LEM share falls significantly: customer reluctance leads to postponement of medium-term goals | 11/11/24

The French-speaking Swiss electronic components manufacturer is now postponing its medium-term goals by two years.

According to a statement on Monday, sales fell by 29.9 percent to 156.5 million francs between April and September. At constant exchange rates, the decline was 29.0 percent, although the contrast affected all regions. At the same time, incoming orders fell by 9.7 percent to 127.9 million francs.

Profitability also fell due to the decline in sales and a “less favorable product and regional mix”. The operating surplus at the EBIT level fell by 72.6 percent to 14.2 million francs, the corresponding EBIT margin fell by 14 percentage points to 9.1 percent. The bottom line was a collapsed net profit of 8.6 million after 43.4 million in the same period of the previous year.

With the figures, LEM missed the analysts’ expectations in all key figures.

Medium-term goals postponed

The company is now providing a specific outlook for the 2024/25 financial year: Management expects sales of between 290 and 310 million francs and an EBIT margin in the high single-digit range.

The company also sees no improvement in sight in the longer term. The sales target of 600 million francs by 2027/28 will therefore be pushed back by two years: the sales mark with an EBIT margin of around 20 percent is therefore not expected until 2029/30.

To reduce costs, LEM is launching the “Fit for Growth” program. Details will follow when the annual results are announced at the latest.

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The LEM share was temporarily down 12.61 percent at 984.00 francs on the Swiss stock exchange.

Plan-les-Ouates (awp)