Phoenix Mecano on track despite headwinds - Seite 3

Sales in the Enclosure Systems division climbed by 13.7% from EUR 99.2 million to EUR 112.8 million. In organic, local-currency terms, the increase was 11.6%. The operating result rose from EUR 13.4 million to EUR 17.4 million and the operating margin from 13.5% to 15.4%.

The division benefited from the booming market for electronic enclosures as a result of increasing industrial digitalisation. With its exceptionally broad range of standard products available ex stock as well as customised solutions combining proven enclosure engineering with state-of-the-art input technology, the division was ideally placed to meet the unflagging demand. The procurement situation remained complex, especially for electronic components for projects involving industrial PCs with integrated printed circuit boards.

Irregularities at a US subsidiary

On 4 July 2022, Phoenix Mecano announced that an internal investigation had been opened into potential irregularities at a US subsidiary. The investigation is largely complete and revealed irregularities in the recognition of sales, material costs, receivables, liabilities and accruals/deferrals. The already known direct and indirect effects have been taken into account in the interim financial statements for the period ending 30 June 2022, impacting the operating result by USD 6.1 million (EUR 5.6 million). No further significant financial impacts are expected between now and the completion of the investigation. However, there will still be costs for restructuring measures. In total, the further impact on earnings should not exceed EUR 2 million.

Outlook

In recent months, macroeconomic conditions have deteriorated due to the war in Ukraine, partial lockdowns in China and rising inflation accompanied by interest rate hikes. The economic slowdown and the associated weakening of market demand are likely to continue in the second half of the year. The Phoenix Mecano Group is proving resilient in the face of these headwinds. As things stand, Phoenix Mecano's management and Board of Directors are confident of achieving the forecast growth in sales in financial year 2022, barring a major recession in H2. Excluding one-off items linked to the irregularities at a US subsidiary, this also applies to the announced double-digit percentage improvement in operating result (EBIT). The growth drivers aligned with megatrends – automation, digitalisation, demographic change and decarbonisation – remain unaffected.