Interim / Quarterly Report • Feb 25, 2010
Interim / Quarterly Report
Open in ViewerOpens in native device viewer
=============================
Fiscal Half Year July 01 – December 31, 2009
Content
During first six months of fiscal year 2009/10, the turnover of 15.6 million EUR was – due to the recession - 28 pc. below the figure of previous year of 21.7 million EUR. The profit before interest and tax dropped to 105 thousand EUR (prev. year 1.2 million EUR). Therefore, the cautious expectations for the current business year made in management report 2008/09 was more than justified.
The company only works on own capital. Having a capital quota of 83 % at a balance volume of 20.7 million EUR, the company possesses sufficient own capital and thus is in a position to even survive without problems and without shortage in cash a longer period of recession as well as make use of possible acquisitions due to its financial stability. At present, there is neither limited nor granted capital nor a returnof-share program.
The number of shares is 2.954.943 pcs at a nominal value of 1 EUR.
Management and board at the annual shareholders' meeting of December 17, 2009 again finalised a dividend of EUR 0.30 per share.
The signed capital is exclusively common stock drawn to bondholders and entitled to vote. There are neither restrictions in the right to vote nor the purchase. The AK Industriebeteiligungen GmbH, Norderfriedrichskog possesses 10% of the company's capital since 25.02.2003.
Appointment and dismissal of the board is in accordance with legal regulations (§§ 84, 85 AktG). Changes as to articles of the association, especially dismissal of the supervisory board requires a majority of board votes of 75%. The compensation of the supervisory board breaks down to a fixum, a variable and a share-based part. As per 13.12.2007, the general shareholders board decided, that the required statements in the financial report can be omitted as per § 285 Nr. 9a Satz 5-9 HGB and/or § 314 Absatz 1 Nr. 6 Satz 5-9 HGB.
When controlling based on a take-over offer, it is agreed that the suppliers' contracts essential for the company may be cancelled by the latter; especially when there is a risk that a competitor will take over. At present, there are no reimbursement agreements made by the board in such case.
FORTEC's focus is on distribution of standard components. Due to vast and always available information via internet, there will be a reduction of the margins in industrial business in the long run. FORTEC's goal is to compensate this development by own self-added value.
By connecting the product segments of power supplies, display technology (industrial displays incl. controls) and embedded computer technology (single-board computer) to create an Embedded Solution System, FORTEC possesses for a long time now a very attractive rare domain.
Marketing starts with delivery of system-proved and tested standard kits, accompanied by customers' service in hard- and software at the purchase of standard units and ends in customer specific developments.
Target customers are mainly manufacturers in the field of industrial automation, medicine technology as well as providers of security instruments and equipment.
Our big competence is to provide technology know-how in combination with sales at site. Years of business relations to some thousand customers are the basis of our success. Our core countries namely Germany, Austria and Switzerland still offer considerable potential although already reached leadership in some market segments. Moreover, we are represented in the Benelux by a 25% participation in an electronic company and since 01st January 2009 we possess a majority of shares in a Czech production company.
Our strategy is to continuously achieve over-proportional profits of market segments in a long-term still considerably growing market. The basis of our steady successful expansion politics - also in the past – is: secured profitability.
Risks that could endanger the company at present are not reported.
Balance risks, if any, at balance day have been considered by corresponding accruals. The company has taken care of all possibilities to deal with any possible risks.
Elementary risks are covered by considerable insurances and are thoroughly checked every year; in special cases it may not be sufficient.
Potential risks which have to be taken into consideration to exist within the market are the risks for distribution, products and marketing as well as the dependency from suppliers.
Another enormous risk - yet not to be underestimated - is the system-related risk of the close co-operation with only few strategic partners in the same product portfolio. Already a change in personnel could lead to the loss of an existent and successful business co-operation and this mainly in view of suppliers in the Far East with whom there are often relationships for many years and of personal matter.
A considerable risk is forecast of stock. Wrong planning could result in considerable losses because there is a continuous trend to local suppliers. The risk to have unsellable merchandise on stock, is not only the result of false forecast, but also depends on the different quality standards set by customers and producers. Mainly, the important fact is that of the configuration of the merchandise with origin Far East as well as the political EU requirements as to its contents and its usage.
The product liability is an increasing risk which is controlled and noted by choice of suppliers and their valuations/ratings. However, having different quality standards, frauds and/or criminal actions of suppliers, we - as importer/supplier - are liable towards our customers.
A yet steady growing risk is the customer's requirements as to a prolonged time of warranty and the usual terms of a suppliers' contract. During these past years, the customers started to develop a certain aggressiveness for claims which is obviously against and at expenses of the supplier. Claims resulting from a supplier's contract may accelerate considerably the delivered value of the product. The result are more and more legal proceedings including corresponding risk.
Another main topic of the risk management is the often bad payment behaviour of some middle-sized companies. Here, examination of solvency as well as current debtors is made, yet observing mainly the requirements of the goods' insurance company. In view of the consequences of the financial crises, we are to expect considerable problems.
Our success also strongly depends on the vast, detailed and years of experience of our personnel. A big change in staff yet especially of key-persons would definitely endanger our current success.
A big question would endanger our business model as importer of technical highquality products i.e. the change in customers' behaviour to no longer produce in Middle Europe and turn to suppliers at site. In the future, the same effect would be a changed behaviour of our suppliers to sell directly to industrial customers and not any more through their common distribution channels. Another negative aspect could be a concentration process expected from the supplier's side which could result – in worst case – to a contract cancellation towards the supplier. In addition, similar effects could arise if the costs decrease because of the reduction of margins due to the competitor's information available to all customers via internet. This basically influences as well the personnel costs common in the German speaking region.
Due to the EDP – networking of the entire group, a break-down or a serious interference in the computer system could cause enormous damage to the company. A misuse by externals or internals, especially theft of information, business interruptions or IT – system breakouts or insufficient means for data security could endanger the company to an extreme extent.
Because of monthly statements, it is possible to recognize in-time differences in the forecast of order income, bookings, stock as well as turnover, margins and costs and thus take immediate action. Due to the abrupt economic decrease in industry in the course of the economic and financial crisis, the setback at the sales market took place more intensively and faster than costs could be decreased. In spite of counteractions, there will be temporary segment losses in various fields in BY 2009/10 until economy recovers again or the costs will be adjusted to reduced turnover.
Foreign currency risks are excluded, if possible, in case of larger project by invoicing directly in the relevant currency. However, there could be negative impulses on our company in normal business especially due to a further change of the dollar parity.
The existing growth strategy of the group does not only involve organic increase but also company acquisitions. Here, the figure above the net asset value is balanced as goodwill and checked year by year as to the recoverability. If the expectations of the purchased company are not met and/or – as a consequence of the economic unstableness – the expected cash-flow result cannot be achieved, then depreciations in the group's balance as per IFRS have to be done. In spite of the economic setback and the carefully made income planning for the next two to three years, a need for depreciation may not be eliminated if economic recovery fails.
During first half year of current business year, we ought to have reached the bottom of the cycle.
For second half year however, we expect – at the best – a recovery but not yet an upswing.
| As ts se A. No t a ts n- cu rre n ss e |
€ 3 1. 1 2. 2 0 0 9 |
€ 3 0. 0 6. 2 0 0 9 |
Eq i ty d L ia b i l i t ies u a n |
€ 3 1. 1 2. 2 0 0 9 |
€ 3 0. 0 6. 2 0 0 9 |
||
|---|---|---|---|---|---|---|---|
| A. S ha ho l de ' Eq i ty re rs u |
|||||||
| I. | Go dw i l l o |
2. 3 3 5. 4 5 9 |
2. 3 3 5. 4 5 9 |
I. | Su bs i be d c i ta l cr ap |
2. 9 5 4. 9 4 3 |
2. 9 5 4. 9 4 3 |
| I I. |
In i b le ta ts ng as se |
1 7 4. 7 8 9 |
1 8. 9 7 7 7 |
I I. |
Ca i l re ta p se rve |
8. 6 8 9. 3 6 4 |
8. 6 8 9. 3 6 4 |
| I I I. |
Ta i b le ts ng as se |
1. 3 4 6. 1 5 7 |
1. 3 3 0. 5 1 9 |
I I I. |
O he t r r es er ve s |
6. 9 9 0 5. 5 5 |
4. 8 0 8 0 7 5. |
| I V. |
F ina ia l a ts nc ss e |
9 5 3. 2 3 3 |
9 5 3. 2 3 3 |
||||
| V. | Lo l ia b i l i ies -te t ng rm |
9. 1 8 2 |
9. 1 8 2 |
I V. |
Ne inc t om e |
0. 6 9 5 5 |
1. 6 8. 3 9 3 5 |
| 4. 8 1 8. 8 2 0 |
4. 8 0 7. 1 9 1 |
1 7. 2 5 1. 8 6 6 |
1 8. 0 8 7. 7 8 0 |
||||
| B. Lo |
-te l ia b i l i t ies ng rm |
||||||
| Cu B. |
t a ts rre n ss e |
I. | O t he is ion r p rov s |
5 6. 1 6 0 |
5 6. 1 6 0 |
||
| I I. |
De fe d tax rre es |
2 0 1. 7 3 2 |
2 0 9. 8 6 9 |
||||
| I. | Inv ies to en r |
3 4 9 6 7. 5. 7 |
3 2 4 1 6 7. 7. |
2 8 9 2 5 7. |
2 6 6. 0 2 9 |
||
| I I. |
Ac ts iva b les co un re ce |
2. 1 2 7. 8 5 5 |
3. 8 7 1. 7 0 7 |
||||
| I I I. |
Ta iva b les x r ec e |
3 7 2. 0 7 6 |
2 9 3. 1 0 3 |
C. S ho |
l ia b i l i ies t- te t r rm |
||
| I V. |
O t he ts r a ss e |
2 6 2 4 5. 4 |
2 0. 6 2 6 4 |
||||
| V. | Ca h o ha d, ba k ba lan s n n n ce s |
5. 7 8 9. 7 6 1 |
5. 1 4 6. 2 2 5 |
I I. |
Tr de b les a p ay a |
1. 1 6 0. 8 9 9 |
1. 3 7 6. 9 7 0 |
| 1 8 8 1. 1 1 2 5. |
1 6. 8 9. 0 6 7 7 |
I I I. |
Ac ls he t tax cr ua o r es |
3 8 1 8 0 5. |
4 4 3. 8 6 2 |
||
| I V. |
O he is ion t r p rov s |
9 8. 6 9 8 5 |
1 4. 4 3 5 5 |
||||
| V. | O he l ia b i l i ies /a ls t t r cc ru a |
1. 0 4 3 9 5. 7 |
9 9 0 8 3 7. |
||||
| 3. 1 9 0. 1 4 7 |
3. 3 3 2. 4 9 5 |
||||||
| To l As ta ts se |
2 0. 6 9 9. 9 3 2 |
2 1. 6 8 6. 2 6 7 |
To l ta |
Eq i d ia b i l i ies ty L t a n u |
2 0. 6 9 9. 9 3 2 |
2 1. 6 8 6. 2 6 7 |
| Income Statement | FY 2009/10 | FY 2008/09 |
|---|---|---|
| Sales revenues | 15.577.797 € | 21.720.728 € |
| Other operating income | 251.513 € | 472.274 € |
| Cost of material | 11.435.920 € | 15.877.293 € |
| Expenses personnel | 2.480.103 € | 2.931.969 € |
| Depreciation | 131.322 € | 150.237 € |
| Other operating expenses | 1.676.029 € | 2.018.510 € |
| Operating income (EBIT) | 105.936 € | 1.214.993 € |
| Other interests and similar income | 27.242 € | 59.955 € |
| Taxes on income and profit | 82.609 € | 419.729 € |
| Net income | 50.569 € | 855.219 € |
| Earnings per share/1st Half Year | 0,02 € | 0.29 € |
| Shares outstanding | 2.954.943 | 2.954.943 |
| Income Statement | Q2 (1.10.-31.12.09) | Q2 (1.10.-31.12.08) |
|---|---|---|
| Sales revenues | 8.041.386 € | 10.457.268 € |
| Other operating income | 105.556 € | 272.673 € |
| Cost of material | 5.943.758 € | 7.466.006 € |
| Personnel expenses | 1.180.077 € | 1.494.990 € |
| Depreciation | 65.957 € | 85.936 € |
| Other operating expenses | 881.453 € | 1.146.587 € |
| Operating income (EBIT) | 75.697 € | 536.422 € |
| Other interests and similar income | 588 € | 17.946 € |
| Taxes on income and profit | 46.953 € | 204.489 € |
| Net income | 29.332 € | 349.879 € |
| Earnings per share/2nd Quarter | 0,01 € | 0.12 € |
| Shares outstanding | 2.954.943 | 2.954.943 |
| I. Operative Business | FY 2009/10 | GJ 2008/09 |
|---|---|---|
| Net income | € 50.569 |
€ 855.219 |
| Depreciation of tangible and intangible assets | € 131.322 |
€ 150.237 |
| Increase of inventories | € - 18.380 |
€ - 2.246.002 |
| Reduction of accounts receivables | € 1.743.852 | € 892.011 |
| Change of liabilities | € - 234.576 | € - 888.094 |
| Change of short-term accruals | € 84.155 |
€ - 218.902 |
| Change of other assets | € - 4.998 ------------------ |
€ 135.076 ------------------- |
| Cash-flow from operative business | € 1.751.944 | € - 1.320.455 |
| II. Investment Activities | ||
| Investments of finance/tangible and intangible assets |
€ - 221.925 | € - 294.029 |
| Earnings from assets | € 0 |
€ 7.219 |
| Cash-flow from investment activities | ----------------- € - 221.925 |
-------------------- € - 286.810 |
| III. Finance Activities | ||
| Profit earned /paid | € - 886.483 | € - 886.483 |
| VI. Cash-flow in total | € 643.536 |
€ -2.493.748 |
| V. Change in Liquid Funds | ||
| Cash at beginning of period | € 5.146.225 | € 4.831.168 |
| Cash at end of period | € 5.789.761 | € 2.337.420 |
| Capital stock Eur |
Capital Reserves Eur |
Development of reserves and accumulated profit Eur |
TOTAL Eur |
|
|---|---|---|---|---|
| Balance 01.07.2009 | 2.954.943 | 8.689.364 | 6.443.473 | 18.087.780 |
| Payout dividends | -886.483 | -886.483 | ||
| Net earning | 50.569 | 50.569 | ||
| Balance 31.12.2009 | 2.954.943 | 8.689.364 | 5.607.559 | 17.251.866 |
| Not transferable | ||||
| according to § 150 AktG | 8.689.364 | |||
| according to § 47 AktG | 2.954.943 |
| Capital stock Eur |
Capital Reserves Eur |
Development of reserves and accumulated profit Eur |
TOTAL Eur |
|
|---|---|---|---|---|
| Balance 01.07.2008 | 2.954.943 | 8.689.364 | 5.802.462 | 17.446.769 |
| Change of stated value from market earnings of financial assets |
-339.724 | -339.724 | ||
| Deferred taxes accummulated on company capital | 101.917 | 101.917 | ||
| Payout dividends | -886.483 | -886.483 | ||
| Net earning | 855.219 | 855.219 | ||
| Balance 31.12.2008 | 2.954.943 | 8.689.364 | 5.533.391 | 17.177.698 |
| Not transferable according to § 150 AktG according to § 47 AktG |
2.954.943 | 8.689.364 |
The balancing and evaluation methods of fiscal year 2008/09 according to IAS/IFRS remain unchanged. The number of full-time employees reduced to 112 (prev. year 116). The group 's business comprises data visualization and power supplies.
| Segment Report | data visualization (in TEur) |
power supplies (in TEur) |
|
|---|---|---|---|
| Turnover | 6.380 | 9.198 | |
| Profit (EBIT) | ./. 157 | 263 | |
| Financial Result | 17 | 10 | |
| Income Tax | 0 | 83 | |
| Net Income | ./. 140 | 190 |
Nach bestem Wissen versichere ich, dass gemäß den anzuwendenden Rechnungslegungsgrundsätzen für die Zwischenberichterstattung der Konzern-Zwischenabschluss der FORTEC Elektronik AG zum 31. Dezember 2009 ein den tatsächlichen Verhältnissen entsprechendes Bild der Vermögens-, Finanz- und Ertragslage des Konzerns vermittelt und im Konzern-Zwischenlagebericht der Geschäftsverlauf einschließlich des Geschäftsergebnisses und die Lage des Konzerns so dargestellt sind, dass ein den tatsächlichen Verhältnissen entsprechendes Bild vermittelt wird, sowie die wesentlichen Chancen und Risiken der voraussichtlichen Entwicklung des Konzerns im verbleibenden Geschäftsjahr beschrieben sind.
Landsberg, February 25th, 2010
Der Vorstand
Building tools?
Free accounts include 100 API calls/year for testing.
Have a question? We'll get back to you promptly.