Johnson Electric reports Business and Unaudited Financial Information for the First Quarter of Financial Year 24/25
HONG KONG SAR - Media OutReach Newswire - 11 July 2024 - This news release is made by Johnson Electric Holdings Limited ("Johnson Electric" or the "Company" and together with its subsidiaries, the "Group") for the business operations and selected unaudited financial information of the Group for the three months ended 30 June 2024.
The Group's sales for the quarter ended 30 June 2024 were US$935 million compared to US$954 million for the same quarter in financial year 23/24, a decrease of 2%. Exchange rate movements had a US$8 million unfavourable impact on the Group's sales for the quarter. Without the effect of currency movements, the sales decline would have been approximately 1%.
Sales of Automotive Products Group ("APG")
APG's sales for the quarter ended 30 June 2024 were flat at US$788 million compared to the same quarter in financial year 23/24. Excluding currency effects, APG's sales increased by US$5 million or 1% in the quarter, while global light vehicle industry production volumes remained unchanged.
In Asia-Pacific, sales increased by 7% while light vehicle production in the region grew 3%. Most product segments experienced growth, with particularly strong performance in thermal management, oil pumps, vision and steering mainly due to new program launches and volume increases. In Europe, the Middle East and Africa ("EMEA"), sales decreased by 4% compared to a 5% decline in light vehicle production in the region. Sales of steering and oil pumps decreased, somewhat offset by an increase in products for closure and seat applications. In the Americas, sales decreased by 2% while light vehicle production declined by 1%. Sales of powder metal components, thermal management and seat product applications decreased, primarily due to customer mix and the phasing of certain programs, partially offset by increased sales of oil pumps and products for closure and braking applications.
The division's sales changes by region, excluding currency effects, were as follows:
| | Quarter ended 30 June 2024 | |
| Asia-Pacific | 7% | Increase |
| Europe, Middle East and Africa | 4% | Decrease |
| Americas | 2% | Decrease |
| Total | 1% | Increase |
Sales of Industry Products Group ("IPG")
IPG's sales for the quarter ended 30 June 2024 were US$147 million, a decrease of US$16 million or 10% compared to the same quarter in financial year 23/24. Currency effects were insignificant.
Sales in EMEA and the Americas declined due to surplus inventory in manufacturing and retail channels and soft end-market demand. This was further compounded by consumers exercising caution in their discretionary spending, delaying purchases, and gravitating towards the more affordable end of the market. In contrast, sales in Asia-Pacific increased during the quarter as certain customers resumed placing replenishment orders having consumed the previous levels of excess inventory, and also due to some new business wins.
The sales changes for IPG by region, excluding currency effects, were as follows:
| | Quarter ended 30 June 2024 | |
| Asia-Pacific | 6% | Increase |
| Europe, Middle East and Africa | 18% | Decrease |
| Americas | 12% | Decrease |
| Total | 10% | Decrease |
Chairman's Comments on Sales Performance and Outlook
Commenting on the first quarter's sales performance, Dr. Patrick Shui-Chung Wang, Chairman and Chief Executive, said: "As previously reported in our year-end results announcement, trading conditions at the start of financial year 24/25 have been comparatively subdued. This partly reflects the exceptionally strong level of sales to the automotive sector in the first quarter of the prior financial year, when the industry was experiencing a sharp rebound in demand following a protracted period of supply constraints. Since then, automotive industry volumes have gradually returned to more normalised levels that reflect the state of the global economy and the vehicle replacement cycle. In this context, our Automotive Products Group's sales remain resilient, and the division continues to make encouraging progress in rolling out innovative technology solutions that strengthen its position as a market leader in motion products and subsystems that are critical enablers to the industry's electrification transition. On the other hand, the Industry Products Group, which contributes approximately 16% of total sales, continues to experience a challenging near-term outlook given the low levels of consumer confidence and cautious spending on discretionary hardware products in many of its largest markets. IPG's management team is working aggressively to focus resources on segments that offer the most compelling long-term growth potential while, at the same time, ensuring that the cost base is optimised to remain competitive in more commoditized product applications."
Cautionary Statement
Shareholders and potential investors in the Company are reminded that the information provided in this news release, including information related to the expected outlook for the full year, is based on the Group's unaudited internal records and management accounts. This information has not been reviewed or audited by the Company's auditors.
Shareholders and potential investors should exercise caution when dealing or investing in the shares of the Company.
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The issuer is solely responsible for the content of this announcement.
About Johnson Electric Group
The Johnson Electric Group is a global leader in electric motors, actuators, motion subsystems and related electro-mechanical components. It serves a broad range of industries including Automotive, Smart Metering, Medical Devices, Business Equipment, Home Automation, Ventilation, White Goods, Power Tools, and Lawn & Garden Equipment. The Group is headquartered in Hong Kong and employs over 30,000 individuals in 22 countries worldwide. Johnson Electric Holdings Limited is listed on The Stock Exchange of Hong Kong Limited (Stock Code: 179). For further information, please visit: www.johnsonelectric.com.
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