Interim report Jan-Sep: Positive operating profit and completing restructuring with impairment of a holding in Brazilian associated company

Third quarter

  · Order intake was 266.3 MSEK (309.0).
  · Net sales amounted to 271.1 MSEK (322.3).
  · Operating profit of 4.7 MSEK (12.0).
  · Profit/loss after tax was -72.7 MSEK (8.2) including 71.6 MSEK impairment of
participations in associated company charged to profits. Excluding this
impairment, profit/loss was -1.1 MSEK.
  · Earnings per share were -3.82 SEK (0.44).

Nine months

  · Order intake amounted to 811.4 MSEK (989.5).
  · Net sales of 834.9 MSEK (1,041.6).
  · Operating profit/loss -46.6 MSEK (62.9). Profit was charged with non
-recurring expenses of 50 MSEK (6.5).
  · Profit/loss after tax was -117.4 (36.3). Excluding non-recurring expenses
and impairment, profit was 4.2 MSEK.
  · Earnings per share were -6.14 SEK (1.91).

COMMENTS FROM PRESIDENT AND CEO PER SAMUELSSON

“Beijer Electronics is now entering the final phase of the realignment it
started at the beginning of the year. In the IAS business area, we have
implemented a flatter and more customer-oriented structure. We are reducing our
overheads as planned, which is having the intended effect on our earnings. Our
focus on product development has resulted in new launches, and more product
introductions will follow in 2017. Production has been rationalized, and half of
our production in the US will be transferred to our Taiwanese unit, with the
remainder put out to contract in the US.

As another element of this overhaul, the Board also decided to impair most, 71.6
MSEK, of the book value of our holding in Altus Sistemas of Brazil. This
impairment, which was charged to third-quarter profits, is being executed
against the background of the poor progress of the Brazilian economy and Altus’s
exposure to the oil and gas sector. These circumstances had a big impact on
Altus’s sales and profits. Accordingly, we regard its long-term value as
uncertain. The impairment has no effect on liquidity.

Accordingly, we have laid the foundation for clear improvements in 2017. We are
retaining our ambition to achieve the group’s long-term targets in 2018.

The trend of improving operating profit excluding restructuring expenses
continued in the period, compared to the three previous quarters. Although our
actuals of sales and profits were somewhat lower than expected, progress in the
third quarter is still in the right direction.

The IDC business area achieved a profit improvement in the quarter, with
profitability back at nearly 10%. The market for major projects, especially in
the process industry, is slow, as investments have been deferred. However, one
positive is IDC securing its first order on a major project, and a new customer
in the Train segment placing its first order. Korenix of Taiwan is continuing
its positive progress, with sales gains of over 10% in the quarter. In the
period, Westermo started up a new sales enterprise in Australia. Investments in
new technology were executed at Westermo’s production facility in Stora Sundby
to assure quality and expand capacity.

The IAS business area largely progressed as expected. As previously, its order
intake and sales were impacted by the discontinued partnership with Mitsubishi
Electric and disposals of our operations in Finland and the Baltics. Our program
of measures is having a good effect, with significantly lower overheads
resulting, and modest positive profit for the quarter. We expect restructuring
of our production in the US to further reduce our costs.

IAS launched its all-new product range, the X2 series, packaging soft and
hardware for all panels. We expect this to impact positively on sales in 2017.
We also previewed the business area’s new strategy for the Internet of Things
(IoT) called “The Fast Track to the Cloud,” which was well received, with
several solutions being launched progressively through 2017.

In the fourth quarter 2016, we expect group sales to be higher than in the
previous quarter. We also expect operating profit to be better than the
corresponding period of 2015 and the third quarter 2016.”


INVITATION TO CONFERENCE CALL

Today, October 20, 2016, a conference call will be held for press and analysts,
where President and CEO Per Samuelsson and CFO Joakim Laurén present the company
and comment on the report.

Time:  Thursday October 20, at 10.30 a.m. CET

To participate in the conference please dial:

From Sweden: +46856642695
From UK: +442030089806


To access the presentation please use this link:
http://www.anywhereconference.com?UserAudioMode=DATA&Name=&Conference=131677366&
P 
IN=57788820


The report and the presentation will be available at Beijer Electronics’ website
www.beijerelectronics.com/ir. A recording of the conference call will also be
available here after the event.

Welcome!

For more information please contact:

President and CEO, Per Samuelsson, tel +46 (0)40 35 86 10, mobile +46 (0)708 58
54 40
CFO Joakim Laurén, tel +46 (0)40 35 84 96, mobile +46 (0)703 35 84 96.


This information is such that Beijer Electronics AB (publ) is required to
disclose in accordance  with the Swedish Financial Instruments Trading Act
and/or the Swedish Securities Market Act. The information was submitted for
publication by Annika Johnsson at 08:00 CET, October 20, 2016.


Beijer Electronics is a fast growing technology company with extensive
experience of industrial automation and data communication. The company develops
and markets competitive products and solutions that focus on the user. Since its
start-up in 1981, Beijer Electronics has evolved into a multinational group with
sales of 1,375 MSEK 2015. The company is listed on the NASDAQ OMX Nordic
Stockholm Small Cap list under the ticker BELE. www.beijerelectronics.com