All time high in order backlog due to high level of order growth in all business areas - marked sales and earnings increase expected as of Q2 2010
In Q1 2010 sales of the Mühlbauer technology group were 22.8% lower yearonyear, at EUR 29.4 million (PY: EUR 38.1 million) due to the recessionrelated slump in the industry business and projectrelated order fluctuations in the government business of the previous months, while - taking into account a special effect from the discontinuation of liabilities of EUR 2.0 million in connection with the settlement of patent disputes - EBIT at EUR 1.8 million was, largely due to the lower level of sales and comparatively higher manufacturing costs, 23.4% lower than comparable value of the previous year (EUR 2.4 million), which was affected by a special effect from the formation of such obligations at a level of EUR 1.0 million. This corresponds to a virtually stable yearonyear EBIT margin of 6.2% (PY: 6.3%). Taking into consideration a slightly improved financial result of EUR +0.7 million (PY: EUR +0.5 million) and a tax income of EUR 0.2 million posted in the reporting period (against expenses of EUR 0.6 million for the same period of the previous year), the Group achieved net earnings for the period under review of EUR 2.1 million - against EUR 1.8 million yearonyear. At the same time, earnings per share rose to EUR 0.14 (PY: EUR 0.12).
In the first three months of the current financial year, at EUR +7.7 million (PY: EUR +2.7 million) cashflow from operating activities significantly exceeded the level for the same period of the previous year, due largely to cashflow of EUR 1.8 million from the disposal of shortterm securities. In the previous year this value was impacted by a balance of payments of EUR 3.4 million from the acquisition and the disposal of such securities. Taking into consideration the outflow from investment activities of EUR 4.6 million, which was markedly lower than in the previous year (PY: EUR 6.4 million) and the reduction of trade accounts receivable, the technology group achieved a free cashflow of EUR +1.3 million in the quarter under review, which is EUR 1.7 million higher yearonyear (PY: EUR-0.4 million). Shareholders' equity dropped slightly, from 77.9% to the end of the year to 77.4% to the end of the first quarter.
With a consolidated order income of EUR 113.9 million, Mühlbauer more than doubled the comparatively high value of the previous year (PY: EUR 52.2 million) and achieved growth of 118.2%. The company's core area Cards & TECURITY®, which benefited from a largescale order worth EUR 64.2 million, was the greatest contributor to order income and recorded an increase of 124.6% to EUR 91.2 million (PY: EUR 40.6 million). Moreover, order volumes in the business areas Semiconductor Related Products and Traceability doubled as a result of the increased investment activities on the respective markets. Thus, order income in Semiconductor Related Products climbed to EUR 15.2 million (PY: EUR 7.6 million) due to the greater demand for both semiconductor backend and Smart Label systems, while Traceability exceeded the value for the same period of the previous year by 112.5%, at EUR 1.7 million (PY: EUR 0.8 million). Even in Precision Parts & Systems, the gradually increasing propensity to invest and the measures for the reinforcement of sales activities introduced in the previous year have produced results leading to a significant increase of order income: yearonyear, order income rose by 81.3% to EUR 5.8 million (PY: EUR 3.2 million). To the end of the first quarter the order backlog of the globally active technology group totaled EUR 154.6 million (PY: EUR 94.7 million), which is 63.3% higher yearonyear.
Although the governmentrelated project business can naturally be subject to fluctuations and it cannot be fully excluded - irrespective of the recent recovery in industry business - that the observed positive development may not prove sustainable against the background of the latent risk of a permanent economic recovery, the technology group confirms its outlook for the whole of the year of bringing about a yearonyear sales and earnings increase, as a result of the considerable order growth and the continued positive trend in its core area Cards & TECURITY®.