29.07.2015

Mixed quarter for Bronto

Federal Signal, the owner of Bronto Skylift has published its half year results which highlight lower order intake and revenues, but with improved profitability.

Total revenues for the six months were $50.5 million almost 14 percent down on this time last year, however much of the decline is due to the exchange rate. Order intake during the period fell 19 percent in Euros, but the currency weakness meant that this translated to $60.9 million a drop of almost 34 percent. Last year’s operating loss of $1.1 million was converted into a $300,000 profit for this year.

Looking at the second quarter revenues declined 26 percent to $25.4 million, largely due to currency translation, although US and Asian sales were also slower. Order intake however increased 18 percent in local currency – Euros – driven by strong order intake in Europe, the Middle East and Pacific rim, offset by fewer orders in the USA. However when converted to dollars total order intake for the quarter came in four percent lower than last year at $38.9 million. And finally last year’s loss of $300,000 was converted to a break-even situation this year, thanks to higher margins driven by a better product mix and gains in manufacturing efficiencies.

The order book at the end of the period was $78.2 million, compared to $112 million at this point in 2014.

Vertikal Comment

These numbers are sadly dramatically skewed by the fall in the Euro and the rise in the dollar, although the company’s backlog of $78 million equates to around nine months lead time which is greater than it or its customers would like to see.

The slower sales in the US are interesting, but most likely temporary, the company has instituted a policy to hold firm in its pricing levels, and this is possibly having some impact, but mainly on the lower margin business, which is reflected in the improved profitability.

It will be very interesting to see how the third quarter develops.