KAUPPALEHTI, FINLAND -- PKC Group, a Finnish ODM and EMS firm, reported operating profits were up 20% to 5.4 million euros on an 8% hike in net sales, to 43.6 million euros, for the September quarter. By business unit, sales of wiring harness rose 11.4% to 33.8 million euros, while electronics fell 2% to 9.9 million euros. The company just finished expanding in Russia and will build a factory in China next year.

Through the first three quarters new sales increased 15.7% over a year ago to 146.7 million euros. Sales were boosted by demand for heavy vehicles in Europe and North America, while volumes and sales of telecom and electronics fell slightly.

Year to date, the operating profit was 19.4 million euros, up from 14.5 million euros, while the pre-tax profit was 20.1 million euros, up from 14.2 million euros.

The operating profit of the electronics group rose 7.4% to 2.2 million euros despite a 4.3% drop in net sales to 29.3 million euros. Net sales fell due to a downtrend in prices. The company will transfer production from its factory in Raahe, Finland, to a lower-cost site in Kostomuksha, Russia, and has laid off 180 workers from its Raahe factory.

In a statement, the company said it expects the Finnish electronics contract manufacturing market to remain at present levels, while its electronics business's net sales may drop slightly versus a year ago.

The company expanded the Kostomuksha factory by 9,400 sq. m. during the quarter. PKC now operates factories in Finland, Russia, Estonia and Brazil. PKC will invest about 3 million euros to build a subsidiary in China, with production scheduled to start during 2006.

At quarter’s end, PKC employed 3,592, workers, up from 2,916 last year.

Mika Kari was promoted to president and chief executive, from vice president. Jarmo Rajala was promoted to director of the electronics business unit and managing director of PKC Electronics Oy. Rajala was director of sales and marketing of Cybelius Software Oy.

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