Kitron Swings to Loss Despite Higher Volume PDF Print E-mail
Written by Mike Buetow   
Thursday, 13 February 2014 09:47

BILLINGSTAD, NORWAY -- Kitron today reported a fourth-quarter loss despite higher revenue due to product mix, restructuring costs and margin pressure. The EMS company said revenues rose 3% year-over-year to NOK 476.3 million ($78.1 million) for the December period.

EBIT fell 82% to NOK 24.4 million, and the net loss was NOK 4 million for the period, versus net income of NOK 27.9 million a year ago. Operating cash flow was NOK 51 million, down from NOK 84.8 million.

Profitability was hurt due to changed product mix and costs related to a change in strategy regarding Kitron's distribution center in Lithuania, the firm said. Kitron decided to kill the Lithuania project, which was costlier and more complex that originally assumed. Growth was seen in the defense and aerospace, and industrial markets, offset in part by slower sales to the energy, medical and marine markets.

Interim CEO Dag Songedal said,"All in all this was a weak quarter for us. Clearly, profitability must and will be improved. This will be on top of management's agenda in 2014. On the positive side, it should be noted that we have won important contracts in the fourth quarter."

Order backlogs fell NOK 128.9 million in the quarter to NOK 718.1 million. During the quarter, Kitron renewed agreements Maquet Critical and Husqvarna, and received its first orders from Cassidian Optronics. Kitron expects to make gains in the Swedish and German markets, which suggests growth for the factories in Sweden and Lithuania. Growth is also expected in China, whereas the development in the Norwegian market is more uncertain, the firm said.

For the year, Kitron ended up with NOK 1.63 billion ($267.3 million) in revenue, down 3.7%, and net income of NOK 8.33 million ($1.36 million), down 82%.

Ed.: 1 NOK = $0.163937

 

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