continued implementing restructuring measures to adapt capacity and costs and increase efficiency. Revenues and earnings fell from a year earlier. Profitability was in line with the first quarter and the cash flow was strong.
“We have achieved a strong result in light of the tough demand situation, and we will continue optimizing our manufacturing structure,” says Ronnie Leten, President and CEO of the Atlas Copco Group. “We expect demand to remain weak in most industries and regions and stay around the current level in the near term.”
Revenues in the second quarter fell 14% to MSEK 16 155, an organic decline of 27%. Organic order intake dropped 37%. Operating profit was MSEK 2 066, corresponding to a margin of 12.8%. Adjusted for restructuring costs, the margin was 14.4%. The operating cash flow increased to MSEK 2 492 (396), supported by reduced inventory customer receivables levels.
During the quarter, the number of employees was reduced by about 1 600, giving a total reduction of the workforce since September 2008 of 5 440, which will save more than MSEK 2 000 annually.
“While the Group is undertaking many efforts to reduce costs, we always have the long-term view in mind,” Ronnie Leten says. “We are continuing to invest in product development, services and in market presence. The future of Atlas Copco depends on our ability to continue to deliver excellent service and improve the productivity and energy efficiency for our customers. The introduction of the Carbon Zero compressors at the end of the second quarter demonstrates our strength in this area.”
On June 30, Atlas Copco introduced Carbon Zero, a range of compressors which have been certified by the German TÜV institute as being able to recover 100% of the electrical input power for heating water.
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