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UPDATE 1-Belgium's Barco shares tumble after first-half warning
July 11, 2014 / 11:10 AM / 3 years ago

UPDATE 1-Belgium's Barco shares tumble after first-half warning

* Says new H1 orders down 8 pct, sales fall 17 pct

* Blames weakness in industrial & govt, LiveDots venture

* Shares down as much as 10 pct, hit lowest since May (Adds detail, background)

By Robert-Jan Bartunek

BRUSSELS, July 11 (Reuters) - Belgian digital screen maker Barco NV on Friday warned of a bigger-than-expected drop in first-half profit after new orders lagged the previous year’s levels, sending its shares down 10 percent.

The group said the decline was caused by a weak performance in its industrial and government division, which makes products such as video walls for surveillance centres, and its LiveDots venture, which makes screens for concerts and other events.

Barco, which had said in April it expected flat sales and slight growth in core profit for 2014 as a whole, said new orders in the first half through June were 8 percent below last year, with sales falling 17 percent.

Analyst Guy Sips at KBC Securities, who downgraded his recommendation on the stock to “hold” from “accumulate”, said there was likely to be disappointment in communications from the company, given it had previously said shrinking order intake in the first quarter was due to orders being postponed to the second three months.

“Today you can ask: Where are these orders?” Sips said.

Barco also said it may divest its aerospace and defence unit after some industrial companies expressed an interest in the division, which makes products such as screens for flight simulators.

The group said it was studying the offers and would make an announcement before the end of August.

Barco shares fell as much as 10.1 percent compared with a slight dip in the Belgian midcap Index. The stock traded as low as 53.03 euros, its lowest since early May.

The company will unveil first-half results on July 23. (Editing by Foo Yun Chee and David Holmes)

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