EQS-News: AT&S 2024/25 on growth course again
Source: EQS
AT&S 2024/25 on growth course again
Leoben – AT&S operated in a challenging market environment in the financial year 2023/24. After a strong second quarter, demand was relatively weak again in some market segments in the second half of the financial year. The markets for mobile devices and industrial applications softened significantly. While notebooks and PCs saw a slight recovery, the market for servers slowed down further. “We see AT&S return to growth in the new financial year 2024/25. The general market recovery expected in our industry for the second half of the financial year 2024/25 should also have a positive effect on demand and, consequently, utilization of our existing plants. Business growth will be supported by the ramp-up of high-volume production at our two new plants in
Compared with the record level of the previous year, consolidated revenue declined by 13% to € 1,550 million in the financial year 2023/24 (PY: € 1,791 million). Adjusted for currency effects, consolidated revenue decreased by 11%. This development was primarily driven by the fundamental changes in the economic environment. Due to a less favorable product mix and higher price pressure, revenue in the Electronics Solutions segment fell short of the strong figures of the previous year. Revenue in the Microelectronics segment declined slightly due to lower demand for servers. In this challenging environment, AT&S was able to defend its good market position.
EBITDA decreased by 26% from € 417 million to € 307 million in the financial year 2023/24. The reduction in earnings is primarily attributable to the decline in consolidated revenue. The negative effects of the currently difficult market environment were in part mitigated by the consistent implementation of the efficiency programs. As was the case with revenue, both segments were unable to match the EBITDA figures of the previous year. In the Electronics Solutions segment, EBITDA decreased by 32% to € 210 million (PY: € 310 million) due to lower revenue and a less favorable product mix. In the Microelectronics segment, EBITDA declined by 17% from € 116 million to € 96 million for similar reasons as well as due to higher start-up costs at the new plants in
Currency fluctuations had a positive influence of € 6.8 million on earnings. Adjusted for start-up costs in
The EBITDA margin amounted to 19.8% (EBITDA margin adjusted for start-up costs: 24.8%), thus falling short of the prior-year level of 23.3% (EBITDA margin adjusted for start-up costs: 26.2%).
Depreciation and amortization increased by € 5.9 million to € 276 million (17.8% of revenue) due to additions to assets and technology upgrades. EBIT declined from € 146 million to € 31 million. Finance costs – net fell from € 22 million in the previous year to € -50 million primarily due to changes in currency effects on cash and cash equivalents. Profit for the year decreased from € 137 million to € -37 million, leading to a decline in earnings per share, after interest for hybrid capital, by € 4.42 from € 3.03 to € -1.39.
Key figures
* Adjusted for start-up costs ** Incl. leased personnel, average. As at
The asset and financial position as of
Cash and cash equivalents declined to € 676 million (
Strategic decisions of Given the currently volatile market environment, the Management
In order to further sharpen the Group’s profile, AT&S intends to sell the plant in Ansan,
Against the backdrop of the currently challenging market environment and the ongoing investment programs, the Management Board will propose to the Annual General Meeting on
Expected market environment The expectations for AT&S’s segments are currently as follows: In the area of mobile devices, where overall market conditions are weak, demand is expected to recover only slightly; this segment will remain a challenge for AT&S. In contrast, the module printed circuit board business continues to develop positively.
Although the PCB market in the automotive segment is currently under pressure due to higher inventory levels in the supply chain, among other things, it is subject to a growth trend in the medium term, as the electronic content per vehicle continues to increase. In the Industrial segment, a slight recovery of the market is expected in 2024.
The market for notebooks is generally volatile and subject to significant quarterly fluctuations. In the markets for IC substrates, demand for notebooks in 2024 is expected to be slightly higher than in 2023. This should lead to higher demand for IC substrates since inventories have now normalized.
Since a growing share of investments in the server market is currently directed towards high-priced products focused on artificial intelligence, the reduction of inventories is proceeding more slowly than initially expected. Inventory levels should have normalized by the second half of the financial year 2024/25, and demand for server products is expected to pick up again. The most recent order planning of AT&S’s main customers also indicates such a development. Due to the expected change in architecture, the product mix should continue to change, with the trends towards technologically higher-end IC substrates also expected to continue; AT&S will benefit from this trend.
Outlook 2024/25 Some of the industries served by AT&S have stabilized over the past months. On this basis, demand is expected to recover in terms of volume, in particular in the second half of the financial year 2024/25. Nevertheless, the company assumes that strong price pressure will continue. The consistent implementation of and further focus on the already ongoing efficiency programs are intended to counter this pressure. In addition to comprehensive cost-cutting measures, a reduction of up to 1,000 employees will be implemented at the existing locations.
After the high investments of € 996 million in 2021/22 and € 855 million in 2022/23, net capex will decline significantly in the coming years. The management is planning investments of roughly € 500 million for the financial year 2024/25 depending on the market environment and progress of projects. The majority of these investments will be used for the IC substrate production at the new plants in
AT&S expects to generate annual revenue in the range of € 1.7 to € 1.8 billion in the financial year 2024/25[1]. Excluding effects from the start-up of the new production capacities in
Guidance 2026/27 “AT&S will grow with AI,” says AT&S-CEO
The production capacity expansion in
[1] Refers to the current company structure, including the plant in Ansan,
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Language: | English |
Company: | |
Fabriksgasse 13 | |
8700 Leoben | |
Phone: | +43 (1) 3842200-0 |
E-mail: | ir@ats.net |
Internet: | www.ats.net |
ISIN: | AT0000969985, AT0000A09S02 |
WKN: | 922230 |
Indices: | ATX |
Listed: | Regulated Unofficial Market in |
EQS News ID: | 1902039 |
End of News |
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1902039 14.05.2024 CET/CEST