Lida Group'S Orders Fell Sharply In The First Half Of 08

The Rieter group reported that the business trend in the first half of 2008 was rather weak, while the same period in 2008 was very strong.

The Asian textile machinery market is in the doldrums, North American pport output has declined, raw materials, energy and pportation costs have risen sharply, which has a negative impact on orders, sales and profits in the first 6 months of this year.

Lida is also inevitably affected by the cyclical downturn of the textile machinery and pport market, and the global economy is also generally affected.

However, Lida has relied on brand superiority, high quality products, global visibility and loyalty to its enterprises to maintain a strong market share.

Owing to the serious decline in demand from the Ministry of textile industry, the group's orders fell by 32% to 1 billion 559 million 300 thousand Swiss francs.

Sales amounted to 1 billion 806 million 600 thousand Swiss francs, representing a decrease of 6% over the first half of 2007 (3% below the current exchange rate adjustment).

Business trends in the first half of 2007 were weak and demand fell sharply in the first half of 2008, resulting in a decline in sales of the textile system department.

The automatic system shows that sales have dropped substantially, mainly influenced by exchange rate, and mainly in North America.

Cash flow decreased from last year to 114 million 500 thousand Swiss francs.

In June 30, 2008, the property rights rate was 46% (51.5% in the same period in 2007).

As of June 30, 2008, the total number of employees in Lida Group was 15316 (excluding temporary workers), which was roughly the same as that of 15062 in June 30, 2007.

Orders in the textile department of Lida fell sharply.

The global textile machinery market began to weaken in the fourth quarter of 2007, and demand for short staple machines dropped sharply, especially after March 2008.

Due to poor business prospects, Lida's main market customers have greatly reduced or delayed capital investment, especially the Asian spinning mills.

The main reason for this phenomenon is that the price of raw materials is high, the yarn stock is large, China implements a more restrictive investment policy, the attractiveness of investment promotion arrangements in other major markets is weakened, and at the same time, the cost of energy is higher, and the exchange rate is unfavorable to the spinning mills.

Textile machinery market has obvious demand cycle, but the current downturn is more serious than the previous cycle.

In the first half of 2008, the total volume of Lida textile system orders was 417 million 300 thousand Swiss francs, which was 61% lower than that of the same period last year.

Staple machines are mainly affected by orders reduction.

However, the Department of textile systems has managed to maintain the overall market share, despite the adverse business environment.

Sales of textile systems decreased by 6% to 664 million 700 thousand Swiss francs (706 million 200 thousand Swiss francs for the same period in 2007).

The volume of business decreased by more than expected. Due to the more difficult economic environment, customers postponed accepting products or postponing order time.

The textile system reported that in the first 6 months of 08, the business income was 55 million 400 thousand Swiss Franc (93 million 700 thousand Swiss francs in 2007).

This figure includes the income of 2 million 600 thousand Swiss francs for the separation of granular machinery business.

Gross profit was 8.8% (13% in 2007).

Raw materials (steel, sheet metal and castings) surged, pportation costs and energy costs increased, resulting in a loss of about 15 million Swiss francs.