Incap Reports 33% Revenue Growth for January-September 2017

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EMS firm Incap Group has reported total revenue of €37.1 million for January to September 2017, up by 32.8% compared to the same period last year. Operating profit amounted to €3.6 million, up by 11.5% year-on-year, and net profit totaled €2.6 million, up by 26.3% compared to the same period last year.

Incap’s revenue for January-September 2017 developed favorably both in India and in Estonia—increased production capacity in India and new customers’ ramp-ups in Estonia are the major reasons for revenue growth. The cost control programs to fight against increasing component prices are working well.

Higher revenue with decreased fixed costs is resulting in good profit performance. Earnings per share were €0.59. The operating profit margin stood at 9.8%, which can be considered as an excellent level for electronics manufacturing services business.

The strengthening of Indian Rupee had an increasing effect on the revenue by approximately €0.7 million and on the operating profit by €0.07 million on the corresponding period last year.

The financing position of the company remained good and the equity ratio on 30 September 2017 was 40.4%.

Outlook for 2017

Incap’s estimates for future business development are based both on its customers’ forecasts and on the company’s own assessments.

The company has detected a possible discrepancy in inventory valuation from 2016 and early 2017. There might be a need for a write-off of approximately €0.5 million from the inventory from this time period. In case a write-off is needed and taken in to the accounts for 2017, the Group’s operating profit (EBIT) for the full year 2017, including this extraordinary cost from the past, would be somewhat lower than in 2016.

The company continues to estimate that that the Group’s revenue in 2017 will be approximately €45-50 million and that the operating profit (EBIT) in 2017 is somewhat higher than in 2016, provided that there are no major changes in exchange rates and without the possible write-off of inventory value.

The Group’s revenue in 2016 was €38.6 million and the operating profit (EBIT) €4.4 million.

Incap will publish its financial statement release for January-December 2017 in accordance with IAS 34 on Tuesday, 13 February 2018.