Altdorf, Switzerland – Datwyler Group has reported growth in both sales and operating profit (EBIT) in the first half of 2019, amid slowing demand in the automotive sector.
In the six months to end of June, sales rose 1.8% year-on-year to CHF706 million (€650 million), while operating profit grew 0.5% to CHF91.2 million, Datwyler announced in its financial report 13 Aug.
The result were achieved "in what is a difficult environment", said CEO Dirk Lambrecht, referring to a decline in demand within automotive markets.
The trade dispute between the US and China, according to Datwyler, led to a reduction in inventories, particularly in the automotive sector, and a decline in demand.
The company’s Sealing Solutions division continued to develop positively, helped by strong sales of health care components.
The division’s revenue increased 5.8% to CHF 479.3 million, while operating profit remained flat at CHF83.7 million.
Here, Datwyler noted that the significant decline in automotive revenue as well as other start-up costs were offset by a double-digit growth in demand for care components from the company’s First Line production.
Prices for raw materials remained largely unchanged compared to the previous year.
The group’s Technical Components division posted a 5.4% decline in revenue at CHF227 million, while profitability rose 8.6% to CHF7.5 million.
Datwyler expects some challenges in the market to continue in the near future.
“In the automotive market, for example, there is no real prospect of things picking up over the next few months,” said the company release.
In addition, the Datwyler said it anticipated a significant decline in demand with regards to the online distribution of its electronic components.
Despite the challenges, the Swiss group expects its market position, ongoing efficiency-improvement programmes and its low-cyclical products to help it “cope with the challenges the future will bring.”
“Datwyler should achieve revenue growth for the full year, provided that the market and currency environments don’t continue to weaken,” the group concluded.