June 25, 2014 / 6:35 AM / in 3 years

UPDATE 2-European recovery, restructuring help lift Zumtobel's sales

(Refiled to remove extraneous text characters in headline)

* Year dividend 0.18 euros/share, vs 0.13 euros forecast

* Restructuring charges push company to 5 mln-euro net loss

* Shares down 0.4 percent

By Georgina Prodhan and Angelika Gruber

VIENNA, June 25 (Reuters) - Austrian lighting group Zumtobel’s fourth-quarter sales rose by a higher than expected 8 percent, it reported on Wednesday, thanks to strong growth in Asia, recovery in Europe and a fundamental restructuring.

Despite posting a net loss due to restructuring charges, Zumtobel also raised its dividend to 0.18 euros ($0.24) per share for the year ended April 30, up from 0.07 euros last time and ahead of the 0.13 euros average forecast given by analysts in a Reuters poll.

Charges of 36 million euros last year resulted in a full-year loss of 5 million euros and quarterly loss of 17 million euros as Zumtobel, like European rivals Osram and Philips, pushes through a restructuring as the industry shifts its technology to light emitting diodes (LEDs).

Chief Executive Ulrich Schumacher told Reuters he could not rule out further restructuring in the future but no more measures would be implemented in the current financial year beyond the 8 percent job cuts and six plant reviews already announced.

On top of shedding or downsizing plants, Zumtobel is merging its sales operations and changing the way it markets its brands, hoping the measure will boost sales as well as savings.

“No one can say what will happen next year ... For this year, all issues are addressed, there won’t be more,” Schumacher said. “In the next fiscal year it’s up to us. The more successfully we work, the less need there will be,” he added.

Shares in Zumtobel were down 0.4 percent at 15.69 euros by 1006 GMT in generally weak European markets.

“The company is well on track with its restructuring targets,” said Baader Bank analyst Guenther Hollfelder in a research note, adding that the company’s underlying performance in the fourth quarter was better than expected.

Zumtobel, whose business lines range from electronic components to large lighting installations, is grappling with a shift to more efficient, adaptable and profitable LED technologies, as are its rivals.

Germany’s Osram is cutting over 20 percent of its workforce and closing a quarter of its 43 factories.

LED lighting sales rose by 53 percent and accounted for a third of Zumtobel’s group sales in the year just ended, while total sales were flat as construction markets picked up only towards the end of the year.

Fourth-quarter sales rose to 321 million euros, but adjusted earnings before interest and tax (EBIT) fell 20 percent to 5 million euros due to the costs of a major biennial trade fair.

Large projects during the year included the Sochi winter Olympics, the Museo Jumex in Mexico City and the new Vienna business university campus.

Zumtobel said it aimed to lift its EBIT margin to between 5 and 6 percent this year from 4 percent last year on sales that should grow by about 3 percent.

Zumtobel makes the majority of its sales in Europe, where construction markets have begun to recover as the continent pulls out of recession.

In the United States, a large and mature market where it makes 3 percent of its sales, it is making losses and seeking a strategic partner.

Schumacher said Zumtobel had not yet found the right partner but was restructuring the business there and expected to reach break-even during the course of 2014/15. ($1 = 0.7355 euros) (Editing by David Holmes and Greg Mahlich)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below