3W Power: Group outlook to improve after restructuring implementation

By Caroline Salls

Pittsburgh, May 14 - 3W Power SA and subsidiary AEG Power Solutions said the financial outlook for the group is expected to improve after the full implementation of its financial and operational restructuring program.

According to a news release, management forecasts revenue of €220 million in 2014, €224 million in 2015 and more than €240 million in 2016.

Meanwhile, the company said EBITDA after extraordinary expenses is expected to increase to €17 million in 2015 from an expected negative €24 million in 2014 and to more than €20 million after 2015.

At the end of fiscal year 2014, the company expects to have roughly €20 million of liquidity.

"While we have made a lot of progress in our restructuring efforts in a very short time and are confident that we are on the right path, we will now focus on restoring confidence with our business partners," board chairman Dick Wolfertz said in the release.

AEG chief restructuring officer Jeffrey Casper said in the release "With the continued stability in our core end markets, I believe we can create a solid base to provide best in class products, services and solutions to our customers around the world.

"In doing that, profitability and sustainable cash-flow generation will remain key priorities for the company."

In the first three months of 2014, the group completed several major actions related to its global financial and operational restructuring program.

Specifically, 3W Power said the POC module business was sold to Advanced Energy Industries. The net capital gain of the sale of the modules is €20.9 million, offset by an additional €2.6 million write-off in capitalized R&D projects.

In addition, the group's affiliate in Bangalore, India, was sold to Toshiba Mitsubishi-Electric Industrial Systems Corp., and 3W Power South Africa was sold to ACI SA.

The group's telecom converter business based in Lannion, France, was placed into administration and was de-consolidated from the group, the release said.

3W Power reported €8.7 million in EBITDA for the quarter ended March 31 on €45.4 million in revenue. In comparison, the company posted €6.7 million of EBITDA for the first quarter of 2013 on €94.4 million in revenue.

As of March 31, the group maintained €35.8 million in cash and cash equivalents.

3W is the holding company for AEG Power Solutions, a Zwanenburg, the Netherlands-based provider of power electronics systems and solutions for industrial power supplies and renewable energy applications.

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