Danfoss A/S: Half-year Report 2011
29 August 2011
“In the first half of 2011, we maintained our progress improving profitability and achieving growth rates which, despite a more steady development, are still at a historically high level. The BRIC markets and the demand for climate and energy solutions, together with our strategic initiatives, continued to be the most important drivers behind the historically strong result.
As expected, the growth rates receded throughout the half-year, approaching a more normalized level. Meanwhile, the increasing unrest on the financial markets has fuelled the uncertainty on the world market and has reduced visibility. It continues to be uncertain as to what extent the financial unrest will result in real economic recession, but we expect the global growth to be at a markedly lower level for some time onwards. Despite this development and in light of the strong first half-year, we maintain our expectations for net sales and earnings for the year.
The half-year is particularly affected by the strategically important divestitures of Danfoss Geared Motors and Danfoss Water Controls, which generated 600 million DKK and which gives us the opportunity to concentrate more on our core business. At the same time, we make an extraordinary provision of 720 million DKK for the competition case concerning Danfoss Household Compressors as we estimate that a sanction of this size will be a realistic outcome of the case, based on our internal investigations.
With the sound half-year result on our hands, we are well prepared for the coming period that in light of the global financial unrest looks increasingly sinister and unpredictable.”
Niels B. Christiansen
President & CEO