SON, THE NETHERLANDS -- Neways Electronics said third-quarter electronics manufacturing services continued to pick up as backlogs and profits were up. Profitability rose despite a 1.6% drop in sales from the third quarter of 2012, to EUR 68.4 million ($92.5 million).

Backlogs for the period ended Sept. 30 were EUR 72.5 million, up 4.3% from the June quarter.

"The generally positive trend in the EMS market seen in recent months, together with the closure and transfer of the activities of the operating company in Echt, contributed to a further optimization of the capacity utilization that began in the first half of the year," Neways said. "The imbalance in capacity utilization has largely been reduced at the majority of the Neways operating companies in recent months. The focus will now be on structurally raising the capacity utilization.

The company added that the Sept. 15 fire that closed its production facility in Neunkirchen, Germany, has led to the transfer of all programs to other Neways sites.
"Our focus is now on issues such as the availability of materials to execute contracts for clients. Neways is in constructive talks with the company insurers and can rule out any negative impact on the company's results."

Neways said the outlook has continued to improve, and the EMS firm expects to report an "excellent second half."

"We expect the net result (excluding exceptional income and expenses) in the second half to largely exceed the result recorded in the first half."