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Video: Lapp Achieves Sales Growth Of 6 Percent
2023 Author: Hannah Pearcy | [email protected]. Last modified: 2023-06-05 00:21
Contrary to the general downward trend, the manufacturer of cable and connection technology Lapp recorded sales growth of six percent to EUR 1,222 million for the 2018/2019 financial year. The number of employees also grew by 9.5 percent to 4,650 employees. Earnings before taxes were negative, falling 17.6 percent to EUR 48.3 million.
The family-owned company recorded the greatest growth in Europe, but sales also increased in America and Asia. The economic slowdown was only noticeable in the last quarter, according to Lapp.
Lapp cites three factors as reasons for the growth:
- 1. Strategic sales initiatives such as the further development of the project business or the increase in sales in the industrial communication segment were growth drivers.
- 2. The acquisition of CEAM Cavi Speciali Srl. The Italian company was fully consolidated in the 2018/2019 financial year and generated sales of EUR 8.2 million.
- 3. Copper prices and exchange rates had less impact. The actual price of a cable is always calculated on a daily basis based on the current copper price. Since the price fell by an annual average of -3.8 percent (EUR 547/100 kg), total sales also decreased by -1.1 percent. Exchange rate fluctuations had a slight impact of 0.2 percent.
Difficult business development expected for 2019/2020
For the current business year 2019/2020, the company expects business to be difficult. The great uncertainties from the Corona crisis, Brexit and the general economic slowdown are likely to lead to a decline in sales compared to the previous year. In order to secure the financial scope for future growth, Lapp is paying more attention to cost efficiency. “After six years of growth, it was to be expected that the economic curve would once again point downwards. But I am optimistic that the bottom will soon be reached,”says Andreas Lapp, CEO of Lapp Holding AG.