Circuit breaker maker up in Q1

Schneider Electric SA, the world's biggest maker of circuit breakers, said first-quarter revenue gained 11 percent, bolstered by emerging-market expansion and demand for energy-saving products.

Sales increased to 4.31 billion euros compared with 3.89 billion euros a year earlier, the Rueil-Malmaison, France-based company said yesterday.

Schneider, whose auto-mation controls help to bottle Veuve Clicquot champagne, has shifted its focus to supplying data centers, water treatment plants and hospitals to help compensate for a slowdown in residential building markets.

Emerging markets, such as China, Latin America and the Middle East, accounted for almost a third of sales last year, from about a quarter in 2004, thanks to acquisitions and relocating production from Europe.

'Two engines'

"Our performance is fueled by our two engines for growth: broad exposure in emerging countries and unique positioning in energy efficiency," Chief Executive Officer Jean-Pascal Tricoire said in a statement issued yesterday.

Schneider, which raised its sales growth target three times last year, reiterated a forecast for like-for-like revenue growth of 6 to 8 percent in 2008.

Earnings before interest, taxes and amortization should equal 15 percent of sales from 14.8 percent last year.

The French company has slipped 7.5 percent in Paris trading this year, giving it a market value of more than 21 billion euros.

Eaton Corp, a US hydraulics maker that's expanding in electrical systems, has fallen 9.3 percent.

Eaton on April 14 reported a 5.6 percent gain in quarterly sales and raised its full-year profit forecast.

CEO Tricoire is steering the company away from heavy-duty industrial gear into the faster-growing and more profitable market of energy-saving products as rising power costs prompt businesses to invest in equipment to reduce consumption.

Beneficial purchase

The $6.1 billion purchase in 2007 of American Power Conversion Corp doubled sales of surge protectors and emergency power systems.

Schneider's controls help regulate production lines for drugmaker GlaxoSmithKline Plc, while its building systems monitor lighting and heating at San Francisco International Airport and in Carrefour SA supermarkets.

With the outlook for construction markets deteriorating, Schneider is probably still working out a solid backlog of non-residential projects, Exane BNP Paribas analyst Olivier Esnou said in an April 18 note.

Spending on US building projects fell in February for a fifth consecutive month as the housing recession dragged on and construction of offices and utility plants declined, the Commerce Department said April 1.

Agencies

(China Daily 04/22/2008 page16)