The wholesale group’s revenue and results exceeded expected levels for the first half year of 2009. The initiated restructuring plan with focus on restructuring subsidiaries, cutting costs, and reducing debt is working.
Revenue of the Danish-owned Solar Group with subsidiaries in eight European countries was € 717.8m for the first half year, and EBITA (earnings before interest, tax and amortisation) was € 15.1m, corresponding to organic growth of -12.3%. Revenue for the second quarter was € 344.6m, and EBITA amounted to € 7.5m.
Despite revenue and results exceeding expectations, the development in the first half year shows that the economic crisis has had a significant impact on the activity levels in the industry and construction sectors.
Several of the group’s markets show signs of a certain stabilisation in sales to industry customers, whereas the decrease within electrical installation is expected to continue into the next half year. On the other hand, sales to hws (heating, water and sanitary) contractors, who make up one of the group’s new customer groups, is expected to develop in a positive direction.
Solar continuously reduces the workforce in order to adapt the group’s costs to the market situation in the individual markets. These reductions will, together with the initiatives completed in 2008, result in annual savings of approximately € 26m in total.
For 2009, Solar now expects revenue between € 1,365 and 1,430 m, and EBITA between € 30 and 38 m.
As a consequence of the recession, Solar has chosen to focus on fewer activities in the company programme New Solar 2010.
The Blue Energy concept, which puts focus on energy-efficient components and solutions that can counteract the consequences of the climate change, has been well-received by customers as well as suppliers. More than 30 of Solar’s strategic suppliers have chosen to become partners in the concept, and many contractors have chosen to focus on this growth area.
The big business development project Solar 8000 which focuses on group-standardised processes supported by a standard IT system (SAP) is on schedule, which is satisfactory. The total investment will amount to up to € 40m over the next three to four years.
For further comments, please contact Group CEO Flemming H. Tomdrup, phone number +45 76 30 42 00.
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