First quarter 2018/19
AT&S starts financial year with revenue growth and significant improvement in earnings
- Investments of the past years bear fruit
- Very good demand for IC substrates
- Revenue of € 222.1 million, up 11.2% on the prior-year period
- EBITDA increases by 75.4% to € 52.0 million thanks to higher earnings from Chongqing and measurement effects
- EBITDA margin of 23.4%
- Management confirms outlook for 2018/19 at the upper end of the indicated range
Leoben, 07:05 pm – AT&S started the new financial year with increases in revenue and earnings. While the first quarter of the previous year was still marked by the start-up of the plants in Chongqing, revenue and earnings increased in the reporting period due to the additional capacities. Moreover, the current period reflects the efficiency improvement measures which were successfully implemented in the past quarters for the sites in Chongqing and Shanghai.
Revenue was 11.2% higher than in the comparative period and amounted to € 222.1 million (previous year: € 199.6 million). Based on higher contributions to earnings from Chongqing and one-off measurement effects, among other things due to the currency development – appreciation of the US dollar against the euro since the beginning of the financial year – EBITDA of € 52.0 million (previous year: € 29.7 million) was recorded, resulting in an unusually high EBITDA margin for the first quarter of 23.4% (previous year: 14.9%).
“We are highly satisfied with the current developments as they demonstrate that our investments in Chongqing in the past years are paying off and that we are pursuing the right strategy,” Andreas Gerstenmayer, CEO of AT&S, commented on the development in the first quarter. “Our current figures confirm that we have invested in the right technology. Despite the usual seasonality in our industry, the additional capacities in Chongqing are bearing fruit as expected. A better result in Chongqing and positive measurement effects supported the development in the first quarter,” said Gerstenmayer.
EBIT improved by € 21.7 million from € -3.4 million to € 18.3 million. The EBIT margin amounted to 8.3 % (previous year: -1.7%). Finance costs – net improved significantly from € -2.2 million to € 1.7 million due to optimisation measures and exchange rate effects.
Tax expense totalled € 6.5 million in the first three months (previous year: € 5.6 million). This minor increase in relation to earnings was due to a reduced tax rate at AT&S (China) Company Limited, which was higher in the prior-year comparative period since the certificate had not been granted yet.
Profit for the period rose from € -11.2 million to € 13.5 million due to the significant improvement in the operating result and finance costs – net. As a result, earnings per share increased from € -0.29 to € 0.30. Interest on hybrid capital of € 2.1 million (previous year: € 0.0 million) was deducted in the calculation of earnings per share.
Cash flow and statement of financial position
Equity rose from € 711.4 million to € 743.6 million. The increase resulted from the good profit for the period and positive exchange rate effects. The application of new accounting standards (IFRS 15) had an additional positive effect of € 10.4 million on equity.
Net debt rose slightly to € 214.1 million (31.03.2018: € 209.2 million). Cash flow from operating activities amounted to € 4.6 million in the first three months of 2018/19 (previous year: €-49.3 million). These cash inflows were offset by outflows for net CAPEX of € 17.1 million (previous year: € 69.7 million).
Gem. IFRS; (in Mio. EUR)
Konzern Umsatz 1.000,6 1188.2 18,8 %
EBITDA 194,5 245,7 26,3 %
EBITDA-Marge (in %) 19,4 20,7 -
EBIT 47,4 79,8 68,3 %
EBIT-Marge (in %) 4,7 6,7 -
Konzernergebnis 19,8* 47,7 >100%
Cashflow der lfd. Geschäftstätigkeit 185,1 184,7 (0,3 %)
Netto-Investitionen (Net CAPEX) 218,5 435,8 99,4 %
Eigenkapitalquote (in %) 41,0 33,6 -
Nettoverschuldung 246,7 508,5 >100 %
Ergebnis je Aktie 0,30 1,01 >100 %
* Anpassung Hedge Accounting Vorjahr
Mobile Devices & Substrates segment with clear revenue growth despite seasonality
In the first three months of the financial year, the segment benefitted from additional contributions to revenue and earnings from Chongqing, which was still partially in the start-up phase during the comparative period of the previous year. In addition, the segment generated positive effects from measures to improve efficiency at the Chinese sites in the current period. This gratifying development was supported, as described above, by measurement effects and the expansion of the product portfolio of IC substrates to include premium technology applications. Accordingly, the segment’s revenue rose by 16.6% year-on-year to € 160.2 million (previous year: € 137.3 million) and EBITDA even by 88.0% to € 39.3 million (previous: € 20.9 million).
Automotive, Industrial, Medical segment with stable revenue and increased earnings
The segment’s revenue, at € 89.6 million (previous year: € 89.6 million), remained at the level of the previous year. Strong demand was recorded especially in the Medical & Healthcare segment in the first quarter. The strong trend in the areas of autonomous driving and e-mobility leads to a growing share of electronics in the automotive industry and, consequently, to revenue growth in the medium term. Moreover, it is to be expected that Internet-of-Things applications will push through in all three segments, Automotive, Industrial and Medical.
Investments and financing
Investments in the range of roughly € 70 to 100 million are planned for maintenance and technology upgrades for current business activities. Depending on the market development, investments in capacity and technology expansion may increase by another € 100 million, with the technology expansion and capacity increase of high-frequency printed circuit boards in the area of autonomous driving at the sites in Nanjangud, India (near Bangalore) and Fehring, Austria (southeast Styria) currently being implemented.
AT&S confirms outlook
Based on a stable market and macroeconomic environment as well as stable exchange rates during the year, the management confirms revenue growth of up to 6% for the financial year 2018/19 and an EBITDA margin in the range of 20 – 23%. Due to the good development in the first quarter, at this stage AT&S expects to achieve the upper end of this range.