US stock futures flounder amid tech weakness, Fed caution
Investing.com -- Phoenix Mecano (SIX:PMN) shares fell over 3% on Tuesday after the Swiss manufacturer reported a sharp drop in second-quarter profit, weighed by weaker demand and restructuring costs.
The company said second-quarter orders declined 2% from a year earlier to €182 million, while sales dropped 4% to €181 million.
EBIT fell 40% to €8 million, including €3 million in restructuring costs. The operating margin narrowed to 4.3% from 7.3% a year earlier, missing the 6.7% margin expected by analysts.
First-half results showed a similar trend. Sales slipped 1% to €380 million, just above UBS estimates of €379 million but short of the €386 million consensus.
EBIT decreased 19% to €21 million, below both the UBS forecast of €22 million and the consensus of €26 million. Free cash flow for the first half stood negative at €9 million.
Performance varied across divisions. The DOT unit, which supplies motor systems for furniture, posted a 6% decline in organic sales and a 500-basis-point drop in EBIT margin to 3.4%.
The company cited tariffs as a factor in weaker customer orders, while some production activity has shifted away from China, where Phoenix Mecano recently established a large DOT production hub.
Industrial components reported a 3% decline in sales and an EBIT loss of €1.7 million, including €3 million in restructuring costs, as automation demand weakened.
Power management products performed better within the division. Enclosures recorded a 1% sales increase and improved its EBIT margin to 14.3% from 14.2%, supported by plant engineering demand.
The company said it does not expect further deterioration in end markets in the second half of the year but projected EBIT for 2025 could fall as much as 20% to €41 million.
Market consensus points to EBIT of €55 million, while UBS estimates €54 million, implying a downside risk of about 20%. The company generates more than 30% of its sales in Germany.