Unaxis hammered by economic downturn

Unaxis has already implemented cost-cutting measures Keystone Archive

The downturn in the information technology market and the deteriorating global economic situation has hit the Unaxis technology group hard.

This content was published on November 5, 2001 - 10:16

Orders in the third quarter fell by 30 per cent to SFr312.6 million ($191.66 million) and sales declined by 20 per cent to SFr457.4 million, compared to the previous quarter.

Unaxis, the former Oerlikon-Bührle, said in a statement that comprehensive measures for sustainable cost reduction had been introduced.

The group said if the results of the semi-conductor machinery manufacturer ESEC were included in the results, a corporation-wide operating loss looked likely. Unaxis has a 56.8 per cent stake in ESEC.

However, Unaxis said it anticipated a "positive" net income for the 2001 financial year.

The company said that because of the unusually dramatic downturn in the information technology market, Unaxis was assuming that the related weakness in demand would continue "far into the coming year".

It added that comprehensive measures aimed at structural and capacity adjustments were expected to bring savings of more than SFr100 million.

In its outlook for 2002, Unaxis said it foresaw sales weakness persisting in the first and second quarters. For the year as a whole, an overall decrease in sales on a comparable basis was expected.

However, the statement said that Unaxis was anticipating that the operating result from current activities would be positive.

The company added that as a result of significant investments being made and the continuation of product development activities, Unaxis would be positioned at the forefront of the next recovery in the information technology markets.

A separate statement from ESEC headquarters in Cham in central Switzerland said that sales in the third quarter plummeted by 51 per cent compared with the previous quarter to SFr26.8 million.

As a result, revenues for the first nine months were some 66 per cent less than the comparable last year, totalling SFr167.6 million.

The statement said the decline in revenues reflected the deep cyclical downturn in the semiconductor industry and persistent weakness in demand.

Chip manufacturers continued to feel compelled either not to follow through on planned orders or to cancel existing ones outright, the statement added.

Looking ahead, ESEC said it expected demand to stabilise at low levels over the coming months and that cyclically related weakness would likely continue "far into 2002".

However, the company said that in the long-term, it remained confident that it was well positioned in the marketplace to benefit sustainably from a future recovery in demand.

swissinfo with agencies

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