OPERATING ENVIRONMENT

Published on 8 May 2012

Cencorp operates in industries applying electronics and renewable energy technology (Cleantech). Its main geographical market areas are Europe, North America, South America and Asia. Cencorp’s key customers for laser and automation applications operate globally and require local service. The global electronics industry, including the manufacture of mobile phones, is mostly concentrated in Asia, the domestic market area for the special components manufactured by Cencorp.

At the end of 2011, Cencorp’s automation and laser applications customers were carefully estimating the general development of the global economy. This resulted in a weaker demand for Cencorp’s products, as well as in a decrease in net sales in the first quarter of 2012, compared to the same period in 2011. Especially, deliveries of new machines were declined compared to the first quarter of 2011. However, demand for services related to the life cycle management of laser and automation systems and equipment offered by Cencorp continued to grow. According to the company estimate, the on-going uncertainty in the global economy and scarce financing for production line investments create a favorable environment for further developing the life cycle services, as stated in the company strategy.

In the special components business, Cencorp has clearly decreased the dependence on the demand of the customers operating in the telecom sector. In the first quarter of the year, the company has successfully launched two new products which will significantly grow the market potential available for Cencorp. In addition, the company is developing several products for the Cleantech business. The successful launch of these products will guarantee a remarkable growth potential for the company over the coming years.

The market for renewable energy applications  continued to grow, even though their share of the total energy applications market still remains minor. Cencorp has strengthened its position in this market. Cencorp is able to provide this industry sector with solutions based on both its laser and automation applications and special components product range.