Five subsequent quarters dominated by export
09 August 2013
The LUG S.A. Capital Group revenues as at the end of the first half of 2013: PLN 45.96m. The 5.32-per cent increase is due to export which rose by 15.49 per cent only in the second quarter of 2013. However, lower domestic revenues have had an impact on the operating result, slowing down the net profit increase rate.
After the end of another accounting period, LUG’s business remains dominated by export. The second quarter of 2013 is the fifth quarter in a row when the manufacturer of professional luminaires achieved export increase above 10 per cent (15.49 per cent). Unfortunately, low macroeconomic indicators in Poland and the economic dip severely affect domestic sales. After completion of large investments in infrastructure, the company experienced a significant slowdown in April and May which, as demonstrated by reduced dynamics in the construction and assembly, had a particularly strong impact on the construction sector. Domestic sales revenue dropped by 20.18 per cent only in the second quarter.
The operating profit in the second quarter of 2013 was PLN 296.56 thousand, while the accumulated result for two quarters was PLN 956.05 thousand. EBIT including amortisation in April, May and June was PLN 1,036.61 thousand, while EBITDA within 6 months amounted to PLN 2,475.27 thousand. The net profit in the second quarter was PLN 229.56 thousand, while the net profit in the first half of 2013 amounted to PLN 556.40 thousand.
| - In April and May, we experienced a marked slowdown which was reflected in our results. However, improved data on industrial production have had a positive impact on the illumination sector in Poland. Also, LUG has been consolidating its position in the foreign markets. Our decision regarding geographical diversification and predictions about development of particular economies were right, says Ryszard Wtorkowski, President of LUG S.A. Management Board. |
The LUG S.A. Capital Group increased its development potential based on export in the second quarter of 2013 by focusing on business organic growth. Most importantly, the office, warehouse and production facility was extended by additional 700 square metres in order to start new production line for LED components. At present, the investment is at the final stage and will be delivered in August 2013.
| - The investment into development of our facility and operations in the foreign markets were considerable burdens on our business in the first half of the year, but these will pay off in the subsequent months. Our activities will not only consolidate our position in the future, but will also improve our competitive advantage and contribute to further dynamic growth, says Ryszard Wtorkowski. |
Furthermore, in the second quarter of 2013 the Management Board of LUG S.A. made an important decision on extending the capital group by a new subsidiary that will boost sales on the British and Irish markets. The additional stimulus for generating demand for luminaires on the Polish market is the award of CNBOP certificates for they key groups of luminaires in July 2013.
The economic tendencies in the first half of 2013 are disappointing, but economy is now bouncing back and the improvement in industrial production in June gives grounds to anticipate better conditions in the third and fourth quarters of 2013. The above in conjunction with export development, in-depth cost control and the portfolio of orders for the subsequent quarters allows the Management Board of LUG S.A. to accept the present consolidated financial forecast.