Hansen Transmissions International NV (“Hansen”, “the Group” or “the Company”, LSE ticker ‘HSN’) has announced its results for the three months ending 31 March 2010 and for the 12 months ending 31 March 2010.
Highlights of the 2010 financial year include:
- Revenue decline of 12.6%, in line with adjusted guidance of approximately 15% revenue decline given on 20 January 2010
- Earnings before interest, tax, depreciation and amortisation (EBITDA) margin at 7.8% (financial year 2009: 15.4%), up from 6% for the first half of the financial year
- Net loss of €8.6m, compared to a net profit of €45m for last year
- Net financial debt at €129m on 31 March 2010 – reduction of €59m in the last quarter of the financial year, as a result of intensified working capital management and careful deployment of expansion capex
- Consolidated net senior debt / EBITDA of 3.42 x at 31 March 2010, well within the renegotiated covenant level of 5.25 x for that period
- Actively managed phasing of capacity expansion plan while maintaining a target of delivering 14,300MW of capacity in financial year 2013; reduced capex in 2010 and 2011 financial years to better align with anticipated customer demand
- Ongoing management of fixed cost base and continued operational efficiencies
- Further diversification of the customer base: Hansen has announced a contract with Sinovel, a leading Chinese wind turbine manufacturer
- Tentative signs of recovery in a market environment that remains challenging, with Hansen continuing to be well-positioned with its growing portfolio of major customers
Alex De Ryck, CEO of Hansen commented: “At the core of Hansen’s strategy is our mission to reduce the kWh cost of renewable energy. We remain confident in the strong medium-term outlook for the global renewable energy market and although the past year has been challenging, we are beginning to see the first signs of recovery. We believe this trend will start to gain strength during the second half of the calendar year.
“We are in a strong position to benefit from the improving markets with well-invested state-of-the-art manufacturing capacity, an optimised supply chain and a restructured fixed cost base.
“Despite a careful focus on our cost base, we continue to innovate and diversify by adding important customers in strategically important regions. We are particularly pleased to announce the addition of Sinovel, a leading Chinese wind player.
“The past 12 months have been challenging for all Hansen’s stakeholders but I would especially like to thank our employees for their hard work and support in these uncertain times. We are cautiously optimistic and Hansen is well placed to take full advantage of the expected new growth phase in the renewable energy industry.”
Outlook
Since early 2009, the volatility and challenges affecting the short-term wind market have been reflected in Hansen’s financial results. This trend has continued and Hansen believes the operating environment will remain challenging.
While the order book has seen significant rescheduling, our ongoing dialogue with customers continues to suggest some optimism for improving industry investment from the second half of the 2010 calendar year.
Hansen expects the first quarter of the 2011 financial year to be in line with the last quarter of the 2010 financial year and revenue for the 2011 financial year to be back-end loaded. Against this backdrop, we expect to see revenue growth for the full 2011 financial year of around 5% to 10%, compared to the 2010 financial year.
Our expansion plans are phased and we remain both operationally and financially flexible in the continued execution of our growth strategy. From our strategy of profitable growth, we will continue to diversify our customer base and to carefully deploy capital to meet their capacity requirements.
Our confidence in the medium and longer-term fundamentals of the wind industry remains unchanged and we continue to be well positioned with a growing portfolio of major customers.
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