Johnson Electric Reports Business and Unaudited Financial Information for the First Quarter of Financial Year 2018/19

July 11, 2018 - 10:26
Johnson Electric Reports Business and Unaudited Financial Information for the First Quarter of Financial Year 2018/19

HONG KONG,CHINA - Media OutReach - 11 July 2018 - This news release is made by Johnson Electric Holdings Limited ("JohnsonElectric" or the "Company") for the business operations and selected unauditedfinancial information of the Company and its subsidiaries (the "Group") for thequarter ended 30 June 2018.


The Board of Directors of the Company considers thepublication of quarterly performance updates to be consistent withinternational corporate disclosure best practice. The objective of this newsrelease is to provide transparency and to ensure that investors and potentialinvestors receive equal access to the same information at the same time.


TheGroup's sales for the quarter ended 30 June 2018 were US$872 million comparedto US$753 million for the same quarter in 2017; an increase of 16%. Excludingcurrency movements and the one month effect of the acquisition of HallaStackpole, which became an 80% owned subsidiary in May 2017, sales increased by10% to US$826 million.


Foreignexchange rate movements had a positive effect of US$34 million on the Group'ssales during the quarter. This was due to the impact of the stronger Euro,Chinese Renminbi and Canadian Dollar against the US Dollar, comparing averageexchange rates for the quarter ended 30 June 2018 to the same quarter lastyear. The acquisition of Halla Stackpole increased sales by US$12 million. On apro-forma basis, excluding currency movements, Halla Stackpole grew byapproximately 12% compared to the same quarter last year.


Automotive Products Group ("APG")

APG'ssales, as reported grew by US$109 million or 19%. APG's sales excludingcurrency effects and the one month acquisition effect of Halla Stackpoleincreased by US$66 million or 12%, with the following sales changes by region:


  • Asia increased 25%
  • Europe increased 2%
  • Americas increased 10%


APG'sorganic sales growth was largely driven by an increase in demand for productsfor thermal cooling, engine and transmission oil pumps, lighting and seatadjust applications and powder metal components.


Industry Products Group ("IPG")

IPG's sales, excluding currencyeffects, increased by US$7 million or 4% compared to the same quarter lastyear. Sales changes by region were:


  • Asia increased 7%
  • Europe flat
  • Americas increased 4%


IPG'ssales growth was mainly driven by new business wins, increased share and theramp-up of programs in Asia. In Europe, sales were flat. In the Americas,strong revenue growth was driven by volume growth in the white goods and ventilationsegments.


Chairman'sComments on First Quarter's Sales Performance and Outlook

Concerningthe first quarter's sales performance, the Chairman and Chief Executive, Dr.Patrick Shui-Chung Wang, said, "JohnsonElectric is continuing to experience robust demand for its motion products andtechnology solutions which is driving very healthy sales growth.  At present, the main operational challengesfor the business are higher raw material and labour costs that are running atlevels well ahead of the prior year."


Dr. Wang further commented: "Lookingfurther ahead, we remain concerned about the risk that the trade disputebetween the US, China and European Union will ultimately have a negative impacton global economic growth.   Our current analysis of Section 301 tariffs ongoods imported into the USA from China, covering those already implemented andthose recently announced but not yet implemented, indicates that these tariffswill apply to Johnson Electric product lines that amount to less than 5 percent of the Group's total annual sales.  While this estimated direct sales exposure toSection 301 tariffs is not large in the context of the Group's highlydiversified global sales base, it remains difficult to assess what impact afurther ratchetting up in tit-for-tat tariffs could have on customer demand,buying behaviour and on Johnson Electric's component input costs over themedium to longer term."


Cautionary Statement

Shareholders and potential investorsin the Company are reminded that the information provided in this news release,including information related to the expected outlook for the full year, isbased on the Group's unaudited internal records and management accounts. Thisinformation has not been reviewed or audited by the Company's auditors.


Shareholders and potential investorsshould exercise caution when dealing or investing in the shares of the Company.


About Johnson ElectricGroup


TheJohnson Electric Group is a global leader in electric motors, actuators, motionsubsystems and related electro-mechanical components. It serves a broad rangeof industries including Automotive, Smart Metering, Medical Devices, BusinessEquipment, Home Automation, Ventilation, White Goods, Power Tools, and Lawn& Garden Equipment. The Group is headquartered in Hong Kong and employsover 40,000 individuals in more than 20 countries worldwide.  Johnson Electric Holdings Limited is listedon The Stock Exchange of Hong Kong Limited (Stock Code: 179). For furtherinformation, please visit: