SIEVI, FINLAND – Scanfil reported first quarter profits rose 54.5% to 1.1 million euros on an 8% increase in revenue. During the March quarter, the EMS company totaled sales 47.6 million euros on higher demand from the long-lagging telecom sector.

Operating profit rose 25% to 2.5 million euros.

The company took 200,000 euros in one-time expenses  related to its purchase of Schaltex GmbH, a German contract manufacturer. That acquisition closed on March 31, and is expected to be immediately accretive to sales and profits.

Scanfil estimates that the deal will increase 2014 sales 11 to 18% and operating profits by 11 to 15 million euros.

In a press release, CEO Petteri Jokitalo said, "The year started on a positive note. We were able to continue our profitable growth. Turnover was up by 8% and operating profit by 26% from the previous year. We have been particularly happy to see that sales to telecommunication customers increased during the first quarter after a long declining trend.

"Schaltex,  acquired at the end of March, will further accelerate our growth strategy by strengthening our market position in Germany and bringing us new major customers. We believe that Scanfil's processes and purchase operations are able to create added value for Schaltex's customer base. The customers will also benefit from having the manufacturing capacity of our Estonian, Finnish, Hungarian and Chinese factories at their disposal.”