TRADING UPDATE 1Q20 Regulated information - Inside information Kortrijk, Belgium, 22 April 2020, 7:30 am - Today Barco (Euronext: BAR; Reuters: BARBt.BR; Bloomberg: BAR BB) announced the results for the first quarter ended 31 March 2020.
Financial highlights 1Q20
Orders @ 253.7 million euro of incoming orders, a decrease of 5.7% year-over-year. At constant currencies orders were 7.2% lower compared to last year.
Order book as of 31 March 2020 stood at 341.8 million euro, flat year-over-year and up 6% compared to the last quarter of last year.
Sales for the quarter were 235.7 million euro, a decrease of 2.9% compared to the first quarter of 2019. At constant currencies sales were 4.5% lower than last year.
Executive summary 1Q20
The start of 2020 was marked by the covid-19 outbreak and it had measurable impact on Barco's activities.
As a result of lockdowns in China, Barco's sales in China were halted during February and gradually resumed in March. Also in China, operations and supply chains were disrupted during February but recovered to near full capacity by the end of the first quarter.
The Entertainment division was growing through mid-March at which point demand for event projectors began to stall and cinema replacement cycle projects began to be pushed out.
In Enterprise, orders for the corporate segment increased during the quarter, fueled by the new ClickShare Conference product. However, in the latter half of March, weakening demand impacted both orders and sales which caused sales for the quarter to fall below last year's first quarter.
The Control Rooms segment was weak relative to a strong first quarter of 2019, due in part to softening demand from oil and gas industry customers compounded by project delays resulting from covid-19 lockdown measures.
The Healthcare division registered double digit topline growth with strong results for diagnostic imaging, mainly driven by intensified demand for remote radiology solutions amid the covid-19 crisis.
In addition, during the first quarter the company aligned the activity rate of its organization to the softening demand in some of its markets, shifted the investment timetable on selected longer-term initiatives and took significant discretionary cost containment actions that will remain in effect for the remainder of 2020.
Quote of the CEO, Jan De Witte
During these challenging times, the health and safety of Barco's employees, customers and partners is our highest priority. In response to covid-19 we have implemented measures to keep our employees safe by applying best-practice hygienic and social distancing guidelines, reconfiguring production facility lay-outs and expanding home-work protocol, said Jan De Witte, CEO of Barco.
The cost productivity and operational efficiency measures we implemented over the past few years, have created a more resilient business model, poised to withstand severe economic headwind. Based on our experience in China since January and with a persistent focus on both short and long term business continuity, we managed to contain our cost spending levels while keeping our manufacturing facilities operational.
Outlook
Barco's 2020 guidance, published in the full year 2019 report in February, anticipated impact from the shut-down of economic activity in China and associated supply chain disruptions during the first quarter. Since then, the covid-19 pandemic has spread internationally and has negatively impacted most of Barco's markets with the exception of Healthcare.
With both the timing of government decisions to ease restrictions and the economic impact of the pandemic on some of its markets uncertain, Barco's visibility for the year is currently limited. Therefore the company is withdrawing its full year outlook for 2020.
Management intends to give a full year 2020 outlook when it reports first half results in July 2020.
Barco believes it has reasonable visibility on the second quarter financial performance and expects the second quarter to be weaker than the first quarter resulting in a sales decline for the first half of approximately 10 to 15% versus last year.
By division, management anticipates a the second quarter with a weak demand for the Entertainment division, and in particular for the Cinema and the Events segments ; further demand shifts and deployment push-outs during the lock-down period for the Enterprise division, and a continued solid performance in line with the trends of the first quarter for the Healthcare division.
Dividend and stock split
The company reconfirms its proposal to the General Assembly to pay out a dividend of 2.65 euro per share.
The 7:1 stock split is also still planned but with a target trade date as of 1 July 2020 (and not 1 June 2020 as indicated in the full year press release issued 13 February 2020).
Conference call
Given the global economic uncertainties resulting from the covid-19 pandemic, Barco will host a conference call with investors and analysts on 22 April 2020 at 9:00 a.m. CET (3:00 am EST), to discuss the first quarter results and to provide perspective on the current environment and how it is working to mitigate the impact. Jan De Witte, CEO, Ann Desender, CFO and Carl Vanden Bussche, IRO, will host the call.
An audio cast of this conference call will be available on the Company's website www.barco.com by 12:30 p.m. Brussels time (6:30 a.m. EST).
Order Book & Order Intake
Order Book
(in millions of euro)
31 Mar 2020
31 Dec
2019
30 Sep
2019
30 Jun
2019
31 Mar
2019
Order book
341.8
322.3
359.1
344.2
341.0
Order Intake
(in millions of euro)
1Q20
4Q19
3Q19
2Q19
1Q19
Order Intake
253.7
292.7
275.6
264.9
269.0
Sales
Sales
(in millions of euro)
1Q20
4Q19
3Q19
2Q19
1Q19
Sales
235.7
319.2
266.9
253.7
242.8
Sales per division [1]
(in millions of
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TRADING UPDATE 1Q20 Regulated information - Inside information Kortrijk, Belgium, 22 April 2020, 7:30 am - Today Barco (Euronext: BAR; Reuters: BARBt.BR; Bloomberg: BAR BB) announced the results for the first quarter ended 31 March 2020. 
