New G10-SiC system generation already largest driver of orders in the quarter
Gross margin increased due to improved product mix
Herzogenrath, Germany, October 27, 2022 – AIXTRON SE (FSE: AIXA, ISIN DE000A0WMPJ6), a leading provider of deposition equipment to the semiconductor industry, reported a significant year-over-year increase in order intake in the third quarter of 2022. The unabated strong demand for systems for the production of efficient power electronics based on gallium nitride (GaN) and silicon carbide (SiC), as well as from the areas of lasers and micro LEDs, ensure a continued strong order situation.
In the first nine months of 2022, revenues increased by 13% year-on-year to EUR 279.9 million. Operating result (EBIT) improved by 16% year-on-year to EUR 47.6 million, with an EBIT margin of 17%.
Due to the good business development in the first nine months and in view of the continued very positive assessment of the development of demand and product mix, the Executive Board is upgrading the growth guidance for fiscal year 2022.
Overall, the current global crisis situations and market developments continue to have only a minor impact on our business. Logistics and supply chains are tense, but in our view remain stable overall.
Strong order intake
Order intake in the first nine months of 2022 increased by around 13% year-on-year to EUR 425.6 million (9M/2021: EUR 377.6 million). This reflects the continued high demand across almost all end markets. In the third quarter, order intake of EUR 142.8 million significantly exceeded the level of the prior-year quarter (Q3/2021: EUR 114.2 million) and the recently launched G10-SiC system has already accounted for the largest share of total orders in the quarter. The development of order intake reflects the consistently high demand for efficient power electronics based on GaN and SiC as well as for micro LEDs.
As of September 30, 2022, the equipment order backlog amounted to EUR 369.4 million compared to EUR 267.6 million as of the previous year's reporting date and EUR 314.4 million as of June 30, 2022.
Power electronics on the rise
Revenues of the MOCVD world market leader improved by 13% year-on-year to EUR 279.9 million in the first nine months of 2022 (9M/2021: EUR 248.1 million). Revenues in the third quarter of 2022 were EUR 88.9 million (Q3/2021: EUR 130.8 million; Q2/2022: EUR 102.5 million).
The difference compared to the same quarter of the previous year is mainly due to a few customer-related delivery delays and the granting of export licenses, which were not yet available as of the reporting date. Due to unabated strong demand and stable supply chains, the Executive Board expects exceptionally high shipments in the fourth quarter of 2022 and thus a significant increase in revenues. In the third quarter of 2022, deliveries of equipment for the manufacture of GaN and SiC power electronics accounted for the largest contribution to revenues with a share of more than 50%. Sales of systems for the manufacture of lasers, in particular for optical data transmission and 3D sensor technology, were strong as well.
Gross margin increased in the third quarter due to improved product mix
Compared to the previous year, gross profit in the first nine months of 2022 increased by 12% to EUR 113.1 million with a gross margin of 40% (9M/2021: EUR 101.4 million; 41%). Gross profit in Q3/2022 was EUR 39.3 million with a gross margin of 44%, (Q3/2021: EUR 56.3 million; 43%). The increase in gross margin mainly results from the changes in the product mix.
Operating expenses of EUR 65.4 million increased slightly in the nine-month period (9M/2021: EUR 60.3 million). Higher variable compensation components and lower R&D grants contributed to this increase. In the third quarter 2022, operating expenses increased year-on-year to EUR 23.1 million (Q3/2021: EUR 20.1 million).
Operating profit (EBIT) improved to EUR 47.6 million in the first nine months compared to EUR 41.1 million in the same period of the previous year, with an EBIT margin of 17% (9M/2021: 17%). The increase was mainly due to higher revenues and the related gross margin as well as the business and cost development described above. In the third quarter, EBIT amounted to EUR 16.2 million (Q3/2021: EUR 36.2 million) with an EBIT margin of 18% (Q3/2021: 28%).
The AIXTRON Group's net profit increased in 9M/2022 to EUR 50.2 million (9M/2021: EUR 42.9 million). In the third quarter 2022, it amounted to EUR 19.1 million (Q3/2021: EUR 31.4 million). Earnings per share increased accordingly to EUR 0.45 in the first nine months 2022 and EUR 0.17 in the third quarter (9M/2021: EUR 0.39; Q3/2021: EUR 0.28).
Strong financial position
Free cash flow amounted to EUR 19.0 million in the first nine months of 2022 (9M/2021: EUR 27.1 million). This development is mainly due to the high cash inflow from receivables and the simultaneous build-up of inventories in preparation for exceptionally high shipments in the fourth quarter. In the third quarter of 2022, free cash flow of EUR (7.5) million was significantly higher than in the same quarter of the previous year (Q3/2021: EUR (19.0) million). The difference is mainly due to higher advance payments from customers.
Cash and cash equivalents including financial assets amounted to EUR 339.2 million as of September 30, 2022 (December 31, 2021: EUR 352.5 million). This is mainly due to the dividend payment of EUR 33.7 million in May 2022.
The high equity ratio of 75% as of September 30, 2022 (December 31, 2021: 80%) underlines AIXTRON's financial strength.
The number of employees in the Group increased to 842 as of September 30, 2022, which means that the structural strengthening of the organization for further growth is well on track.
2022 growth guidance upgraded
Due to the good business development in the first nine months and in view of the continued very positive assessment of the development of demand and product mix, the Executive Board is upgrading the growth guidance for fiscal year 2022.
For the full year, it now expects order intake in a range between EUR 540 million and EUR 600 million (previously: between EUR 520 million and EUR 580 million). With revenues in an unchanged range between EUR 450 million and EUR 500 million, the Executive Board now expects to achieve a higher gross margin of approximately 42% (previously: approximately 41%) and an EBIT margin of now approximately 22% to 24% (previously: approximately 21% to 23%).
As before, the expectations for 2022 are subject to the provision that the current challenging environment or special market developments continue to have no significant impact on the development of the business.
"We are very pleased with the success of our recently launched G10-SiC and expect similar success for the upcoming launches of our new system generations," says Dr. Felix Grawert, CEO and President of AIXTRON SE. "The increasing share of fully automated systems also shows the strong demand for new technologies, which confirms us in our chosen path."
"The increase of our 2022 guidance in this challenging environment is the result of rising demand for our pioneering technologies," commented Dr. Christian Danninger, CFO of AIXTRON SE. "Our strategic initiatives regarding product development and supply chain management are taking effect."
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Key Financials |
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|
|
|
+/- |
|
|
|
|
|
+/- |
|
in EUR million |
|
9M 2022 |
|
9M 2021 |
|
% |
|
Q3 2022 |
|
Q3 2021 |
|
% |
|
Order intake |
|
425.6 |
|
377.6 |
|
13% |
|
142.8 |
|
114.2 |
|
25% |
Order backlog
(Equipment only) |
|
369.4 |
|
267.6 |
|
38% |
|
369.4 |
|
267.6 |
|
38% |
|
Revenue |
|
279.9 |
|
248.1 |
|
13% |
|
88.9 |
|
130.8 |
|
-32% |
|
Gross profit |
|
113.1 |
|
101.4 |
|
12% |
|
39.3 |
|
56.3 |
|
-30% |
|
% |
|
40% |
|
41% |
|
-1pp |
|
44% |
|
43% |
|
1pp |
|
EBIT |
|
47.6 |
|
41.1 |
|
16% |
|
16.2 |
|
36.2 |
|
-55% |
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% |
|
17% |
|
17% |
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0pp |
|
18% |
|
28% |
|
-10pp |
|
Net result |
|
50.2 |
|
42.9 |
|
17% |
|
19.1 |
|
31.4 |
|
-39% |
|
% |
|
18% |
|
17% |
|
1pp |
|
21% |
|
24% |
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-3pp |
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Earnings per share (EUR) |
|
0.45 |
|
0.39 |
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15% |
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0.17 |
|
0.28 |
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-39% |
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Free cash flow |
|
19.0 |
|
27.1 |
|
-30% |
|
-7.5 |
|
-19.0 |
|
61% |
Financial information
The complete financial tables of the Group (income statement, other comprehensive income, balance sheet, cash flow statement and statement of changes in equity) relating to this press release are available as part of the
Group's Quarterly Statement Q3/2022 at:
www.aixtron.com/en/investors/publications
Investor conference call
In conjunction with the release of the third quarter 2022 results, AIXTRON will host a conference call (in English) for analysts and investors on Thursday, October 27, 2022, at 15:00 CEST (06:00 a.m. PDT, 09:00 a.m. EDT). You can dial into the conference from 14:45 CEST (05:45 a.m. PDT, 08:45 a.m. EDT) on the following telephone number: +49 (30) 23 25 31 173 or +1 (516) 269-8974.
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