Jena, Germany - Jenoptik reports that, as expected, sales and earnings in the 1Q13 came in slightly below the high level of the previous year. The predicted weakness in the semiconductor industry continued in the quarter covered by the report.
"In addition to fluctuations during the year with a comparatively weak 1st quarter, changes in demand from the semiconductor industry do of course impact on the Group’s earnings but can be better compensated than still just a few years ago. The continued internationalization, improved cost structures, as well as the targeted development of projects with key customers had positive effects also in a challenging economic environment," states Jenoptik chairman Dr. Michael Mertin.
Jenoptik posted sales of 132M euros (~$173.2M) in the 1Q13, while the same period last year recorded 137.7M euros. The slight decline of 4.1% resulted from the continuing weakness in the semiconductor market and postponement of sales to subsequent periods. The Group continued its successful strategy of internationalization and generated 66% of sales abroad (previous year: 63%). There was a particularly strong rise of sales in America. The two growth regions of America and Asia/Pacific once again accounted for more than 30% of Group sales. In 2012, Jenoptik further expanded its sales and service structures, especially in these two regions. Since then, the international activities of the Group have been strengthened by new locations in Brazil, Malaysia, and Singapore.
As a result of the development of sales and due to the continued expansion of sales structures and expected higher R&D costs, the Group operating result (EBIT), at 10.6M euros, remained slightly below the level of the previous year (11.6M euros). The EBIT margin was 8.0% (prev. year: 8.4%). By contrast, the gross margin improved due partly to the cost reductions arising from the Jenoptik Excellence program as well as economies of scale in conjunction with major projects acquired.
Lower interest expenses led to an improvement in the financial result to -1.6M euros (prev. year: -1.7M euros). "On the one side, this development reflects the reduction in liabilities to banks but also the improvement in Jenoptik’s credit-worthiness," says Chief Financial Officer Rüdiger Andreas Günther. Income taxes amounted to 1.2M euros (prev. year: 1.4M euros). The earnings after tax totaled 7.9M euros (prev. year 8.4M euros).
At 132.M euros, the order intake was at precisely the same level as sales (prev. year: 148.8M). The order intake is subject to substantial fluctuations during the year due to major projects. In the first three months of the previous year, the order intake included among others the major order for traffic safety technology from Malaysia on a pro rata basis. Consequently, as expected, the order intake in the 1Q13 remained below the previous year‘s level (prev. year: 148.8M euros).
The order backlog of the Jenoptik Group as of March 31, 2013, at 447.5M euros, remained at the same high level of 446.8M euros as at the end of the year 2012.
As of the end of the 1Q13, the Jenoptik Group had 3,297 employees. Employees were recruited primarily in the Metrology segment.
As a result of the repayment of short-term financial liabilities, net debt as at March 31, 2013 was further reduced to the new figure of 72.0M euros (Dec. 31, 2012: 74.5M).
In April 2013, Jenoptik concluded a syndicated loan of 120M euros with a period of five years. "With this credit line with attractive terms we have not only created financial flexibility for future growth, but this also enabled us to establish an international core group of banks," said CFO Rüdiger Andreas Günther, commenting on the conclusion of the contract.
As a result of the profit achieved in the 1st quarter 2013, the shareholders’ equity quota of the Jenoptik Group once again rose above the 50% level to 50.4% (31.12.2012: 49.3%).
The development of the Lasers & Optical Systems segment was characterized by a cautious start due to the continuing weakness of the semiconductor market. At 49.7M euros, sales remained below the level for the previous year (prev. year: 57.2M euros) as a result of among other things the declining demand from this sector. The development of sales as well the investments in the future were reflected in the segment’s EBIT, which stood at 4.1M euros (prev. year: 8.9M euros). The order intake, at 52.2M euros, was at almost the same level as in the previous year (prev. year: 55.0M euros), slightly exceeded sales. The order backlog at 107.1M euros was also up slightly on the previous year (Dec. 31, 2012: 105.2M euros).
The 1Q13 was also a very successful one for the Metrology segment. Sales rose to 42.8M euros (prev. year: 37.2M). The increase was attributable on the one side to industrial metrology, which benefited from strong demand from the automotive industry as a result of the global trend towards fuel-saving and low-emission engines, and on the other side from traffic safety systems as a result of deliveries for major projects. The segment EBIT more than doubled to 6.5M euros (prev. year: 3.0M). The order intake, at 42.2M euros (prev. year: 58.9M), was below the high figure for the previous year, which had included among other things the major order for traffic safety technology from Malaysia. The order backlog, at 88.5M euros, was at the same level as at the end of 2012 (87.4M euros).
"With its products, the Group is benefitting from future-oriented megatrends in the areas of energy efficiency, security, health, mobility, as well as the increasing global digitization. For us, these trends, together with our innovative products, the successful continued implementation of our internationalization strategy, as well as more efficient internal structures form a key basis for our future profitable growth," said Mertin.
In 2013, Jenoptik intends to invest in the expansion of its sales structures and innovative products and optimize internal processes. In addition, Jenoptik is combining its optics manufacturing in North America at one site.
The Executive Board of Jenoptik reaffirms its forecasts for the fiscal year 2013. In challenging economic conditions, it expects to see slight growth in sales of up to 5%. Regional growth will come primarily from America and Asia/Pacific.
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