LEM Lifts Sales Guidance on Solid Q3 Performance

LEM Holding Lifts Sales Forecast Amid Demand Stabilization

Swiss sensor manufacturer LEM Holding has increased the lower end of its full-year sales guidance following robust third-quarter results. The company cited stabilizing demand, with a book-to-bill ratio of 0.93 for the quarter and 0.99 for the first nine months of the fiscal year.

Operational and Financial Highlights

For the first nine months, sales grew 0.2% at constant currency but declined 5.4% on a reported basis due to the weakness of the Chinese yuan and U.S. dollar. The gross margin remained stable at 39.8%. The company's 'Fit-for-Growth' program is nearly complete, contributing to a 12.8% reduction in SG&A expenses and a 24.6% drop in R&D spending year-over-year.

Updated Outlook and Growth Drivers

Reflecting this performance, LEM raised its fiscal year 2025/26 sales guidance to a range of CHF 275-290 million, up from the previous floor of CHF 265 million. The high single-digit EBIT margin target remains unchanged. Key growth is coming from the Automation and Energy Distribution segments, boosted by data center applications.

Summary

LEM's revised guidance indicates growing confidence in its operational strategy and market position, despite continued pricing pressure in China. The focus now shifts to sustaining momentum in high-growth sectors and managing regional market dynamics.

FAQ

Q: Why did LEM Holding raise its sales guidance?
A: LEM raised its guidance due to solid Q3 results, normalizing demand indicated by a book-to-bill ratio near 1.0, and significant cost savings from its restructuring program.

Q: Which business areas are driving LEM's growth?
A: The Automation and Energy Distribution & High Precision segments are the primary growth drivers, particularly from applications related to data centers, such as cooling and power supply infrastructure.

Source: Investing.com