Monetary measure non-GAAP, see Interim Consolidated Monetary Statements 2020, pages Eight and 9
With out apprentices
Together with historic info, this report incorporates projections topic to dangers and uncertainties.
Tornos engaged within the struggle towards Covid-19
The coronavirus pandemic has additionally prompted Tornos to overview its priorities and interact much more alongside those that have fought, and nonetheless struggle each day, to avoid wasting lives. Thus, even when they’ve been much less delivered to the fore than medical doctors, nurses and caregivers, firms within the medical sector have been closely solicited, and are nonetheless working at full velocity in the present day to ship essentially the most. shortly potential the gear essential to avoid wasting lives in intensive care, such because the well-known ventilators from Hamilton Medical, the Grizzly-based firm that instantly aroused the curiosity of most people. Sure, Hamilton helps to avoid wasting lives, identical to an organization like Gloor Medical in Berthoud, which produces gadgets used to manage stress and move.
medical gases. Along with their frequent presence in intensive care, these two firms even have one other level in frequent: they each referred to as on Tornos' experience a number of many years in the past to have the ability to produce the important thing components of their gadgets. That is how Tornos participates, not directly, it’s true, within the basic effort to struggle towards the coronavirus.
And we may multiply the examples, since in all places in Europe, the US and Asia, many producers who’ve positioned their belief in Tornos use our machines to supply components important to the correct functioning of gadgets that assist medical professionals to avoid wasting lives.
four Tornos engaged within the struggle towards Covid-19
Tornos takes up main challenges
Girls and gents, pricey shareholders,
The coronavirus disaster has additionally hit the Tornos group laborious. At instances our enterprise has been nearly crippled all over the world. The pandemic broke out when the demand for single-spindle sliding headstock lathes and multi-spindle machines had already skilled a pointy financial decline. Final yr, structural developments within the automotive business and the unstable geopolitical scenario had led to nice reluctance in our markets and an exceptionally low order guide at first of 2020. This case additionally weighed on the Tornos group's monetary outcomes for the primary half of 2020. Glimmers of hope are rising on this very troublesome context, nevertheless, such because the restoration in demand from China on the finish of the primary half of 2020 and the slight rebound within the German and Italian markets, even when they’re nonetheless evolving at a really reasonable stage. As well as, we have been in a position to win some attention-grabbing orders within the medical know-how business, specifically for machines supposed for the manufacture of respiration apparatuses urgently required in the course of the coronavirus disaster.
In complete, our group generated web gross sales of CHF 56.2 million within the first half of 2020 (first half of 2019: CHF 117.2 million, -52.1%) and new orders of CHF 42.Eight million (first half of 2019: CHF 76.9 million, -44.Three%). The working outcome (EBIT *) for the primary half of 2020 reached CHF -13.1 million (first half of 2019: CHF Eight.9 million), whereas the online outcome quantities to CHF -13.9 million (first half of 2019: CHF 9.Zero million). On this
On this regard, it should be taken under consideration that the online outcome loses CHF Eight.1 million because of the improve in provisions for the inventory of products and good points CHF Three.2 million following the sale of the constructing to the rue de l'Écluse in Moutier. If gross sales resume sooner or later and the inventory of products runs out, provisions may very well be diminished accordingly, in favor of the outcome.
All market segments and all forms of machines have been affected by the foremost developments. As is usually the case in economically troublesome instances, our product line has been transferred from the upper value phase machines produced in Switzerland to these within the center and cheaper price phase from our manufacturing in Switzerland. China and Taiwan.
Intensive austerity measures
In view of the very troublesome financial scenario, Tornos has launched intensive price discount measures. The variety of staff of the group has fallen, from 729 individuals on the finish of 2019 to 636 on the finish of June 2020. Many of the jobs misplaced have been non permanent positions. Tornos has launched partial unemployment at varied websites in Switzerland and overseas. As well as, the board of administrators has determined to waive the dividend initially deliberate for our shareholders.
The group has completely preserved its liquidity regardless of the difficulties.
* Non-GAAP monetary measure, see Interim Consolidated Monetary Statements 2020, pages Eight and 9
Letter to shareholders 5
SwissDECO and SwissNano 7, nonetheless in demand within the medical and dental know-how sector
The SwissDECO and SwissNano 7 single-spindle sliding headstock lathes produced in Switzerland satisfied prospects within the medical, dental and electronics industries within the first half of 2020. Total, nevertheless, Tornos needed to take care of a big drop in orders in all product teams. The present demand for multi-spindle machines is especially low because of the financial scenario.
New automation options
To this point, 2000 Tornos machines have already been fitted with the user-friendly and upgradeable TISIS programming and communication software program. In the course of the first half of 2020, Tornos continued to develop automation options and carried out varied additions and updates.
Centralization accomplished in Moutier
Moutier, the centralization of manufacturing on the primary web site at rue Industrielle is absolutely accomplished, as has the modernization of the executive constructing with a brand new reception middle and convention rooms. A part of the products warehouse in addition to the corresponding logistics at the moment are managed by a specialised third occasion firm, which has contributed to the elevated flexibility of our firm.
Xi'an, manufacturing within the new premises
acquired off to a great begin.
“Nevertheless, we stay assured
medium and long run. “
Modifications inside the Common Administration
Bruno Edelmann, CFO, and Bruno Allemand, Head of Gross sales & Advertising, determined in June 2020 to go away the Tornos group to take up new skilled challenges. The Board of Administrators and Common Administration wish to thank the 2 long-standing members of the administration for his or her invaluable dedication to the Tornos group. Tornos will take this chance to adapt the administration construction to present market situations. Bruno Edelmann will hand over on 1er September 2020 to Luc Widmer, Head of World Provide Chain Administration in workplace, who beforehand held the place of CFO of the Tornos group from 2012 to 2015. Tornos will resolve on the succession of Bruno Allemand within the coming weeks.
Outlook
Present uncertainties make forecasting extraordinarily troublesome. The challenges forward are formidable. We anticipate a gradual restoration in international markets in 2021.
Total we aren’t but anticipating
main developments for the second half of 2020 and anticipate web gross sales corresponding to that of the primary half of 2020. Consequently, the outcomes by way of EBIT and web revenue will even be unfavorable by an analogous quantity. Nevertheless, we stay assured within the medium and long run. Tornos might be prepared for restoration following the financial recession which has worsened sharply because of the coronavirus disaster, because of its portfolio of merchandise that are completely suited to buyer wants and to its new providers. improved.
Francois Frôté
Michael Hauser
President of the council
CEO and President of the
administration
Government administration
With the mission of continually innovating and exploring new markets, Tornos seized the distinctive alternative, on the finish of January 2020, to current its SwissNano 7 to the Brazilian market in the course of the 38e São Paulo Worldwide Congress of Dentistry (CIOSP) in Brazil.
6 Letter to shareholders
Letter to shareholders 7
Common
In fiscal 2019, structural modifications within the automotive business resulted in decrease demand for single-spindle sliding headstock lathes and multi-spindle machines. Within the first half of 2020, the Tornos group was hit laborious by the coronavirus disaster. At instances she
paralyzed the virtually all of its actions, not solely within the sale of machines but in addition within the Companies exercise: throughout containment, the service technicians have been unable to succeed in their prospects because of the measures applied in lots of international locations. This case strongly penalized the monetary outcomes of the Tornos group within the first half of 2020.
Tornos reacted to unfavorable market developments within the second half of 2019, by adopting varied measures resembling drastic price reductions and job cuts, which primarily involved non permanent staff. The Tornos group maintained its rigorous austerity plan within the first half of 2020, which enabled it to restrict working losses. The outcome was nevertheless strongly affected by the provisions of CHF Eight.1 million on merchandise inventories, linked to extended storage and decrease consumption.
At this stage, it’s troublesome to find out the evolution of the tower market and to foretell the return of progress. The Tornos group expects reasonable new orders over a reasonably lengthy interval, therefore the rigorous implementation of further price discount measures, consistent with its technique of flexibility.
Coronavirus pandemic
The impression of the coronavirus pandemic varies by web site. In China, confinement was decreed on the finish of January. Shutdown in February, the Xi'an web site resumed operations in March. For its half, the manufacturing web site in Taichung (Taiwan) was not confined. In Europe, nationwide governments took strict measures between mid-March and mid-Could, a few of which additionally induced work disruptions. The US reacted comparatively late. A big a part of the measures adopted are nonetheless in pressure in July 2020.
Specifically, Tornos has established the next measures in response to the coronavirus disaster:
introduction of partial unemployment or discount of working time with wage financial savings; The corresponding techniques fluctuate vastly from nation to nation.
request for credit Covid-19, which has solely been partially used to this point;
job cuts;
adoption of rigorous austerity measures in all areas.
For the second, Tornos intends to take care of these measures at a comparable stage within the second half of 2020.
The target is to make sure the sustainability of the group. Extra info on measures associated to Covid-19 is out there within the “Interim Consolidated Monetary Statements 2020” (Observe 7, Affect of Covid-19 pandemic).
New orders and backlog
In complete, the Tornos group recorded order consumption of CHF 42.Eight million within the first half of 2020 (first half of 2019: CHF 76.9 million, -44.Three%). Completely different market segments and forms of machines have all skilled the shock wave. In troublesome financial instances, Tornos often sells extra machines
produced in Asia, that are within the center and cheaper price segments. In reality, prospects typically look ahead to higher days to spend money on machines within the larger value phase, resembling these produced in Moutier. In reality, almost 60% of the machines offered by Tornos within the first half of 2020 (in items) come from manufacturing websites situated in China and Taiwan.
Between the primary half of 2019 and 2020, new orders fell from CHF 36.9 million to CHF 17.2 million (-53%) in Europe, an important marketplace for Tornos. In Asia (together with the remainder of the world), the place the market restoration was already noticeable, new orders solely fell by CHF Zero.2 million
CHF 7.6 million (-Three%) in comparison with the corresponding interval of the earlier yr, Tornos even having grown by 50% in China in comparison with the primary half of 2019. In America, then again, the place the variety of coronavirus circumstances stays very excessive, Tornos' order consumption fell 61% from CHF 10.1 million to CHF Three.9 million.
Within the first half of 2020, the medical and dental know-how market phase represented 27% of complete order consumption, forward of electronics and the watch business,
11% every. Though it had been Tornos' first market phase for a number of years, the automotive business accounted for less than 7% of latest orders within the first half of 2020. The remaining 44% correspond to subcontractors (Job Retailers) who ship components within the 4 aforementioned sectors, in addition to in different markets resembling aeronautics or the pneumatic and hydraulic discipline. Subcontractors principally spend money on machines within the mid and cheaper price segments.
The Tornos group's order guide stood at CHF 20.2 million on June 30, 2020, a lower of 41% within the first half of 2020 (December 31, 2019: CHF 34.2 million).
Board of Administrators: Walter Fust, François Frôté, Until Fust, Michel Rollier
Common administration: Bruno Allemand, Michael Hauser, Luc Widmer, Bruno Edelmann
Web gross sales
Tornos generated web gross sales of CHF 56.2 million within the first half of 2020 (first half of 2019: CHF 117.2 million, -52.1%). With out foreign money results, web gross sales would have amounted to CHF 57.Eight million for the primary half of 2020 (-50.7% in comparison with the primary half of 2019). Within the Swiss market, web gross sales of CHF 14.7 million have been CHF 11.7 million decrease than within the first half of 2019 (-44%). In the remainder of Europe, it fell by CHF 43.Three million or 67% to CHF 21.Zero million.
In America, it fell by four.1 million, from CHF 12.Eight million to CHF Eight.7 million. The share of gross sales in Asia (together with the remainder of the world) amounted to CHF 11.Eight million within the first half of 2020, roughly 14% decrease than within the first half of 2019. Listed here are the shares the assorted areas in Tornos group web gross sales within the first half of 2020: Switzerland 26% (first half of 2019: 22%); remainder of Europe 37% (first half of 2019: 55%); America 16% (first half of 2019: 11%); Asia (together with the remainder of the world) 21% (first half of 2019: 12%).
Within the discipline of providers and spare components, Tornos recorded web gross sales of CHF 15.Zero million within the first half of 2020, or CHF 9.1 million much less in comparison with the corresponding interval of the earlier yr (first half of 2019: CHF 24.1 million). The sale of spare components has suffered notably, as has the Companies exercise, service technicians being unable to go to their prospects throughout containment.
Gross product
Within the first half of 2020, the gross revenue of the Tornos group fell from CHF 32.6 million to CHF 6.5 million in comparison with the corresponding interval of the earlier yr (first half of 2019: CHF 39.1 million), of which CHF 20.Three million are
attributable to volumes. The decline in margins of CHF 12.Three million is especially because of the sharp improve in provisions for inventories of products.
As famous within the FY2019 report, merchandise inventories have risen sharply over the previous yr, because of the sharp decline in new orders within the automotive business. On the machine stage, the assure of a aggressive supply time requires ordering some components and elements a number of months upfront. Nevertheless, solely a small a part of the shares may very well be offered as deliberate because of the coronavirus pandemic. On account of extended storage and decrease consumption, worth changes on merchandise inventories have exploded. In the course of the first half of 2020, they weighed on the Tornos group's outcome by CHF Eight.1 million. Tornos believes that worth changes on merchandise inventories will improve additional within the second half of 2020.
On the premise of the present scenario, this improve ought to stop in 2021. If gross sales resume sooner or later and the inventory of products decreases, the provisions may very well be diminished accordingly, in favor of the outcome.
On the identical time, shares of products price CHF 1.1 million have been scrapped within the first half of 2020, as a part of the switch of a considerable a part of the inventory of uncooked supplies to an exterior accomplice . The remaining CHF Three.1 million of the margin decline pertains to the product vary. In comparison with the identical interval final yr, extra machines within the center and cheaper price segments have been offered within the first half of 2020. The gross margin of those machines is decrease than the machines within the larger value phase.
The gross margin for the primary half of 2020 was 11.5% (first half of 2019: 33.four%).
ISO 9001 licensed in December 2018, Tornos Xi'an handed its surveillance audit in April 2020.
Exploitation costs
The stringent austerity measures launched by the Tornos group within the second half of 2019 entered into pressure within the first half of 2020. They’ve diminished working bills from CHF 7.1 million to CHF 22.9 million in comparison with
the corresponding interval of the earlier monetary yr (first half of 2019: CHF 30.Zero million). Advertising and gross sales prices fell by CHF four.Zero million, analysis and improvement prices by CHF 2.Zero million. Administration and miscellaneous prices decreased by CHF 1.1 million.
Non-operating revenue
Non-operating revenue consists of the revenue of CHF Three.2 million on the sale of the previous manufacturing constructing “Rue de l'Écluse 49”, in addition to the online earnings of the non-operating constructing of the “Tour Bechler”. (CHF Zero.1 million). The residential constructing is absolutely leased.
After the opening of its new buyer facilities in United States, Thailand and China, Tornos has determined to proceed its technique in Italy as properly, by constructing the brand new Buyer Heart Milan. The official inauguration is scheduled for October 2020.
EBITDA and EBIT *
The outcome earlier than monetary costs, taxes and depreciation (EBITDA) amounted to CHF -11.Zero million within the first half of 2020 (first half of 2019: CHF 11.Zero million). The EBITDA margin amounted to -19.6% (first half of 2019: 9.four%). The outcome earlier than monetary costs and taxes (EBIT) amounted to CHF -13.1 million (first half of 2019: CHF Eight.9 million). The affect of change charges on EBIT was minimal within the first half of 2020. The EBIT margin was -23.Three% (first half of 2019: 7.6%).
Web revenue
Within the first half of 2020, web monetary costs have been barely decrease than within the earlier yr. The energy of the Swiss franc towards the euro and the US greenback led to the depreciation of sure steadiness sheet positions, which had a unfavorable impression on the results of foreign money results. This amounted to CHF -Zero.7 million within the first half of 2020 (first half of 2019: CHF +Zero.four million). The web outcome amounted to CHF -13.9 million within the first half of 2020 (first half of 2019: CHF 9.Zero million). The margin was -24.Eight% (first half of 2019: 7.7%).
Stability sheet
The steadiness sheet complete decreased from CHF 24.5 million to CHF 143.Zero million in comparison with December 31, 2019. On the asset aspect, liquidity fell from CHF 1.5 million to CHF 12.9 million. Receivables from deliveries and providers fell from CHF four.four million to CHF 12.5 million, on account of decrease gross sales income. Inventories of products fell from CHF 17.5 million to CHF 84.four million. This lower is due for CHF Eight.1 million to the foremost improve in provisions on inventories of products talked about above. Different receivables and transitional property elevated by CHF Zero.5 million.
The fastened property of the Tornos group have been decrease by round CHF 1.7 million on June 30, 2020 in comparison with December 31, 2019, at CHF 27.Zero million. A big a part of this lower outcomes from the sale of the constructing “Rue de l'Écluse 49”. By way of liabilities, monetary commitments elevated from CHF 7.1 million to CHF 22.2 million, of which CHF 5.Zero million was a mortgage from the principal shareholder and CHF 2.1 million was a Covid-19 mortgage granted. by banks. The lower of CHF 13.5 million in commitments ensuing from deliveries and providers in comparison with December 31, 2019 is because of the lower in buying quantity. Different liabilities fell from CHF 2.6 million to CHF 5.6 million. This determine consists of down funds from prospects, which decreased on account of decrease order consumption within the first half of 2020. Brief-term provisions fell by CHF 1.1 million because of the discount in guarantee provisions on the machines offered. The opposite legal responsibility objects haven’t skilled any vital change in comparison with December 31, 2019.
As of June 30, 2020, web money * amounted to CHF -9.four million (December 31, 2019: CHF -Zero.9 million).
Within the first half of 2020, shareholders' fairness fell by CHF 14.2 million to CHF 93.6 million (December 31, 2019: 107.Eight million). As of December 31, 2019, the minority portion consisting of 30% of shares within the manufacturing firm in Xi'an (CN) held by a 3rd occasion amounted to CHF Zero.four million. Tornos purchased this share from the related Chinese language accomplice in January 2020 and now owns 100% of the corporate. The fairness margin elevated by one proportion level to 65.four% (December 31, 2019: 64.four%).
* Non-GAAP monetary measure, see Interim Consolidated Monetary Statements 2020, pages Eight and 9
Administration report 13
Money move
Money move from working actions amounted to CHF -Eight.Eight million within the first half of 2020 (first half of 2019: CHF -9.5 million). It was influenced by the unfavorable half-year outcome (CHF -13.9 million) and by the rise in web present property (CHF -2.9 million), web of the institution of provisions and worth changes. (CHF Eight.7 million). Underneath the merchandise “Disposal of property, plant and gear” (cf. Interim Consolidated Monetary Statements 2020) seems the sale of the constructing “Rue de l'Écluse 49”.
The corresponding remaining money move of CHF 2.Zero million within the first half of 2020 is proven below money move from investing exercise. Investments reached CHF 1.Zero million within the first half of 2020 (first half of 2019: CHF 2.6 million). These money flows generated free money move * of CHF -Eight.Zero million within the first half of 2020 (first half of 2019: CHF -12.2 million). Tornos obtained a mortgage of CHF 5.Zero million from its primary shareholder to cowl the money outflows. As well as, subsidiaries in Germany, France and the US have obtained Covid-19 credit amounting to CHF 2.1 million. The buyback of the 30% minority stake in Tornos Xi'an represents an extra money outflow (CHF Zero.7 million). The web lower in liquidity subsequently amounted to CHF -1.7 million (first half of 2019: CHF -17.2 million).
Modifications inside the Common Administration
Bruno Edelmann, CFO, and Bruno Allemand, Head of Gross sales & Advertising, each determined in June 2020 to go away the Tornos group to deal with
new challenges. Bruno Edelmann will hand over on 1er September 2020 to Luc Widmer, Head of World Provide Chain Administration in workplace, who beforehand held the place of CFO of the Tornos group from 2012 to 2015. Bruno Allemand might be leaving
his duties inside Tornos on the finish of 2020. The Board of Administrators and Common Administration wish to thank Bruno Edelmann and Bruno Allemand for his or her invaluable dedication to the Tornos group. Tornos will take this chance to adapt the administration construction to present market situations.
Collaborators
As of June 30, 2020, the Tornos group employed
636 staff (in full-time equivalents) and 35 apprentices (December 31, 2019: 729 staff and 35 apprentices). Many of the workforce discount involved the Swiss websites of Moutier and La Chaux-de-Fonds. The job cuts primarily focused non permanent staff. Tornos has lower different positions at its manufacturing websites in China and Taiwan, in addition to at its gross sales and repair firms. The lack of jobs generated financial savings of CHF 9.Three million, whereas the introduction of partial unemployment diminished the half-yearly accounts by CHF Three.Eight million.
Outlook
Present uncertainties make forecasting extraordinarily troublesome. The present challenges are vital. Tornos is relying on a gradual restoration of the worldwide markets in 2021. Total, the group doesn’t but anticipate main developments for the second half of 2020 and expects web gross sales corresponding to that of the primary half of 2020. Consequently, , the figures ought to stay unfavorable by way of EBIT and web revenue. Tornos stays assured within the medium and long run, nevertheless. The group might be prepared for restoration following the financial recession which has worsened sharply because of the coronavirus disaster, because of its portfolio of merchandise in good concord with the wants of consumers and its providers of latest improved.
* Non-GAAP monetary measure, see Interim Consolidated Monetary Statements 2020, pages Eight and 9
14 Administration report
The development of the brand new Tornos plant in Xi'an was accomplished in January 2020. The official opening of the premises needed to be postponed because of the coronavirus pandemic. It’s scheduled for October 2020.
We preserve you turning
TORNOS HOLDING AG
Tornos
by means of
Industrial Road 111
the world
P.O. Field 960
2740 Moutier / Switzerland
tornos.com
T +41 (Zero) 32 494 44 44
contact@tornos.com
The corporate Tornos Holding AG posted this content material on July 31, 2020, and is solely accountable for the data contained therein. The contents have been launched by Public unedited and unedited, on11 Aug 2020 07:39:06 UTC.
