Ascom expects a loss at Group level for the first half of 2016
Ascom is expecting an overall loss at Group level for the first half of 2016, but is confident that the operating result will be considerably better in the second half of the year.
The Network Testing Division continues to suffer from a difficult market environment and expects to incur a loss at EBITDA level in the mid-single-digit million range (in CHF) for the first half of the year, reflecting a decline in revenues compared to the same period of the prior year. Network Testing is confident to achieve a markedly better result and to return to profitable growth in the second half of the year.
The Wireless Solutions Division is expecting a flat revenue performance for the first half of the year, which is impacted by the adverse effect of a temporary drop in volume demand in its OEM channel. Given this development - as well as the investments made in connection with the transformation of the Company into a solutions provider - the Wireless Solutions Division's profitability for the first half of 2016 will be lower than in the same period of the prior year.
As previously announced, Wireless Solutions is expecting a significantly stronger result for the second half of the year due to the seasonal nature of its business. The solid order backlog and strong sales pipeline support this positive view. From today's perspective, the healthcare business (around 60% of the Division's revenues) is expected to report overall double-digit growth in 2016.
Holger Cordes will assume his new role as Ascom CEO on 1 June 2016 and will continue to move ahead with the implementation of the Ascom Group strategy. Upon completion of the evaluation of strategic options for the Network Testing Division, Ascom will align itself as a one-business company, as already announced, with a clear focus on healthcare ICT. The organization and administration will be streamlined and further aligned with customer needs. As the former COO of Cerner for Europe and Latin America, Holger Cordes has an impressive track record and the necessary experience to implement the "Ascom 2020" strategy efficiently. He will be presenting the next steps in the strategy implementation as well as Ascom's targets at the half-year results conference to be held on 17 August 2016.