Hoofddorp, Netherlands - 13 May 2009
Download Q1 2009 Report
Q1 revenues of €1.3 billion and EBITDA before specific items of €30 million.
€575 million in new business wins for the quarter (20% year on year increase).
Cross selling opportunities continue to increase with €116 million of new business in Q1.
CEVA Logistics, a leading global supply chain management company, today announced Q1 results for 2009 with revenues at €1.3 billion for the quarter (Q1 2008 €1.5 billion) and EBITDA before specific items of €30 million (Q1 2008 €72 million).
Key Financials at actual exchange rates
| EBITDA before specific items1
Key Financials at 2008 constant exchange rates
As we stated at the Full Year, our outlook for Q1 was impacted by the challenging market environment. The negative trends observed in Q4 continued into the first two months of Q1 in regard to EBITDA. However, we have seen an improvement in March over the first two months of the year in respect of both revenue and EBITDA. This is partly a result of an increase in production levels in the automotive market and the need for companies to restock the supply chain as inventory levels reduce.
The first quarter proved successful in terms of our new business wins. CEVA saw annualized wins in Q1 of €575 million which is a 20% YoY increase and our pipeline for the quarter has increased to €4.4 billion, an increase of €200 million YoY. We believe this increase is driven by additional opportunities presented in the current economic climate whereby companies look to further outsource and optimise their supply chain costs. Companies recognize that CEVA is a global supply chain provider who can manage the entire end to end supply chain needs. We saw the benefits of this cross selling approach result in annualized wins at the end of 2008 of €230 million and this figure has increased to €346 million at the end Q1. We expect to win a further share of the market as our current and potential customers seek integrated contract logistics and freight management solutions in the future, and believe we are well positioned from a service offering and organizational point of view to maximize these opportunities.
In addition, we remain focused on a number of cost containment and elimination programs to reduce direct costs and overheads. In total, we anticipate that these savings program will deliver over €100 million in incremental cost savings in 2009.
From a capital structure perspective we are in a robust position; only a limited amount of our debt is payable before the end of 2012. The increase in our debt position during Q1 is attributable to the strengthening of the US Dollar in the quarter, the impact being €83 million in Q1.
Cash generated by operations in the quarter amounted to €64 million (Q1 2008: €76 million) and was sufficient to meet our operating requirements and debt service obligations. We have also been able to repay some of our short term debt during the quarter.
Our strict control over capital expenditures has led to a slight reduction in spend in the quarter's expenditures to €18 million (Q1 2008: €19 million). Notwithstanding the slight YoY decrease, we will continue to fund capital expenditures, particularly to support existing and new business opportunities.
Whilst the last few months of trading have been challenging due to the ongoing business environment, we believe we are well positioned to succeed given our clear strategy, world class supply chain leaders and robust approach to delivering operations excellence.
1EBITDA excludes the impact of specific items which are significant non-recurring items such as restructuring and integration costs, rebranding, costs and certain legal expenses.
CEVA Group Marketing & Communications
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