Year-end Profitability Forecast Raised
Pfeiffer Vacuum, a leading manufacturer of high quality vacuum pumps, vacuum gauges, mass spectrometers and complete vacuum systems, announces its results for the 1st half of 2004.
Demand for high-tech products from Pfeiffer Vacuum continued unabated during the second quarter of 2004. At 1.04, the book-to-bill ratio – the ratio between new orders and sales revenues – was again positive during the first half of the year. New orders were received from all markets and regions.
Sales in Germany advanced by 31 percent, from € 17.9 million for the 1st half of 2003 to € 23.4 million for the reporting period. Larger orders included turbopumps for glass coating systems, for manufacturers of DVD systems and for analytical equipment manufacturers. In the other countries of Europe, sales rose only moderately from € 23.1 million to € 24.9 million. Significant sales were generated with automotive suppliers, for example, who received various leak detection systems air conditioning lines or expansion valves. Further customers included major European research facilities as well as medical technology manufacturers.
In the United States, sales in U.S. dollars rose by a strong 25 percent from $ 16.3 million to $ 20.4 million. Consolidated in euros, however, the sales growth amounted to only 12 percent due to the significantly weaker dollar by comparison with the year before. Sales in the United States came first and foremost from the semiconductor industry, although demand from the analytical market surged as well. Sales in Asia and the rest of the world were up 23 percent, from € 11.0 million in the 1st half of 2003 to € 13.6 million in the 1st half of 2004. The company’s most important customers here come from the analytical industry, the semiconductor sector and the coating industry.
Accounting for 40 percent of total sales revenues, Pfeiffer Vacuum’s most important product continues to be the turbopump. Sales of this product class rose from € 24.7 million in the 1st half of 2003 to € 31.2 million in the 1st half of 2004. Vacuum measurement and control equipment accounts for a constant, approximately 26-percent share of total sales. Sales revenues for service declined – as is typically the case in times of growing demand for new products. The percentage of total sales revenues accounted for by service business declined from 19 to just under 16 percent. Backing pumps continue to account for around 11 percent. The percentage of total sales revenues accounted for by complete vacuum systems – which also include leak detection systems as well as coating and DVD systems – increased moderately from 6 percent to 7 percent.
Strict cost control in all areas, higher sales revenues and a balanced product mix led to a disproportionate, 175-percent rise in operating profit, from € 4.7 million to € 13.0 million. 6 percent of sales revenues went to research and development, and thus to the future viability of the company. With a return on sales of 18.4 percent before taxes and 10.9 percent after taxes, the company is highly profitable and debt-free as well.
Chief Executive Officer Wolfgang Dondorf had this to say about the outlook: “For several months now, we’ve been experiencing a sharp rise in demand from all regions and markets. Positive signals came in July from Semicon West in San Francisco, the world’s premier semiconductor tradeshow. The Turbopumps 2301 and 1201 that we debuted there, along with the XtraDry, an entirely new dry backing pump, garnered keen interest.
Negotiations with major manufacturers of analytical equipment on framework agreements are nearing conclusion, which will enable us to further expand our position in this market segment over the medium term. In contrast to the general trend of pessimism that prevails in Germany, we currently see no reason for negative forecasts. Given our sales revenues to date, our order backlog and our current order negotiations, we are confident of seeing double-digit sales revenue growth in our core business of vacuum pumps, vacuum gauges, mass spectrometers and complete vacuum systems for the full 2004 fiscal year and of being able to increase our EBIT margin disproportionately to at least 16 percent.”
Except for historical information contained herein, the statements made in this release constitute forward looking statements that involve certain risks and uncertainties. Certain factors may cause actual results to differ materially from those contained in the forward looking statements, including those risks from time to time in the Company’s filings with the U.S. Securities and Exchange Comission, including its Form 6 K for the first six months 2003 ended June 30, 2004.
Source: Pfeiffer Vacuum GmbH