Half-year report 2016: Growth drives strong first half-year at Danfoss

Ending Q1 on a good note, the Danfoss Group had an even better Q2, delivering a strong half-year with an increasing top-line and significantly improved earnings. In the first half-year, the Group’s total net sales increased to DKK 19.4bn against DKK 19.2bn in the same period last year, which corresponds to 4% growth in local currency. The operating profit (EBIT) improved by 18%, ending on DKK 2.2bn.

“We are very pleased with our first half-year, where growth drove our improved earnings. We are beginning to see the impact from our targeted growth initiatives, investments in innovation and our continued focus on our competitiveness reflecting a positive development in our market share. In combination, this makes us capable of investing further in our growth initiatives and our digital transformation, in particular,” says President & CEO Niels B. Christiansen.
A key reason for the improved results was progress in Danfoss’ largest markets, including Europe and China, where the need for energy efficiency and more climate-friendly solutions drove the sales increase. All of the Danfoss Group’s four business segments increased net sales in local currency during the first six months. Danfoss Cooling and Danfoss Heating, in particular, lifted the sales and delivered significantly improved earnings.

“Our businesses hold really strong positions in the market, and we see positive trends in some of our biggest markets. Smart and efficient energy systems are increasingly being placed high on the agenda across the globe, and this has a positive effect on the demand for the innovative technologies we deliver,” says Niels B. Christiansen.

Financial key figures in the first half-year 2016:

• Net sales reached DKK 19.4bn compared to DKK 19.2bn in the same period last year, which
  corresponds to growth of 4% in local currency.
• The operating profit (EBIT) was DKK 2.2bn compared to DKK 1.9bn in the same period last year, which
  corresponds to growth of 18%. The EBIT margin was 11.4% compared to 9.7% in the same period last
  year.
• The free cash flow before M&A was DKK 976m compared to DKK 686m last year.

Expectations for 2016 maintained:
We expect to maintain or expand our market share and maintain the EBIT margin at 2015 level.

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