Fujitsu Siemens Computers (FSC) has blamed the introduction of the Restriction of Hazardous Substances directive (RoHS) for its latest weakened financial results.
For the first half of 2006, FSC recorded 3.1bn euros in turnover and a pre-tax profit of 4m euros. In the first half of 2005, the vendor achieved 2.8bn euros in turnover. However, its pre-tax profit was a healthy 27m euros.
Bernd Bischoff, president of FSC, said: “We managed to assert our market position in a tough market environment. We are always prepared for a tough market and fluctuations in demand. We will be ready if the market develops better than expected.”
FSC blamed the results on a decline in average selling prices and margin pressure. The firm also claimed the introduction of RoHS had “a negative impact on business”.
The RoHS regulations were introduced on 1 July. They affect manufacturers, resellers, distributors and recyclers of electrical and electronic equipment (EEE). If new EEE is put onto the market that contains more than the permitted levels of certain substances, such as lead and mercury, fines are issued.
Derek Morgan, head of strategy at IT equipment recycling and remarketing firm CKS Group, said: “The real problem for FSC relates to its manufacturing processes and distribution policies. It may have allowed stock of non-compliant equipment to build up and then failed to clear this through the channel in time.
“The lesson for other manufacturers is clear. We are only just beginning to address environmental concerns associated with electronic equipment. Just-in-time and adaptable manufacturing will need to be backed up with lean distribution practices if this is not to be a frequent feature on future financial reports.”
Ian Gobey, commercial director at IT equipment recycler PC Disposals, said: “Vendors have been making allowances for the RoHS directive for some time, so you would expect them to be aware of the costs.”
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