Bufab reports H1 sales up 17%
30 September 2016
Bufab Group reported Quarter Two 2016 sales rising 15% to SEK 762 million, taking six months net sales up 17% to SEK 1.48 billion. Organic growth in the first half was 4%.
Operating profit for the half year increased to SEK 153 million from SEK 107 million, with the operating margin increasing to 10.3% from 8.4%. Bufab
says order intake for the half year was in–line with net sales but intake in Q2 was lower than net sales.
Gross margin in the second quarter was 29.3% (27.4% for the same quarter 2015). President and CEO Jörgen Rosengren credits the improvement as the result
of systematic effort but acknowledges a “favourable sourcing market” and contribution from acquired businesses.
International operations performed well with a net sales increase of 23% in the quarter. Declines in Norway and China were more than offset by growth
across Europe, with the acquisition of Apex Stainless Ltd in the United Kingdon contributing to improved operating margin.
Swedish sales grew 4% with some margin improvement — a combination of organic growth and recent acquisition.
Considering the outcome of the EU referendum Rosengren said Bufab generated around 10% of sales and 15% of operating profit in the United Kingdom.
Should the Pound and demand in the UK weaken for an extended period, it would have a negative effect on Bufab but the Group feels it can compensate
higher import costs with higher sales prices. Rosengren notes that, while there is uncertainty, Bufab has not seen any concrete effects of the
Brexit decision.
(SEK 100 approximately equal to €10.56 at interbank rate).
