Hagemeyer reported revenue of 1,580 million for the third quarter 2006. Organic revenue growth was 12.1%, of which more than 60% resulted from mostly copper-related price increases.
The effect of acquisitions and divestments led to an increase of revenue of 12 million, driven by acquisitions of Cardi in Sweden and a fully owned subsidiary in Poland. This was partly offset by divestments in PPS USA and in the ACE business.
Organic growth for the PPS business was 12.3%; Europe and Asia-Pacific were the main contributors to this growth. In ACE activities, organic growth was 8.9%.
Overall growth in Europe was 14.8% and Asia-Pacific, 13.8%.
In North America, organic growth for the third quarter was 5.2%. Organic growth in the U.S. decreased from 14.4% in second quarter 2006 to 5.3% in the third quarter. This decrease was caused by a combination of several factors. The high growth rates in first quarter 2006 (15.1%) and in the second quarter were caused by the impact of several large integrated supply contracts which came on stream as of third quarter 2005. Growth in the first half of the year was also boosted by a very large construction project in the Southeast, which was completed in the second quarter.
Hagemeyer reported: “Our third quarter 2006 growth rate came under pressure as a result of an increasingly difficult comparison basis, a number of industrial customers reducing their level of activity and a marked slowdown in residential construction. Copper-related price increases have a minor impact on our U.S. business. We expect the U.S. market to show some further signs of weakness during the rest of the year. Our comparison basis versus last year will also become increasingly difficult. In spite of this tougher environment, we expect our U.S. operation to further improve its underlying operational performance.”
In Mexico, growth was robust in the industrial market. Growth in Canada slowed down in third quarter as a result of the completion of a large construction project in the oil and gas sector.
Growth in Asia-Pacific was impacted by copper-related price increases, and strong growth in small and medium-size customer segment. Unprofitable contract wound down in large installer and large project segment.
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