November 12, 2010 15:08 ET


Revenues up 14.3%, With EBITDA Once Again in Positive Territory and Clearly Improving Also in the Third Quarter

AMARO, ITALY--(Marketwire - November 12, 2010) -

- Consolidated revenues: from €57.53 million to €65.76 million, +14.3%

- Consolidated gross profit: from €30.44 million to €33.75 million

- Consolidated EBITDA: from €-1.06 million to €1.71 million

- Consolidated EBIT: from €-6.91 million to €-4.25 million

- Consolidated pre-tax profit (loss): from €-7.82 million to €- 6.30 million

- Net financial debt: €10.9 million

Today the Board of Directors of Eurotech S.p.A. reviewed and approved the results relating to the first nine months and to the third quarter of 2010.


In the first nine months of the year, Group revenues continued to register growth and came in at €65.76 million, advancing by 14.3% compared with €57.53 million in the same period of 2009.

The rise of €8.22 million in sales is a direct consequence of the upturn in orders, which, as highlighted in August, were well above those registered for the same period of the previous year. Also at the end of October 2010, the Group's order backlog maintained growth of more than 50% compared with the same period of 2009. The Group continues to benefit from a general recovery, which, although varying in intensity, has affected different market segments: all areas have shown the beginning of an upturn, with growth therefore also expected at the end of the year compared with 2009.

The gross profit margin in the first nine months of 2010 remained in line with that of previous quarters and that registered at the end of 2009, at 51.3%, down slightly on the 52.9% registered in the first nine months of 2009. This trend reflects the Group's business performance in terms of the mix of products sold. Gross profit as a percentage of revenues remained above 50% in the first nine months of 2010, which is the target set by management. Once again, it confirms the validity of the business model applied by the Group, based on the sale of high value products, and constant attention to COGS, particularly given the current general scarcity of components in the supply chain of integrated circuits (chips).

During the first nine months of 2010, the Group paid particular attention to implementing synergies between the Japanese affiliate and its other operating units, with a special focus on maintaining an overall structure able to sustain higher revenue levels.

In 9M10, EBITDA rose to €1.71 million, from a negative €1.06 million in 2009. This improvement reflects the actions taken by management to contain costs and resulted in a different ratio of EBITDA to revenues, which rose from -1.8% in 9M09 to 2.6% in 9M10, with an improving trend in the third quarter.

EBIT came in at a negative €4.25 million, and was -6.5% as a percentage of revenues. This was an improvement versus the first nine months of 2009, when the figure was €-6.91 million and -12.0% as a percentage of revenues. The ratio of EBIT to revenues continues to be affected by the level of sales which remain lower than the structure's real potential, as well as depreciation and amortisation charged to the income statement in the first nine months of 2010, which arose both from operating assets that became subject to amortization during this period and from the non-monetary effects of PPA (purchase price allocation), which in 9M10 amounted to €2.51 million (versus €2.31 million in 9M09).

In 9M10, Eurotech booked a pre-tax loss of €6.30 million, versus a loss of €7.82 million in 9M09. This performance was affected by the factors described above and by the results of financial operations, that registered negative foreign exchange differences of €1.30 million on the financial liability relating to the Advanet option due to the appreciation of the Japanese Yen versus the Euro, which occurred at the same time as the mid-June payment. PPA effects on the pre-tax result amounted to €3.75 million in 9M10, compared with €2.03 million in 9M09.

The Group net loss decreased from €8.73 million in 9M09 to €7.23 million in 9M10. The total effects stemming from price allocation had a €2.65 million impact on the Group net loss in 9M10 (vs. €1.26 million in 9M09).

As at 30 September 2010, the Group had net financial debt of €10.90 million, compared with €10.11 million at 31 December 2009. Cash and cash equivalents totalled €17.19 million at the end of September 2010.

Working capital totalled €28.03 million at 30 September 2010, in line with the figure of €27.63 million registered as at 31 December 2009, and up in absolute terms compared with the figure at 30 September 2009 (€22.74 million), mainly owing to growth in inventory to meet delivery requests for the end of the year.


In the third quarter of 2010, Group revenues grew by approximately 28.5% over the same period in 2009, rising from €18.62 million to €23.93 million. This performance reflects the increase in orders acquired over the year and the upturn on some markets.

Again in 3Q10, the different sales mix led to a different gross profit margin: this was 51.2% of revenues in 3Q10, compared with 50.8% in 3Q09.

3Q10 EBITDA was positive at €1,206 thousand (with a 5.0% ratio to revenues), versus €20 thousand in 3Q09. The EBITDA performance was positively affected by the trend in revenues and the different gross profit margin, while operating costs rose compared with 3Q09.

EBIT in the third quarter of 2010 was €-860 thousand, with a resulting -3.6% margin on revenues, compared with €-1.82 million, with a margin of -9.8%, in 3Q09. The adverse effects on EBIT of PPA amounted to €877 thousand in 3Q10 and €741 thousand in 3Q09.

The pre-tax loss was €1.54 million, compared with a loss of €2.36 million in 3Q09, owing to the foreign exchange trend and the consequent exchange rate differences booked.

In 3Q10 the Group net loss amounted to €2.26 million versus €2.59 million in 3Q09.

The company informs the public that, in compliance with the requirements of the CONSOB (Italian securities & exchange commission), the Consolidated Interim Management Statement as at 30.09.10 is at the disposal of anyone who asks for it at the company's registered offices as well as at the offices of Borsa Italiana S.p.A.. The report is also available on Eurotech's website at the address

Pursuant to Article 154-bis, Paragraph 2, of the Italian Consolidated Finance Act (Legislative Decree 58/1998), the Financial Reporting Manager of Eurotech S.p.A., Sandro Barazza, herewith declares that the financial disclosure contained in this press release corresponds to documentary evidence, corporate books, and accounting records.


Eurotech (ETH.MI) is a global company based in Italy and with offices and subsidiaries in Europe, North America and Asia. The Eurotech group develops and markets miniaturised computers for special use (NanoPCs) and computers featuring elevated computing capacity (HPCs - High-Performance Computers). With these two product categories, Eurotech aims to become a leader in the implementation of the pervasive computing infrastructure commonly known as Cloud or GRID, capable of enabling an entire range of value-added services and functions in the transport, defence, industrial, medical and scientific-research sectors.







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