Johnson Electric reports Business and Unaudited Financial Information for the First Quarter of Financial Year 2020/21

July 14, 2020 - 10:11
Johnson Electric reports Business and Unaudited Financial Information for the First Quarter of Financial Year 2020/21

HONG KONG,CHINA - Media OutReach - 14 July2020 - This news release is made by Johnson Electric Holdings Limited ("JohnsonElectric" or the "Company" and together with its subsidiaries, the "Group") forthe business operations and selected unaudited financial information of theCompany for the quarter ended 30 June 2020.

 

The Boardof Directors (the "Board") of the Company considers the publication of quarterlysales performance updates to be consistent with international corporatedisclosure best practice. The objective of this news release is to providetransparency and to ensure that investors and potential investors receive equalaccess to the same information at the same time.

 

The Group'ssales for the quarter ended 30 June 2020 were US$517 million compared to US$767million for the same quarter in 2019, a decrease of 33%. Excluding currencymovements, sales decreased by 31% to US$527 million. Sales were significantlyreduced in April and May due to the impact of the COVID-19 pandemic,particularly on the automotive components industry in Europe and the Americas.During the month of June, the Group experienced a significant recovery indemand and by the end of the month sales volumes were approaching similarlevels to a year earlier.


Foreignexchange rate movements had a negative effect of US$10 million on the Group'ssales during the quarter. This was mainly due to the impact of the weakeraverage exchange rates for the Chinese Renminbi and Euro against the US Dollar,comparing the quarter ended 30 June 2020 to the same quarter last year.


Sales of AutomotiveProducts Group ("APG")


Sales ofour Automotive Products Group in the first quarter of the financial yeardecreased by US$249 million or 41% compared to the same quarter in 2019.  Excluding currency effects, APG's salesdecreased by US$240 million or 39%, with the following sales changes by region:


  • Asiadecreased 2%

  • Europedecreased 58%

  • Americasdecreased 60%

 

APG's salesin Asia decreased slightly. The impact of reduced volumes of light vehicleproduction was partially offset by growth in some segments in China includingbraking, closure, thermal management and transmission as well as oil pumps forengine and transmission.


APG's salesin Europe and the Americas decreased markedly as automotive customers in theseregions shutdown assembly plants in April and May to contain the COVID-19pandemic. Johnson Electric was also affected by these containment measures,necessitating the temporary closure of several of our production facilities inthe affected regions.


Sales of IndustryProducts Group ("IPG")


IPG's saleswere flat compared to the same quarter in 2019. Currency effects werenegligible. The sales changes by region, excluding currency effects, were asfollows:

 

  • Asiaincreased 2%

  • Europedecreased 2%

  • Americasincreased 1%


AlthoughIPG's sales of products for some segments and customers decreased due to theimpact of the COVID-19 pandemic on end-market demand, this was offset by stronggrowth in the medical devices segment due to new product launches and ramp-ups;higher-than-usual demand for home appliances and personal care products asconsumers spent more time at home due to COVID-19 lockdowns; and market sharegains as a result of supply disruptions at some competitors.

 

Chairman's Comments on Year-to-DateSales Performance and Outlook


Concerningthe first quarter's sales performance, the Chairman and Chief Executive, Dr.Patrick Shui-Chung Wang, said, "As previously projected, the unprecedentedeffects of the COVID-19 global pandemic resulted in sales levels in the firstquarter of the current financial year being substantially weaker than in thesame period a year ago.  Although demandin China displayed a gradual and consistent improvement during the quarter, itwas not until June that we began to experience a significant rebound in ordersfrom our automotive customers in North America and Europe."


Dr. Wangfurther commented: "Given the widespread and continuing uncertainties of thepandemic, it is not feasible to provide a meaningful estimate of sales volumesfor the rest of the year.  However, withthe most recent weekly sales run-rate approaching the levels of a year ago,there are no indications that underlying demand for Johnson Electric'sinnovative products and technology has been permanently reduced.  Our Industry Products Group performed verysatisfactorily in the first quarter with growing demand in some applicationsegments offsetting the negative impact of macro-economic contraction inothers. And in the automotive components sector, I am especially encouraged byan increase in new orders for Johnson Electric's products that improve fueleconomy, reduce emissions, and enable electrification -- which togetherrepresent the most critical technology imperatives of the industry for at leastthe next decade.


Despite thechallenging and unpredictable trading conditions, the Company remains in soundshape in terms of liquidity.  Geographically, Johnson Electric's sales aredivided broadly equally between Asia, Europe and the Americas and thisdiversified base of end-market demand continues to be a key source of strengthand stability for the Group. "

 

CautionaryStatement


Shareholdersand potential investors in the Company are reminded that the informationprovided in this news release, including information related to the expectedoutlook for the full year, is based on the Group's unaudited internal recordsand management accounts. This information has not been reviewed or audited bythe Company's auditors.


Shareholdersand potential investors should exercise caution when dealing or investing inthe shares of the Company.

About Johnson Electric Group

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 employs over30,000 individuals in more than 23 countries worldwide. Johnson ElectricHoldings Limited is listed on The Stock Exchange of Hong Kong Limited (StockCode: 179). For further information, please visit: www.johnsonelectric.com.

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