Johnson Electric has unveiled half year Group sales down 5% to US$1.02bn, while gross profit margin decreased to 27.6% from 30.2%.
The Automotive Products Group which contributed more than two-thirds of total sales, increased sales by 5% on a constant currency basis compared to the first half of the prior year.
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The division continued to perform well, added Johnson Electric, overall with particularly encouraging underlying performances achieved in the Engine & Transmission, Powertrain Cooling and Actuation Systems business units.
However, the significant market presence these businesses enjoy in Europe means their reported sales were negatively affected by the weak euro compared to the US dollar.
During the second quarter of the financial year, APG’s sales to Asian based customers also showed signs of softening as the slowdown in China’s economy and other developing economies began to impact automotive sales volumes.
“Johnson Electric recorded somewhat weaker financial results for the six month period ended 30th September 2015 against a backdrop of adverse foreign currency movements and a weakening global economic environment,” said chairman and chief executive, Patrick Wang.
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By GlobalData“In the face of such difficult conditions, Johnson Electric remains focused on those parts of the business where management has a reasonable degree of influence. First, this means directing our energies to serving customers whose products are aligned to the key underlying trends that will drive long-term consumer demand, including the imperatives to reduce emissions, lower fuel consumption, improve health and safety, and increase mobility and controllability.
“Second, it requires a relentless effort to improve efficiency and continue to eliminate waste from our operations. Third, we are aggressively expanding a global operating footprint that provides greater customer responsiveness and reduced exposure to foreign currency volatility or single country risk.
“And lastly, it means continuing to invest in building a team of people who are committed to making our customers successful and to growing a world-class company that can share in that success.”
