The Jungheinrich Group has finished the half-year with increased sales and level profits, despite a "sluggish market context" in recent months.

In Q2, ending June 30, Jungheinrich achieved sales of EUR358 million (USD406.6 million), up from EUR350 million (USD397.5 million) in Q2 2002.

Jungheinrich reported a 2% first-half sales increase of EUR716 million (USD813.2 million) over the 2002 tally of EUR702 million (USD797.3 million), of which 72% came from exports.

Net profits for the first half rose 8.4% to EUR18 million (USD20.4 million), from EUR16.6 million (USD18.9 million) in 2002. Orders received, affected by a poor showing in Q2, totalled EUR728 million (USD826.8 million) for the first half, down 3.8% from EUR756 million (USD858.6 million).

Jungheinrich's report said the transfer of IC forklift production from Leighton Buzzard, in the UK, to Moosburg, Germany, scheduled for completion by mid-2004, was advancing smoothly.

The company's Argentan production plant, run by subsidiary Mécanique Industrie Chimie (MIC) SA, came under fire in the report. "The company is not satisfied. In spite of considerable efforts, the plant in Argentan, which produces mainly hand pallet trucks, has not yet achieved its target of sustainable profitability," the report said.

"Measures for the long-term correction of the loss-making situation at MIC SA are being looked into. Merging MIC's sales with Jungheinrich's French sales organisation is also proving significantly (more costly) than anticipated."

Jungheinrich said there appeared to be no signs of improvement in the market. The company expected, at best, an "extensive stabilisation" of market volume in Europe.

"Under these conditions, it will be increasingly difficult to achieve the projected increases in returns in the second half of the year," the company said.