SHARE
FINCANTIERI: FIRST HALF YEAR OPERATING RESULTS POSITIVE DESPITE MARKET CRISIS
29 set 2010
29 set 2010
• New orders amounting to € 1,492 million (compared to € 398 million in the first half 2009) reflect a slight recovery in the cruise sector although the situation of the ferry sector remains negative;
• At € 9.9 billion the order book, albeit ensuring a substantial work load, does not saturate the production capacity of the Group’s shipyards, with consequent recourse to temporary staff lay-offs (i.e. Cassa Integrazione Guadagni) both for this year and in the years to follow;
• EBITDA, at € 56 million, shows a significant contribution from the Group’s US companies (EBITDA of € 17 million);
• Result of ordinary operations is positive by € 3 million pre non-recurring and extraordinary expenses.
* * *
Trieste, 29 September 2010 – The Board of Directors of Fincantieri met today to review the Group’s results for the first half 2010 which, despite the crisis in the market, shows a positive result before non-recurring and extraordinary expenses, of € 3 million.
The order intake for the first six months amounts at € 1,492 million, up from € 398 million in the first half 2009. This increase reflects a slight recovery in the market following the crisis in the demand for new buildings, although it is still much less than the record figures of previous years, whilst the ferry sector is still negative. In further detail, Fincantieri S.p.A. acquired orders for two prototype 141,000-ton cruise ships for Princess Cruise Line (Carnival Group) at very competitive price and, in the naval field, for two stealth vessels (Falaj 2 class) to be built for the United Arab Emirates. In addition, the US subsidiaries acquired an order for an oceanographic ship for the Government agency NOAA (National Oceanic and Atmospheric Administration) as well as a further 39 small RB-M patrol vessels (Response Boats-Medium) for the US Coast Guard.
On June 30th 2010, Fincantieri Group had a € 9.9 billion order book. The resulting backlog, equal to € 6.7 billion, although substantial, is insufficient to fully saturate the production capacity of the shipyards. Hence the Group has planned, for the current and following years, the recourse to temporary staff lay-offs (i.e. Cassa Integrazione Guadagni) in a number of Italian production facilities which will experience a partial workload shortage.
The Group’s economic trend has been impacted by the crisis, in particular:
- Revenues: the sum of operating revenues and other revenues and income, amount to € 1,408 million, down 10.7% on the first six months of 2009 due to a fall in production volumes; however, the cost of materials, services and other items is lower (from 78.6% in the first half of 2009 to 76.1% for 2010) thanks to the Company’s increasingly effective cost cutting policies; noteworthy is the contribution from the US companies which came to € 106 million in the first six months of 2010 (€ 112 million for the previous period);
- EBITDA amounts to € 56 million, slightly lower than the first half of 2009 (€ 58 million); there is a significant contribution from the US companies amounting to € 17 million (€ 16 million in the same period 2009);
- EBIT amounts to € 22 million, also slightly lower than the first half of 2009 (€ 24 million) with a substantial contribution from the US companies of € 14 million (€ 13 million in 2009);
- Operating result before extraordinary and non-recurring expenses: positive, at € 3 million, albeit considerably lower than the first half of 2009.
Points to note are:
- the Company, to a greater extent than in the previous year, had to face shortages of workload in a number of production facilities, especially in the merchant sector, with recourse to temporary lay-offs;
- the two recently acquired Princess orders are still being evaluated with regard to some economic aspects and their impact on the Company accounts will be duly considered in the annual Financial Statement.
For the remainder of 2010 the Group will increasingly feel the impact of both the drop in the workload and the price pressure on new orders. Hence, as in the previous year, 2010 might have to face further ”non-recurring” costs which will be defined according to developments in market prospects in the forthcoming months and the results of on-going cost reduction initiatives. These expenses will be taken into consideration in the year end Financial Statement.
The Net Financial Position is positive at € 211 million (compared to a negative balance on 31 December 2009 of € 151 million). This is due to a substantial reduction in working capital mainly as a result of a decrease in work in progress related to a greater flow of deliveries compared to new keel laying, at year end the Net Financial Position is expected to be lower as cash inflows will be lower than outflows.
• At € 9.9 billion the order book, albeit ensuring a substantial work load, does not saturate the production capacity of the Group’s shipyards, with consequent recourse to temporary staff lay-offs (i.e. Cassa Integrazione Guadagni) both for this year and in the years to follow;
• EBITDA, at € 56 million, shows a significant contribution from the Group’s US companies (EBITDA of € 17 million);
• Result of ordinary operations is positive by € 3 million pre non-recurring and extraordinary expenses.
* * *
Trieste, 29 September 2010 – The Board of Directors of Fincantieri met today to review the Group’s results for the first half 2010 which, despite the crisis in the market, shows a positive result before non-recurring and extraordinary expenses, of € 3 million.
The order intake for the first six months amounts at € 1,492 million, up from € 398 million in the first half 2009. This increase reflects a slight recovery in the market following the crisis in the demand for new buildings, although it is still much less than the record figures of previous years, whilst the ferry sector is still negative. In further detail, Fincantieri S.p.A. acquired orders for two prototype 141,000-ton cruise ships for Princess Cruise Line (Carnival Group) at very competitive price and, in the naval field, for two stealth vessels (Falaj 2 class) to be built for the United Arab Emirates. In addition, the US subsidiaries acquired an order for an oceanographic ship for the Government agency NOAA (National Oceanic and Atmospheric Administration) as well as a further 39 small RB-M patrol vessels (Response Boats-Medium) for the US Coast Guard.
On June 30th 2010, Fincantieri Group had a € 9.9 billion order book. The resulting backlog, equal to € 6.7 billion, although substantial, is insufficient to fully saturate the production capacity of the shipyards. Hence the Group has planned, for the current and following years, the recourse to temporary staff lay-offs (i.e. Cassa Integrazione Guadagni) in a number of Italian production facilities which will experience a partial workload shortage.
The Group’s economic trend has been impacted by the crisis, in particular:
- Revenues: the sum of operating revenues and other revenues and income, amount to € 1,408 million, down 10.7% on the first six months of 2009 due to a fall in production volumes; however, the cost of materials, services and other items is lower (from 78.6% in the first half of 2009 to 76.1% for 2010) thanks to the Company’s increasingly effective cost cutting policies; noteworthy is the contribution from the US companies which came to € 106 million in the first six months of 2010 (€ 112 million for the previous period);
- EBITDA amounts to € 56 million, slightly lower than the first half of 2009 (€ 58 million); there is a significant contribution from the US companies amounting to € 17 million (€ 16 million in the same period 2009);
- EBIT amounts to € 22 million, also slightly lower than the first half of 2009 (€ 24 million) with a substantial contribution from the US companies of € 14 million (€ 13 million in 2009);
- Operating result before extraordinary and non-recurring expenses: positive, at € 3 million, albeit considerably lower than the first half of 2009.
Points to note are:
- the Company, to a greater extent than in the previous year, had to face shortages of workload in a number of production facilities, especially in the merchant sector, with recourse to temporary lay-offs;
- the two recently acquired Princess orders are still being evaluated with regard to some economic aspects and their impact on the Company accounts will be duly considered in the annual Financial Statement.
For the remainder of 2010 the Group will increasingly feel the impact of both the drop in the workload and the price pressure on new orders. Hence, as in the previous year, 2010 might have to face further ”non-recurring” costs which will be defined according to developments in market prospects in the forthcoming months and the results of on-going cost reduction initiatives. These expenses will be taken into consideration in the year end Financial Statement.
The Net Financial Position is positive at € 211 million (compared to a negative balance on 31 December 2009 of € 151 million). This is due to a substantial reduction in working capital mainly as a result of a decrease in work in progress related to a greater flow of deliveries compared to new keel laying, at year end the Net Financial Position is expected to be lower as cash inflows will be lower than outflows.