Financing: Steps to optimize cash flow, reduce working capital and to strengthen the balance sheet in the medium term were also rolled out. Besides a reduction in capital expenditure to below depreciation levels, a strict focus on key R&D projects, further cuts in discretionary spending and the sale of non-operational real estate is targeted. Together with defined working capital reductions, a potential of more than CHF 300 million has been identified. At the same time, the company is in the process to amend the syndicated facility. Results are expected in the second quarter 2009. Equity market transactions are in consideration.
Portfolio: Progress continues to further streamline the portfolio. The sale of Oerlikon Esec to the Dutch company BE Semiconductor Industries N.V. is closed and the management buy-out of the Etch business in St. Petersburg, Florida (USA) is completed. This brings Oerlikon Group's overall exposure to the semi-conductor industry down to less than three percent of sales. Additional disposals are being evaluated.
"Through the consequent execution on all three work streams of our corporate program we are convinced that Oerlikon will sustain in this adverse business environment", says Oerlikon CEO Dr. Krüger.
Outlook Oerlikon continues to refrain from any detailed sales or profit forecasts for the current year due to the ongoing low visibility in major markets. Although on a low level, the sequential order increase of 19 percent in the early cycle Textile business in the first quarter of 2009 indicates the possibility for a recovery in other markets. Specifically for Oerlikon Solar, a normalization of the business is expected for the second half of 2009. "We are cautiously optimistic that current negotiations with our customers will result in at least one large order by then." says CEO Dr. Krüger. Broadly sized stimulus packages as well as increased willingness of banks to finance new businesses will help to improve the current business environment.
Segment performance Oerlikon Textile Oerlikon Textile sales for the first quarter were at CHF 196 million (-58 percent), new orders stood at CHF 236 million (-45 percent) and orders on hand amounted to CHF 502 million (-31 percent).