Johnson Electric Holdings Limited, headquartered in Hong Kong, has reported its business operations and finances for the three months ending June 30, 2022. The Group, which includes Powder Metallurgy parts maker Stackpole International, reported that sales were down 4% from the same quarter in 2021, at $840 million.
Foreign exchange rate movements had a negative effect of $37 million on the Group’s sales for the quarter. This was mainly due to the impact of weaker average exchange rates, especially for the Euro, but also for the RMB and Canadian Dollar against the US Dollar, compared to the same quarter in 2021.
The Automotive Products Group (APG) reported sales for the quarter ended 30 June, 2022 decreased by $20 million, or 3%, compared to the same quarter in 2021. Excluding currency effects and the acquisition of E. Zimmermann GmbH, APG’s sales increased by $9 million, or 1%, in the quarter. This increase in underlying sales compared to a 4% decrease in global light vehicle industry production volumes in the quarter.
On a regional basis, APG’s sales also fared better than automotive industry production volumes, which were constrained by shortages of semiconductors, in all regions during the quarter. The sales changes by region, excluding currency effects and the acquisition of Zimmermann, were decreases of 15% in the Americas; 7%, in Asia; and 2%, in Europe.
COVID-related factory lockdowns in China adversely affected sales of powertrain cooling and Powder Metallurgy products, although other areas – such as closure and water pumps – increased. In Europe, oil & water pumps, coolant valves and Powder Metallurgy parts were said to be strong, although sales of other products decreased due to a reduction in light vehicle production in the region. In the Americas, there was strength reported across many product lines.
The Industry Product Group’s sales for the quarter decreased by $17 million, or 8%, compared to the same quarter in 2021. Excluding currency effects, IPG’s sales decreased by $12 million, or 6%, in the quarter, with Asia reporting a decrease of 33%; Europe, of 7%; and the Americas, 16%.
Asia sales, which primarily represent goods invoiced to Asia-based OEMs and contract manufacturers whose end products are mostly destined to export markets, were said to have declined owing to the combination of supply chain disruptions caused by COVID lockdowns in China, ongoing shortages of semiconductor chips and other components, and a decline in demand for some ‘home-centric’ products that had experienced an exceptional surge in sales during the pandemic. In Europe, sales grew in the beverage and lawn segments and, in the Americas, in the medical, ventilation and white goods segments, due to increased demand.
“Despite external challenges, our business units continue to work collaboratively with customers to adjust prices to offset the surge in cost input increases experienced in the past year,” stated Dr Patrick Shui-Chung Wang, chairman and Chief Executive. “Our global operating footprint and geographically diverse sales mix also provides Johnson Electric with strong foundations to navigate further potential volatility in the macro economy.”