News

Johnson Electric reports Business and Unaudited Financial Information for the Third Quarter of Financial Year 2020/21

HONG KONG SAR - Media OutReach - 14 January 2021 -
This news release is made by Johnson Electric Holdings Limited ("Johnson
Electric" or the "Company" and together with its subsidiaries, the "Group") for
the business operations and selected unaudited financial information of the
Group for the three months and the nine months ended 31 December 2020.

 

The Board of Directors (the
"Board") of the Company considers the publication of quarterly sales performance
updates to be consistent with international corporate disclosure best practice.
The objective of this news release is to provide transparency and to ensure
that investors and potential investors receive equal access to the same
information at the same time.

 

The Group's sales for the
quarter ended 31 December 2020 were US$912 million compared to US$773 million
for the same quarter in 2019, an increase of 18%. Excluding currency movements,
sales increased by 15% to US$887 million. Foreign exchange rate movements had a
positive effect of US$25 million on the Group's sales for the quarter ended 31
December 2020. This was mainly due to the impact of the stronger average
exchange rates for the Euro and Chinese Renminbi against the US Dollar,
compared to the same quarter in 2019.

 

The recovery in sales
experienced in the second quarter gathered momentum in the third quarter,
partially mitigating the deep pandemic-driven decline experienced in the first
quarter of the financial year. Overall, the Group recorded sales of US$2,242
million for the nine months ended 31 December 2020, compared to US$2,338
million for the same period in 2019, a decrease of 4%. Excluding currency
movements, sales for the nine months ended 31 December 2020 decreased by 5%.

 

Sales of Automotive
Products Group ("APG")

APG's sales for the quarter
ended 31 December 2020 increased by US$107 million or 17% compared to the same
quarter in 2019.  Excluding currency
effects, APG's sales increased by US$84 million or 13% in the quarter.

 

APG's sales outperformed
compared to automotive industry production volumes, in all regions, in both the
nine months and the quarter ended 31 December 2020. Although the COVID-19
pandemic sharply reduced APG's sales in April and May 2020, particularly in
Europe and the Americas, the Group subsequently experienced a significant
recovery in demand. The sales changes by region, excluding currency effects,
were as follows:

 

 

Quarter ended
31 December 2020

Nine months ended
31 December 2020

Asia

increased 16%

increased 6%

Europe

increased 7%

decreased 20%

Americas

increased 17%

decreased 13%

Total

increased 13%

decreased 8%

 

Johnson Electric's
innovative technology and product portfolio remains well positioned to meet
growing demand for the electrification of critical automotive functions to
increase powertrain efficiency, reduce vehicle weight, improve safety,
reliability and enhance comfort.

 

Sales of Industry
Products Group ("IPG")

IPG's sales for the quarter
ended 31 December 2020 increased by US$32 million or 21% compared to the same
quarter in 2019. Excluding currency effects, IPG's sales increased by US$29
million or 20% for the quarter.

 

IPG's business and financial
performance benefited significantly from changes in consumer behaviour and
expenditure in response to the COVID-19 pandemic. As consumers in many
countries were required to spend more time at home, the division experienced
strong demand for products for food and beverage, floor care, home office
printer, lawn and garden, window automation, power tool, sanitation and
ventilation applications. The medical segment also experienced strong growth,
driven by the long-term imperative to reduce the labour intensity of hospital
procedures.

 

These positive demand
dynamics were partly offset by the COVID-19 pandemic's adverse impact on some
specific customers and market segments. In Europe and the Americas, sales to
many small and medium enterprises decreased as consumers switched to purchasing
through the online sales channels of larger competitors. Commercial printers,
metering, flexible printed products and switches segments were also slower than
usual.

 

On a regional basis, IPG
experienced the highest sales growth in Asia due in large part to the rapid
recovery of China's industrial sector and strong global demand for the
country's manufactured goods. In Europe and the Americas, the path to recovery
in some segments has taken somewhat longer and in the US, in particular, IPG's
sales have been hampered by delays from port congestion as well as land and
rail logistical bottlenecks. The sales changes by region, excluding currency
effects, were as follows:

 

 

Quarter ended
31 December 2020

Nine months ended
31 December 2020

Asia

increased 35%

increased 18%

Europe

increased 22%

increased 6%

Americas

flat

decreased 3%

Total

increased 20%

increased 8%

 

Chairman's Comments on Sales
Performance and Outlook

Concerning the quarter ended
31 December 2020 sales performance, the Chairman and Chief Executive, Dr.
Patrick Shui-Chung Wang, said, "The strong recovery in demand that we
experienced during the second quarter continued in the third quarter -- with
sales levels in both APG and IPG running well ahead of the third quarter in the
prior year.  Although there remains some
uncertainty as to how the upsurge in COVID-19 in many Western countries could
impact business activity and consumer confidence, the Group is presently on track
to deliver full-year total sales close to the level achieved in the prior
financial year.  This would represent a
very satisfactory achievement given the fact that such a large portion of
Johnson Electric's operations was either shutdown or significantly constrained
during the first two months of the current financial year."

 

Cautionary
Statement

Shareholders and potential
investors in the Company are reminded that the information provided in this news
release, including information related to the expected outlook for the full
year, is based on the Group's unaudited internal records and management accounts.
This information has not been reviewed or audited by the Company's auditors.

 

Shareholders
and potential investors should exercise caution when dealing or investing in
the shares of the Company.

About Johnson Electric Group

The
Johnson Electric Group is a global leader in electric motors, actuators, motion
subsystems and related electro-mechanical components. It serves a broad range
of industries including Automotive, Smart Metering, Medical Devices, Business
Equipment, Home Automation, Ventilation, White Goods, Power Tools, and Lawn
& Garden Equipment. The Group is headquartered in Hong Kong and employs over
35,000 individuals in 23 countries worldwide. Johnson Electric Holdings Limited
is listed on The Stock Exchange of Hong Kong Limited (Stock Code: 179). For
further information, please visit: www.johnsonelectric.com.

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