Continued pressure on margins has led SDax / Frankfurt-listed precision injection moulder Balda (Bad Oeynhausen / Germany; www.balda.de) to issue a profit warning, saying that it faces an operating loss (EBIT) “in the single digit range” in 2010, rather than the forecast profit of EUR 2.5m.

The company said that, based on preliminary results for the third quarter of 2010 it is not expected to achieve the forecasted figures in turnover and operating profit in this business year, although revenues will still reach the lower range of the predicted 10 - 15% increase. Profit before tax (EBT) is forecast to be positive, mainly due to the disclosed earnings contributions of Chinese touch screen joint venture TPK, in which Balda reduced its stake to 19.25% in March 2010 – see Plasteurope.com of 08.03.2010.

Balda said the low sales growth and reduction in the forecast operating result was due to both continued pressure on margins and the reduction of the scheduled customer orders until year-end 2010 in its “MobileCom” business in China. Orders from new customers, such as Samsung, for the mass production of plastic systems in the “MobileCom” business will not have an impact on revenues until the fiscal year 2011, Balda said.

The company’s shares fell by almost 20% on the announcement, having reached a 33 month high of EUR 7.98 on 13 October 2010, but recovered to close at EUR 6.61 on 18 October 2010.