3.2. Group earnings
| EUR million | Q2 2008 | | Q1 2009 | Q2 2009 |
| EBIT | +25.7 | | −19.2 | –41.5 |
| Net income | +17.1 | | −29.8 | –51.5 |
Earnings per share (in EUR, undiluted) | +0.26 | | −0.44 | –0.76 |
Group EBIT was minus EUR 41.5 million in Q2 2009.
Net income was minus EUR 51.5 million and was thus the major reason for the net cash flow of minus EUR 40 million. Earnings per share were minus EUR 0.76.
4. Headcount adjustments unavoidable
As the already very weak demand deteriorated further in Q2 2009, EPCOS also (like other companies) had to adjust its production capacity. To this end, short-time work in particular was initiated at the company’s locations in Germany. Headcount reductions too became unavoidable, and were effected almost exclusively at locations outside Germany.
In the quarter under review, the number of people who work for EPCOS worldwide was reduced by about 2,050 to 22,220. Temporary staff and the employees of subcontractors accounted for about three quarters of the staff reductions, while EPCOS’ own employees made up about one quarter. The number of own employees declined by 560 to 18,610.
5. First half of fiscal 2009
| EUR million | First half of 2008 | ± | First half of 2009 |
| Sales | 729 | −25% | 546 |
| EBIT | +54.1 | --- | −60.7 |
| Net income | +36.2 | --- | −81.4 |
Earnings per share (in EUR, undiluted) | +0.55 | --- | −1.20 |
Year on year, EPCOS’ sales declined 25 percent to EUR 546 million in the first half of fiscal 2009 (October 1, 2008, through March 31, 2009). Largely due to the lower business volume, EBIT was minus EUR 60.7 million.
Net income was down to minus EUR 81.4 million. Earnings per share dropped to minus EUR 1.20.
Net cash flow was minus EUR 104 million in the first half of fiscal 2009. A net loss of EUR 81 million and the decrease in trade liabilities due to the lower business volume were the main factors influencing cash used in operating activities of EUR 53 million. The decrease in trade receivables and depreciation/amortization of EUR 64 million were only able to compensate for part of this cash outflow. EUR 51 million was used in investing activities. This figure essentially comprised EUR 31 million for net additions to non-current assets and EUR 19 million for the acquisition of equity interests.
6. Outlook
In all the industries we serve there is still no sign of an end to the recession, which is affecting EPCOS primarily in Germany – and here especially in the automotive and industrial electronics industries. At the present time, it is therefore not possible to forecast when demand will return to normal levels. It is assumed that, by now, many customers have reduced their inventories of components to a minimum. This, at least, could lead to a moderate improvement in EPCOS’ sales in the second half of fiscal 2009.
Sequentially, EPCOS therefore expects slightly increasing sales of EUR 270 to 280 million and improved EBIT in Q3 2009.
About EPCOS
EPCOS AG is a leading manufacturer of electronic components, modules and systems headquartered in Munich. With its broad portfolio EPCOS offers a comprehensive range of products from a single source and focuses on fast-growing and technologically demanding markets, in particular in the areas of information and communication technology, automotive electronics, industrial electronics and consumer electronics. The EPCOS Group has design and manufacturing locations and sales offices in Europe, Asia, and in North and South America.
Electronic components are found in every electrical and electronic product and are indispensable for their flawless operation. Products from EPCOS store electrical energy, filter frequencies, and protect against overvoltage and overcurrent.
In fiscal 2008 (October 1, 2007, to September 30, 2008), EPCOS posted sales of EUR 1.48 billion. At the end of the fiscal year, the company employed about 21,200 people worldwide.
N.B. All financial data has been compiled to IFRS and is not audited.
This document may contain forward-looking statements with respect to EPCOS’ financial condition, results of operations, business, strategy and plans. In particular, statements using the words “expects”, “anticipates” and similar expressions, and statements with regard to management goals and objectives, expected or targeted revenue and expense data, or trends in results of operations or margins are forward looking in nature. Such statements are based on a number of assumptions that could ultimately prove inaccurate, and are subject to a number of risk factors, including changes in our customers’ industries, slower growth in significant markets, changes in our relationships with our principal shareholders, the ability to realize cost reductions and operating efficiencies without unduly disrupting business operations, currency fluctuations, unforeseen environmental obligations, and general economic and business conditions. EPCOS does not assume any obligation to update publicly any forward-looking statement, whether as a result of new information, future events or otherwise.
