11/5/2020

Interim financial report Q3 2020: GPV raises its guidance for 2020

Danish company GPV, a European top-10 electronics manufacturer delivers a significant top- and bottom-line growth in Q3 2020. This leads to an upwards revision of the overall expectations for the year.

The largest electronics manufacturer in Denmark, GPV – owned by Danish industrial conglomerate Schouw & Co. – has experienced growing demand in selected customer segments in Q3 2020. Revenue grew to DKK 836 million in Q3, which is an increase of 13 percent compared to the same period last year where GPV realised a revenue of DKK 741 million. In the same period, earnings (EBITDA) increased by 50 percent – from DKK 56 million in Q3 last year to DKK 84 million this year:

- As stated in our Q2 reporting three months ago, we made it well through H1 despite the global coronavirus pandemic. However, we did not expect Q3 to turn out as well as it has. We have experienced both increasing and decreasing demand within our different customer segments but overall, we have managed to lift revenue by 13 percent and earnings by 50 percent. Given the circumstances, we are satisfied with the results, CEO Bo Lybaek explains from GPV’s headquarters in Vejle, Denmark.

The recent growth is particularly due to a three-figure million order from a ventilator manufacturer. Most of the order was delivered and invoiced in Q3 which has had a significant impact on both the top- and bottom-line:

- Skills, dedicated work as well as a bit of luck have been factors in getting and delivering the order relatively fast. It is an order, however, which is a result of the coronavirus crisis and an unusual demand for ventilators. Therefore, we do not expect similar orders in the future, says Bo Lybaek and continues:

- From my perspective, we got the order due to our good reputation with the customer and in the industry where we excel in high-mix/low-medium volume production. In other words, we are more agile than the largest companies in the industry while at the same time having greater capacity than the small or medium-sized companies who are not able to lift an order of this size so quickly. I would like to take this opportunity to thank our global organisation who has managed to take care of each other during the coronavirus crisis while at the same time keeping our production and supporting functions running. This makes me very proud and it is proof of our strong and well-established culture across different countries and continents.

Bo Lybaek adds that GPV’s four main market segments have developed very differently in 2020. MedTech is growing, while the Transport segment has been declining. Here, GPV is delivering to the construction equipment industry which has been affected by a drop in demand. In the Instruments & Industry segment, which is the biggest segment for GPV, some of the customers are doing well while others are struggling. The same goes for the Cleantech segment in which some of the customers are hesitant to invest while others are growing rapidly due to the global climate movement.

GPV continues to look forward
Both management and employees at GPV agree to continue to look forward and adapt to the situation along the way. The second wave of the coronavirus pandemic is now affecting Europe and several other places around the world, and it is still uncertain how the global situation will evolve.

GPV has rolled out a global competition among its sites in Denmark, Switzerland, Austria, Slovakia, Germany, Thailand, Sri Lanka, China and Mexico to identify projects that can boost automation and productivity in the organisation. A total of 31 project proposals were handed in, and 19 of them will soon be implemented at various GPV sites. GPV is also further upgrading its digital facilities for site visits to support sales with online customer visits and thereby enhancing the possibilities for new product introduction and online audits despite the restrictions on physical meetings and travel activities:

- It is still essential for us to shake hands with our customers in key situations, and limited possibilities for physical meetings can potentially slow down our company’s development. We want to fight this: We need to make the best of a challenging situation and offer a better online experience than our competitors. We are all subject to the same conditions and therefore, we must continue to be the most agile and best at service excellence in our field, concludes Bo Lybaek.

Following the strong performance in Q3, GPV raises its guidance for the 2020 full year. Revenue is now expected to be at the same level as 2019 which was DKK 2.8-2.9 billion against the previous guidance of DKK 2.7 billion. Earnings (EBITDA) are expected to be within the DKK 230-250 million range against the previous guidance of DKK 200-230 million. Looking ahead to 2021, GPV expects to realise revenue and earnings in H1 2021 at the same level as H1 2020.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bo Lybæk, CEO

I would like to take this opportunity to thank our global organisation who has managed to take care of each other during the coronavirus crisis while at the same time keeping our production and supporting functions running. This makes me very proud and it is proof of our strong and well-established culture across different countries and continents.