Schneider Electric Revenue Falls -- Update
27 October 2016 - 10:42PM
Dow Jones News
By Inti Landauro
PARIS--France's Schneider Electric SA (SU.FR), one of the
world's biggest suppliers of power equipment and services, Thursday
said swings in currencies, weak deamand from Asia and the impact of
recent asset sales dragged third-quarter revenue lower.
The company said revenue fell 8% to 6.06 billion euros ($6.61
billion) in the three months to end-September from the same period
a year ago. The revenue was below market forecasts. Analysts polled
by FactSet had expected revenue of EUR6.18 billion.
Schneider Electric attributed the decline mainly to the EUR144
million impact of the depreciation in the Chinese yuan and the
British pound and a EUR283 million revenue loss related to the sale
of its Juno Lighting and Telvent Transportation units.
Beside the effects of currency and asset disposales, revenue
from Asia fell 12% in the quarter.
Schneider Electric makes low-voltage and automated equipment for
buildings, medium-voltage gear to utilities and grid operators and
sells automation systems for manufacturers and provides energy
management for buildings and factories.
Like many capital good manufacturers, Schneider Electric was hit
hard last year by the economic slowdown in China, the effects of
oil price slump on the oil service industry and weakness of other
commodity-driven economies such as Brazil. As investors and
analysts questioned Schneider Electric's dependence on
emerging-market economies and China, management reacted by cutting
costa and improving efficiency.
The company's chief executive, Jean-Pascal Tricoire, said the
cost-cutting and efficiency chasing had brought a 13% rise in net
profit in the first half of this year. Schneider Electric didn't
release third-quarter profit figures or any guidance for 2016 net
profit.
The company kept its target for flat full-year revenue,
excluding a likely EUR800 million hit to sales from
unfavorablerexchange rates and the revenue losses from assets it
sold recently.
Mr.Tricoire unveiled Thursday a new target to save between
EUR1.5 billion and EUR1.7 billion in the period 2015-2017, though
the restructuring charges will cost the company EUR900 million over
the period.
Schneider Electric shares were down 3.2% at EUR60.12.
-Write to Inti Landauro at inti.landauro@wsj.com
(END) Dow Jones Newswires
October 27, 2016 07:27 ET (11:27 GMT)
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