Post by eileen on Jul 20, 2012 21:26:04 GMT 4
Belgian visual display technology company Barco sold more of its cinema projectors and medical systems than expectd in the second quarter, swelling profits and sending its shares to a two-month high.
Barco's growth in the past two years has been fueled by an explosion of orders for digital cinema projectors, but analysts expressed concern after weaker-than-expected flat first-quarter sales that the market had passed its peak.
Barco Chief Executive Eric Van Zele said that the company was gaining market share, selling replacement and next-generation projectors and pushing into new markets - the corporate world and smaller venues, a mid-segment including hospitals and universities.
"It's fair to say that Barco has won the battle in digital cinema," said Van Zele, who confirmed on Friday he would be staying on until May 2014. "We think a decline in digital cinema can be offset by the corporate audio-visual market."
Group sales rose 8.3 percent in the first six months to 531 million euros ($646.1 million) and core profit (EBITDA) by 19.6 percent to 71.7 million euros. The market had on average been 501 million and 63.6 million euros expected respectively.
Barco shares rose by as much as 8.2 percent to a two-month high, closing up 3.6 percent at 47.16 euros.
KBC Securities upgraded the company's stock to "buy" from "accumulate", saying the results were outstanding on all levels.
"The weak Q1 trading updated created some uncertainty, but the H1 release takes away any fears one could have over this year's sales or margin evolutions," KBC said in a note.
Bank Degroof said that until now there was no sign that the global economic slowdown was harming Barco's business.
Van Zele said business in Europe was soft, but Barco was doing very well in the Latin America and Asia-Pacific region, in the latter particularly outside China.
He added the company was cautious about the future given global economic uncertainty, but that Barco was confident of doing better than the market average.
The company said it saw further growth in healthcare - such as in bedside terminals and in the linking of hospital records via networks - and was upbeat about Clickshare, a system allowing wireless transmission from laptop to screens, and Livedots, its LED display unit for high-end screens, such as those on Times Square.
Van Zele cautioned not to expect strong numbers in the third quarter, a seasonal weak period because of European summer holidays. Barco traditionally does well in the second and fourth quarters.
The company, which has a goal of doubling revenue to 2 billion euros in the five years from 2011, is also seeking to limit costs by growing its manufacturing base in China and India.
Van Zele said Barco did not intend to pay any extra dividend and would tend to use any funds from possible divestments of some of its ventures to reinvest in its core businesses.
The strong dollar had helped the company a little, but with almost 80 percent of its exposure hedged the impact was and would be limited. ($1 = 0.8219 euros)
reuters
Barco's growth in the past two years has been fueled by an explosion of orders for digital cinema projectors, but analysts expressed concern after weaker-than-expected flat first-quarter sales that the market had passed its peak.
Barco Chief Executive Eric Van Zele said that the company was gaining market share, selling replacement and next-generation projectors and pushing into new markets - the corporate world and smaller venues, a mid-segment including hospitals and universities.
"It's fair to say that Barco has won the battle in digital cinema," said Van Zele, who confirmed on Friday he would be staying on until May 2014. "We think a decline in digital cinema can be offset by the corporate audio-visual market."
Group sales rose 8.3 percent in the first six months to 531 million euros ($646.1 million) and core profit (EBITDA) by 19.6 percent to 71.7 million euros. The market had on average been 501 million and 63.6 million euros expected respectively.
Barco shares rose by as much as 8.2 percent to a two-month high, closing up 3.6 percent at 47.16 euros.
KBC Securities upgraded the company's stock to "buy" from "accumulate", saying the results were outstanding on all levels.
"The weak Q1 trading updated created some uncertainty, but the H1 release takes away any fears one could have over this year's sales or margin evolutions," KBC said in a note.
Bank Degroof said that until now there was no sign that the global economic slowdown was harming Barco's business.
Van Zele said business in Europe was soft, but Barco was doing very well in the Latin America and Asia-Pacific region, in the latter particularly outside China.
He added the company was cautious about the future given global economic uncertainty, but that Barco was confident of doing better than the market average.
The company said it saw further growth in healthcare - such as in bedside terminals and in the linking of hospital records via networks - and was upbeat about Clickshare, a system allowing wireless transmission from laptop to screens, and Livedots, its LED display unit for high-end screens, such as those on Times Square.
Van Zele cautioned not to expect strong numbers in the third quarter, a seasonal weak period because of European summer holidays. Barco traditionally does well in the second and fourth quarters.
The company, which has a goal of doubling revenue to 2 billion euros in the five years from 2011, is also seeking to limit costs by growing its manufacturing base in China and India.
Van Zele said Barco did not intend to pay any extra dividend and would tend to use any funds from possible divestments of some of its ventures to reinvest in its core businesses.
The strong dollar had helped the company a little, but with almost 80 percent of its exposure hedged the impact was and would be limited. ($1 = 0.8219 euros)
reuters