Quarterly Report • Jul 27, 2016
Quarterly Report
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| Change | ||||
|---|---|---|---|---|
| EARNINGS DATA AND GENERAL INFORMATION Revenue |
Unit | Q1 2015/16 194.4 |
Q1 2016/17 178.9 |
in % (8.0%) |
| € in millions | ||||
| thereof produced in Asia | % | 80% | 79% | – |
| thereof produced in Europe | % | 20% | 21% | – |
| Cost of sales | € in millions | 152.6 | 169.4 | 11.0% |
| Gross profit | € in millions | 41.8 | 9.4 | (77.4%) |
| Gross profit margin | % | 21.5% | 5.3% | – |
| EBITDA | € in millions | 45.5 | 18.8 | (58.6%) |
| EBITDA margin EBITDA adjusted1) |
% | 23.4% | 10.5% | – |
| EBITDA margin adjusted1) | € in millions | 45.2 | 38.1 | (15.8%) |
| % | 23.3% | 21.9% | – | |
| EBIT | € in millions | 23.8 | (9.2) | (>100%) |
| EBIT margin EBIT adjusted1) |
% | 12.3% | (5.1%) | – |
| EBIT margin adjusted1) | € in millions | 25.7 | 19.1 | (25.5%) |
| % | 13.2% | 11.0% | – | |
| Profit for the period | € in millions | 19.6 | (13.6) | (>100%) |
| Profit for the period attributable to owners of the parent company ROE (Return on equity)2) |
€ in millions | 19.6 13.0% |
(13.6) (9.7%) |
(>100%) – |
| ROCE (Return on capital employed)2) | % | 10.8% | (3.7%) | – |
| ROS (Return on sales) | % | 10.1% | (7.6%) | – |
| Cashflow from operating activities (OCF) | % | 37.7 | (11.8) | (>100%) |
| Net CAPEX | € in millions | 40.3 | 66.3 | 64.4% |
| Employees (incl. leased personnel), end of reporting period | € in millions | 8,539 | 9,222 | 8.0% |
| Employees (incl. leased personnel), average | – | 8,390 | 9,165 | 9.2% |
| – | ||||
| BALANCE SHEET DATA | 31 Mar 2016 | 30 Jun 2016 | ||
| Total assets | € in millions | 1,344.7 | 1,488.4 | 10.7% |
| Total equity | € in millions | 568.9 | 553.5 | (2.7%) |
| Equity attributable to owners of the parent company | € in millions | 568.9 | 553.5 | (2.7%) |
| Equity ratio | % | 42.3% | 37.2% | – |
| Net debt | € in millions | 263.2 | 342.4 | 30.1% |
| Net gearing | % | 46.3% | 61.9% | – |
| Net working capital | € in millions | 88.4 | 99.6 | 12.7% |
| Net working capital per revenue | % | 11.6% | 13.9% | – |
| STOCK EXCHANGE DATA | Q1 2015/16 | Q1 2016/17 | ||
| Shares outstanding, end of reporting period | – | 38,850,000 | 38,850,000 | – |
| Weighted average number of shares outstanding | – | 38,850,000 | 38,850,000 | – |
| Earnings per shares outstanding end of reporting period | € | 0.50 | (0.35) | (>100%) |
| Earnings per average number of shares outstanding | € | 0.50 | (0.35) | (>100%) |
| Market capitalisation, end of reporting period | € in millions | 504.7 | 419.2 | (16.9%) |
| Market capitalisation per equity3) | % | 84.0%4) | 75.7% | – |
1) Adjusted for Chongqing project.
2) Calculated on the basis of average values.
3) Equity attributable to owners of the parent company.
4) Calculated on the basis of the Equity as of 30 June 2015.
22ND ORDINARY ANNUAL GENERAL MEETING At the 22ndOrdinary General Meeting of AT & S Austria Technologie & Systemtechnik Aktiengesellschaft (AT&S) on 7 July 2016, held after the end of the reporting period on 30 June 2016, a dividend of € 0.36 per participating no-par value share was adopted for the financial year 2015/16. Ex-dividend day was 26 July 2016 and dividend payment day is 28 July 2016.
At the Annual General Meeting, the members of the Management Board and the Supervisory Board were granted discharge for the financial year 2015/16.
In accordance with the proposal of the Management and Supervisory Board, the remuneration for the Supervisory Board for the business year 2015/16 has been determined at an amount of € 437,200 in the aggregate. This remuneration will be paid out in the financial year 2016/17 for the preceding financial year 2015/16.
PwC Wirtschaftsprüfung GmbH, Vienna, was appointed auditor and group auditor for the financial year 2016/17.
Moreover, the Articles of Association were amended with respect to the term of office of Supervisory Board members and the by-election for resigning Supervisory Board members.
Furthermore, in accordance with the proposal of the Supervisory Board, the Annual General Meeting resolved to re-elect Georg Riedl, Regina Prehofer and Karin Schaupp to the Supervisory Board of the company until the end of the Annual General Meeting which decides on the discharge of the financial year 2018/19.
In the course of the Annual General Meeting it was announced that the mandates of the Management Board members Andreas Gerstenmayer, CEO, Karl Asamer, CFO and Heinz Moitzi, COO have been prolongated for five years - prior to maturity - until 31 May 2021.
SUPERVISORY BOARD As disclosed under "22nd Ordinary Annual General Meeting", the Annual General Meeting adopted a resolution to re-elect Georg Riedl, Regina Prehofer and Karin Schaupp to the Supervisory Board of the company. The term of office runs until the end of the Annual General Meeting which decides on the formal approval of the financial year 2018/19, hence in principle until the 25th Ordinary Annual General Meeting in the year 2019.
After the oil price had temporarily dropped to the lowest level in many years during the first calendar quarter of the year, it started to increase again in the second calendar quarter (first quarter of the AT&S financial year), which also had a positive effect on the share price developments in the international financial markets. In contrast, the uncertainties about whether the United Kingdom would stay in the European Union slowed down the development. The result of the referendum in favour of leaving (Brexit) led to severe turbulence in all relevant international financial markets.
While the US lead index, the Dow Jones Industrial (DJI), recorded an increase by 1.4% in the first quarter of the AT&S financial year, Europe's stock benchmark, the Euro Stoxx 50, fell by 4.7% during the same period. Austria's lead index ATX exceeded 2,000 points again after briefly dropping below this mark at the end of June. However, it still closed the quarter with a loss of 7.7%. The broader-based ATX Prime lost 7.4%.
PERFORMANCE AND LIQUIDITY OF THE AT&S SHARE On the Vienna Stock Exchange the AT&S share started the first quarter of the financial year 2016/17 at a price of € 13.00 and reached its high of € 13.43 in early April. In the course of the quarter the share price declined, reaching a low of € 9.60 on the day after the Brexit referendum. During the last trading days of the quarter, the share price rose again and the share closed at € 10.79 on 30 June 2016, which corresponds to a 16.4% decline during the reporting period.
Traded at a daily average volume of 73,730 shares on the Vienna Stock Exchange, the AT&S share slightly exceeded the level of the previous year (73,428 units). In contrast, the average trading turnover declined from € 1,082,899 to € 838,892 due to the low share price.
In the first quarter, AT&S again carried out a comprehensive programme of road shows and conferences in the relevant European financial centres such as Frankfurt, London and Zurich. These activities were complemented by a number of talks with analysts, and institutional and private investors. Within the scope of these contacts, existing and potential investors were informed about the development at the new plants in Chongqing and the trends in the core business.
AT&S is currently covered by analysts of eight investment banks, whose ratings included three "buy" and five "hold" recommendations.
| 30 June 2016 | 30 June 2015 | |
|---|---|---|
| Earnings per share | (0.35) | 0.50 |
| High | 13.43 | 15.99 |
| Low | 9.60 | 12.99 |
| Close | 10.79 | 12.99 |
| Vienna Stock Exchange | ||
|---|---|---|
| Shares outstanding | 38,850,000 | |
| Security ID number | 969985 | |
| ISIN-Code | AT0000969985 | |
| Symbol | ATS | |
| Reuters RIC | ATSV.VI | |
| Bloomberg | ATS:AV | |
| Indices | ATX, ATX GP, WBI, VÖNIX |
| 03 November 2016 | Results for the first half-year 2016/17 |
|---|---|
| 31 January 2017 | Results for the first three quarters 2016/17 |
| 09 May 2017 | Annual results 2016/17 |
| 26 June 2017 | Record date Annual General Meeting |
| 06 July 2017 | 23rd Annual General Meeting |
Elke Koch Phone: +43 (0)3842 200-5925 Email: [email protected]
BUSINESS DEVELOPMENTS AND SITUATION As expected, AT&S started the financial year 2016/17 with lower revenue than in the comparative period of the previous year. Revenue declined by € 15.5 million or -8.0% from € 194.4 million to € 178.9 million. This decrease results from lower seasonal demand for printed circuit boards for mobile devices, which is usual in the first three months; however, demand is still at a similarly high level as in the last three months of the past financial year. IC substrates generated the first revenues. The Automotive, Industrial, Medical segment increased its revenue slightly. The activities of the business unit Advanced Packaging, which are included in the Others segment, recorded a slight decline. Negative currency developments had little influence on revenue. The share of products manufactured in Asia declined slightly from 80% in the previous year to 79% in the current financial year.
| € in millions (unless otherwise stated) | Q1 2016/17 | Q1 2015/16 | Change in % |
|---|---|---|---|
| Revenue | 178.9 | 194.4 | (8.0%) |
| Operating result before interest, tax, depreciation and amortisation | |||
| (EBITDA) | 18.8 | 45.5 | (58.6%) |
| EBITDA margin (%) | 10.5% | 23.4% | |
| EBITDA adjusted | 38.1 | 45.2 | (15.8%) |
| EBITDA margin adjusted (%) | 21.9% | 23.3% | |
| Operating result (EBIT) | (9.2) | 23.8 | (>100%) |
| EBIT margin (%) | (5.1%) | 12.3% | |
| EBIT adjusted | 19.1 | 25.7 | (25.5%) |
| EBIT margin adjusted (%) | 11.0% | 13.2% | |
| Profit for the year | (13.6) | 19.6 | (>100%) |
| Earnings per share (€) | (0.35) | 0.50 | (>100%) |
| Additions to property, plant and equipment and intangible assets | 81.1 | 59.9 | 35.2% |
| Average number of staff (incl. leased personnel) | 9,165 | 8,390 | 9.2% |
EBITDA declined by € 26.7 million or -58.6% from € 45.5 million to € 18.8 million in the first three months. The reduction results primarily from the start-up effects of the Chongqing project, which burdened EBITDA with € 19.3 million in the first three months. Adjusted for these start-up effects, EBIT would amount to € 38.1 million, which would be € 7.1 million or -15.8% below the high level of the previous year. This decline is a result of the decrease in revenue and increased price pressure.
The EBITDA margin was 10.5% in the first three months and thus -12.9 percentage points below the very high level of 23.4% in the previous year. Adjusted for the Chongqing project, the margin would amount to 21.9%, down -1.4 percentage points on the adjusted prior-year level. AT&S nearly maintained its relative profitability in the core business at the very high prior-year level despite of the seasonal slowdown.
Depreciation and amortisation increased by € 6.3 million or 13.6% compared with the previous year, from € 21.7 million to € 28.0 million. This is due to the € 7.6 million increase in depreciation for the Chongqing project. In the core business, depreciation and amortisation rose by € 0.9 million. Changes in currency translation effects reduced depreciation and amortisation by € 2.2 million.
EBIT dropped by € 33.0 million from € 23.8 million to € -9.2 million. Adjusted for the Chongqing project, EBIT totalled € 19.1 million, and was thus € 6.6 million lower than in the adjusted previous year.
The EBIT margin amounted to -5.1% (previous year: 12.3%). The adjusted margin was 11.0%, thus -2.2 percentage points below the adjusted prior-year level of 13.2%.
Finance costs decreased significantly from € -0.2 million to € -5.7 million. Despite the 24.4% increase in gross debt due to optimisation measures carried out, gross interest expenses, at € 3.9 million, were only 8.9% higher than in the previous year, at € 3.6 million. Capitalised interest rose by € 0.6 million, from € 0.7 million to € 1.3 million. Currency translation effects had an impact of € 3.3 million on finance costs in the first three months, leading to additional expenses of € 5.8 million compared with the income of € 2.5 million in the previous year.
Based on earnings before tax, tax income of € 1.3 million was recorded (previous year: tax expenses of € 4.0 million), which resulted from the capitalisation of deferred taxes on current losses. At 8.4%, the Group's tax rate was significantly below the level of 16.9% in the previous year. However, as the amounts are low, these figures have little significance as small amounts can lead to substantial percentage deviations in a hightax or low-tax country.
The profit for the period fell by € 33.2 million from € 19.6 million to a loss for the period of € -13.6 million due to the start-up effects of the Chongqing project and the significantly higher negative finance costs. Consequently, earnings per share decreased from € 0.50 to € -0.35.
FINANCIAL POSITION Total assets increased by € 143.7 million or 10.7% in the first three months, from € 1,344.7 million to € 1,488.4 million. The increase due to additions to assets for the new plant in Chongqing of € 60.5 million and technology upgrades at the other sites of € 20.5 million (the additions to assets led to € 66.8 million of cash CAPEX) was offset by an increase of € 6.3 million in depreciation and amortisation to a total of € 28.0 million. The increase in inventories by € 83.4 million to € 96.3 million primarily results from the ramp-up of the IC substrate production. The increase in receivables is in turn related to seasonal factors as the lower revenue resulting from the Chinese New Year's celebrations generally leads to lower receivables at the end of the year. The increase in trade and other payables resulted from a higher purchasing volume for the Chongqing project. Financial assets rose by € 35.5 million to € 123.3 million. Together with higher cash and cash equivalents of € 185.1 million (31 March 2016: € 171.9 million), AT&S has a total of € 308.4 million of cash and cash equivalents available or available in the short term. The scheduled repayment of the bond in November, the financing of the start-up phase as well as the necessary investments in the second substrate line and outstanding payments for investments in the two lines for substrate-like printed circuit boards are thus secured.
Equity decreased by € 15.4 million or -2.7% from € 568.9 million to € 553.5 million. The decline resulted from the loss for the period of € 13.6 million and negative currency differences of € 1.8 million from the translation of the net asset position of the subsidiaries as well as from the translation of long-term loans to subsidiaries. Due to the substantial increase in total assets, the resulting equity ratio, at 37.2%, was -5.1 percentage points down and thus significantly lower than at 31 March 2016.
Net debt rose by € 79.2 million or 30.1% from € 263.2 million to € 342.4 million. This increase was expected and resulted from the high investment activities and the increase in working capital, which can not be financed from the operating result.
The net gearing ratio, at 61.9%, was at a higher level than at 31 March 2016, at 46.3%. This results from the increase in net debt and from the slight decrease in equity due to the above-mentioned effects.
In the first three months, further optimisation measures were taken in the treasury area. In addition to the payout of € 100.0 million from the bilateral promissory note loan, which had been signed at the end of March
2016, with a term of 7 years, another bilateral promissory note loan of € 50.0 million, with a term of 5 years, was signed and paid out in May 2016. In addition, an OeKB equity financing transaction of € 75.0 million was concluded with a consortium of Austrian banks at the end of June 2016. Of this total, € 25.0 million can be drawn until 31 December 2017 and € 50.0 million until 31 March 2018. After a grace period, the repayments will be made from 30 September 2018 to 30 June 2026. The funds received will be used for the optimisation of the existing loan structure on the one hand; on the other hand, they enable AT&S to take advantage of the low interest level of the last years. Further optimisation measures are currently under review.
BUSINESS DEVELOPMENT BY SEGMENTS The AT&S Group breaks its operating activities down into three segments: Mobile Devices & Substrates, Automotive, Industrial, Medical and Others. For further information on the segments and the segment reporting please refer to the Annual Report 2015/16.
AT&S has successfully positioned itself as a high-end manufacturer in all three segments. The share of the segment Mobile Devices & Substrates in total external revenue declined from 59.6% to 54.6%. The share of the Automotive, Industrial, Medical segment in revenue was at 45.0% (previous year: 40.0%). The significance of the Others segment remained constant at 0.4%.
MOBILE DEVICES & SUBSTRATES SEGMENT Demand for high-end printed circuit boards for mobile devices was seasonally good in the first three months, while the comparative quarter of the previous year showed no seasonality. Therefore, revenue fell by € 17.8 million or -12.9%, from € 138.2 million to € 120.4 million. This includes the first revenues from IC substrates.
| € in millions (unless otherwise stated) | Q1 2016/17 | Q1 2015/16 | Change in % |
|---|---|---|---|
| Segment revenue | 120.4 | 138.2 | (12.9%) |
| Revenue from external customers | 97.7 | 115.9 | (15.6%) |
| Operating result before interest, tax, depreciation and amortisation (EBITDA) |
8.7 | 33.3 | (73.8%) |
| EBITDA margin (%) | 7.3% | 24.1% | |
| Operating result (EBIT) | (15.4) | 14.4 | (>100%) |
| EBIT margin (%) | (12.8%) | 10.5% | |
| Additions to property, plant and equipment and intangible assets | 75.9 | 49.0 | 55.0% |
| Employees (incl. leased personnel), average | 6,409 | 5,689 | 12.7% |
EBITDA declined by € 24.6 million or -73.8% from € 33.3 million to € 8.7 million. The EBITDA margin was influenced by the aforementioned start-up effects of the Chongqing project. Adjusted for the share of the Mobile Devices & Substrates segment in the start-up effects, EBITDA amounts to € 26.4 million. This results in an adjusted EBITDA margin of 22.8%, which is slightly below the adjusted prior-year value of 24.2%.
Depreciation and amortisation in the segment rose by € 5.3 million or 28.2% from € 18.8 million to € 24.1 million. The increase was primarily attributable to depreciation of the new IC substrate plant in Chongqing. As a result, the segment's EBIT amounted to € -15.4 million, which is € 29.8 million lower than in the previous year. The segment's EBIT margin was down -23.3 percentage points from 10.5% to -12.8%.
The Chongqing project resulted in additions to assets of € 60.5 million (previous year: € 26.1 million) in the segment in the first three months. The other additions were related to technology upgrades at the Shanghai
Mobile Devices & Substrates EBITDA Development € in millions
site. The increase in the number of employees by 720 persons is primarily attributable to the establishment of the Chongqing plant.
Automotive, Industrial, Medical Development of revenue € in millions
Automotive, Industrial, Medical segment – overview
| € in millions (unless otherwise stated) | Q1 2016/17 | Q1 2015/16 | Change in % |
|
|---|---|---|---|---|
| Segment revenue | 86.7 | 84.8 | 2.3% | |
| Revenue from external customers | 80.4 | 77.8 | 3.3% | |
| Operating result before interest, tax, depreciation and amortisation (EBITDA) |
8.9 | 8.7 | 1.6% | |
| EBITDA margin (%) | 10.2% | 10.3% | ||
| Operating result (EBIT) | 5.4 | 6.2 | (13.8%) | |
| EBIT margin (%) | 6.2% | 7.3% | ||
| Additions to property, plant and equipment and intangible assets | 4.8 | 6.1 | (21.4%) | |
| Employees (incl. leased personnel), average | 2,601 | 2,552 | 1.9% | |
Automotive, Industrial, Medical EBITDA Development € in millions The segment's EBITDA increased slightly by € 0.2 million, or 1.6% from € 8.7 million to € 8.9 million. The EBITDA margin maintained the level of the previous year with a decline by -0.1 percentage points from 10.3% to 10.2%. Adjusted for the share of the Automotive, Industrial, Medical segment in the start-up effects of the Chongqing project, EBITDA amounts to € 10.5 million and an adjusted EBITDA margin of 12.4% (previous year adjusted: 10.0%).
The segment's depreciation and amortisation rose from € 2.5 million to € 3.5 million, thus leading to a decline in EBIT by € 0.8 million or 13.8% to € 5.4 million compared with € 6.2 million in the comparative period of the previous year.
The additions to assets, at € 4.8 million, were below the prior-year value of € 6.1 million.
OTHERS SEGMENT The business unit Advanced Packaging, which is part of the Others segment, was unable to continue the development of the previous year and recorded revenue of € 3.8 million (previous year: € 6.0 million) down € 2.2 million or -36.9% compared with the previous year. As this business unit is still in the process of being established, business is largely project-related, which currently leads to more volatile revenue developments.
In line with the development of revenue, the segment's EBITDA and EBIT also declined. The costs of the general holding activities, which are included in the Others segment, exceeded the prior-year values due to oneoff effects.
| Others segment – overview | ||||
|---|---|---|---|---|
| € in millions (unless otherwise stated) | Q1 2016/17 | Q1 2015/16 | Change in % |
|
| Segment revenue | 3.8 | 6.0 | (36.9%) | |
| Revenue from external customers | 0.7 | 0.7 | 0.6% | |
| Operating result before interest, tax, depreciation and amortisation (EBITDA) |
1.2 | 3.4 | (63.8%) | |
| EBITDA margin (%) | 32.4% | 56.5% | ||
| Operating result (EBIT) | 0.9 | 3.1 | (70.8%) | |
| EBIT margin (%) | 23.6% | 51.0% | ||
| Additions to property, plant and equipment and intangible assets | 0.3 | 4.8 | (93.6%) | |
| Employees (incl. leased personnel), average | 155 | 149 | 4.1% | |
SIGNIFICANT EVENTS AFTER THE END OF THE INTERIM REPORTING PERIOD No significant events occurred after the end of the interim reporting period.
SIGNIFICANT RISKS, UNCERTAINTIES AND OPPORTUNITIES There were no significant changes in the risk categories compared with those described in detail in section 6 "Risk and opportunities management" of the Group Management Report of the consolidated financial statements 2015/16.
With respect to opportunities and risks related to developments in the external environment for the full financial year 2016/17, it is still assumed that revenues in the printed circuit board industry will increase worldwide.
OUTLOOK Against the backdrop of slower growth in parts of the existing customer segments and because of growing competition, AT&S expects stronger seasonality again in the first and fourth quarters of the financial year 2016/17 and continued low visibility. Provided that the macroeconomic environment remains stable, the USD-EUR currency relation stays at a similar level as in the past financial year 2015/16 and demand is stable in the core business, the management expects an increase in revenue of 10-12% for the financial year 2016/17. Based on the expected start-up costs for the further ramp-up in Chongqing, the EBITDA margin should range between 18-20%, the EBITDA margin in the core business, however, at a similar level as in the financial year 2015/16. Higher depreciation and amortisation of an additional € 40 million p.a. for the Chongqing project will have a significant influence on EBIT.
Leoben-Hinterberg, 27 July 2016
Management Board
Andreas Gerstenmayer m.p. Karl Asamer m.p. Heinz Moitzi m.p.
| € in thousands | 01 Apr – 30 Jun 2016 01 Apr – 30 Jun 2015 | ||||
|---|---|---|---|---|---|
| Revenue | 178,867 | 194,392 | |||
| Cost of sales | (169,441) | (152,605) | |||
| Gross profit | 9,426 | 41,787 | |||
| Distribution costs | (7,574) | (8,614) | |||
| General and administrative costs | (7,462) | (6,557) | |||
| Other operating result | (3,559) | (2,803) | |||
| Operating result | (9,169) | 23,813 | |||
| Finance income | 845 | 3,297 | |||
| Finance costs | (6,563) | (3,467) | |||
| Finance costs – net | (5,718) | (170) | |||
| Profit before tax | (14,887) | 23,643 | |||
| Income taxes | 1,253 | (3,993) | |||
| Profit for the period | (13,634) | 19,650 | |||
| Attributable to owners of the parent company | (13,634) | 19,617 | |||
| Attributable to non-controlling interests | – | 33 | |||
| Earnings per share attributable to equity holders of the parent company (in € per share): |
|||||
| – basic | (0.35) | 0.50 | |||
| – diluted | (0.35) | 0.50 | |||
| Weighted average number of shares outstanding – basic (in thousands) |
38,850 | 38,850 | |||
| Weighted average number of shares outstanding – diluted (in thousands) |
38,850 | 38,850 |
| € in thousands | 01 Apr – 30 Jun 2016 01 Apr – 30 Jun 2015 | ||||
|---|---|---|---|---|---|
| Profit for the period | (13,634) | 19,650 | |||
| Items to be reclassified: | |||||
| Currency translation differences | (1,769) | (23,554) | |||
| Gains from the fair value measurement of hedging instruments for | |||||
| cash flow hedges, net of tax | – | 619 | |||
| Other comprehensive income for the period | (1,769) | (22,935) | |||
| Total comprehensive income for the period | (15,403) | (3,285) | |||
| Attributable to owners of the parent company | (15,403) | (3,307) | |||
| Attributable to non-controlling interests | – | 22 | |||
| € in thousands 30 Jun 2016 |
31 Mar 2016 | ||
|---|---|---|---|
| ASSETS | |||
| Property, plant and equipment | 740,686 | 689,161 | |
| Intangible assets | 101,145 | 103,736 | |
| Financial assets | 96 | 96 | |
| Deferred tax assets | 38,957 | 33,826 | |
| Other non-current assets | 49,888 | 39,519 | |
| Non-current assets | 930,772 | 866,338 | |
| Inventories | 96,296 | 83,438 | |
| Trade and other receivables | 152,646 | 134,687 | |
| Financial assets | 123,250 | 87,817 | |
| Current income tax receivables | 292 | 504 | |
| Cash and cash equivalents | 185,097 | 171,866 | |
| Current assets | 557,581 | 478,312 | |
| Total assets | 1,488,353 | 1,344,650 | |
| EQUITY | |||
| Share capital | 141,846 | 141,846 | |
| Other reserves | 71,919 | 73,688 | |
| Retained earnings | 339,768 | 353,402 | |
| Equity attributable to owners of the parent company | 553,533 | 568,936 | |
| Total equity | 553,533 | 568,936 | |
| LIABILITIES | |||
| Financial liabilities | 521,177 | 361,558 | |
| Provisions for employee benefits | 37,164 | 36,293 | |
| Other provisions | 6,805 | 6,957 | |
| Deferred tax liabilities | 9,198 | 8,844 | |
| Other liabilities | 7,390 | 7,755 | |
| Non-current liabilities | 581,734 | 421,407 | |
| Trade and other payables | 212,604 | 180,257 | |
| Financial liabilities | 129,638 | 161,413 | |
| Current income tax payables | 5,894 | 7,557 | |
| Other provisions | 4,950 | 5,080 | |
| Current liabilities | 353,086 | 354,307 | |
| Total liabilities | 934,820 | 775,714 | |
| Total equity and liabilities | 1,488,353 | 1,344,650 |
| € in thousands | 01 Apr – 30 Jun 2016 01 Apr – 30 Jun 2015 | |||
|---|---|---|---|---|
| Operating result | (9,169) | 23,813 | ||
| Depreciation, amortisation and impairment of property, plant and equipment and intangible assets | 28,000 | 21,705 | ||
| Gains/losses from the sale of fixed assets | (26) | 6 | ||
| Non-cash expense/(income), net | (3,681) | 2,492 | ||
| Interest paid | (1,947) | (1,150) | ||
| Interest received | 533 | 788 | ||
| Income taxes paid | (5,145) | (2,926) | ||
| Cash flow from operating activities before changes in working capital | 8,565 | 44,728 | ||
| Inventories | (12,817) | 1,576 | ||
| Trade and other receivables | (27,509) | (13,967) | ||
| Trade and other payables | 20,076 | 5,632 | ||
| Other provisions | (113) | (282) | ||
| Cash flow from operating activities | (11,798) | 37,687 | ||
| Capital expenditure for property, plant and equipment and intangible assets | (66,847) | (40,372) | ||
| Proceeds from the sale of property, plant and equipment and intangible assets | 533 | 41 | ||
| Capital expenditure for financial assets | (60,796) | – | ||
| Proceeds from the sale of financial assets | 25,583 | – | ||
| Cash flow from investing activities | (101,527) | (40,331) | ||
| Proceeds from borrowings | 163,162 | 3,671 | ||
| Repayments of borrowings | (37,638) | (582) | ||
| Proceeds from government grants | 147 | 231 | ||
| Cash flow from financing activities | 125,671 | 3,320 | ||
| Change in cash and cash equivalents | 12,346 | 676 | ||
| Cash and cash equivalents at beginning of the year | 171,866 | 273,919 | ||
| Exchange gains/(losses) on cash and cash equivalents | 885 | (3,833) | ||
| Cash and cash equivalents at end of the period | 185,097 | 270,762 |
| € in thousands | Share capital |
Other reserves |
Retained earnings |
Equity attributable to owners of the parent company |
Non controlling interests |
Total equity |
|---|---|---|---|---|---|---|
| 31 Mar 2015 | 141,846 | 150,774 | 311,642 | 604,262 | 96 | 604,358 |
| Profit for the period | – | – | 19,617 | 19,617 | 33 | 19,650 |
| Other comprehensive income for the period | – | (22,924) | – | (22,924) | (11) | (22,935) |
| thereof currency translation differences | – | (23,543) | – | (23,543) | (11) | (23,554) |
| thereof change in hedging instruments for cash flow hedges, net of tax |
– | 619 | – | 619 | – | 619 |
| Total comprehensive income for the period | – | (22,924) | 19,617 | (3,307) | 22 | (3,285) |
| 30 Jun 2015 | 141,846 | 127,850 | 331,259 | 600,955 | 118 | 601,073 |
| 31 Mar 2016 | 141,846 | 73,688 | 353,402 | 568,936 | – | 568,936 |
| Profit for the period | – | – | (13,634) | (13,634) | – | (13,634) |
| Other comprehensive income for the period | – | (1,769) | – | (1,769) | – | (1,769) |
| thereof currency translation differences | – | (1,769) | – | (1,769) | – | (1,769) |
| Total comprehensive income for the period | – | (1,769) | (13,634) | (15,403) | – | (15,403) |
| 30 Jun 2016 | 141,846 | 71,919 | 339,768 | 553,533 | – | 553,533 |
| € in thousands | Mobile Devices & Substrates |
Automotive, Industrial, Medical |
Others | Elimination/ Consolidation |
Group | |||||
|---|---|---|---|---|---|---|---|---|---|---|
| 01 Apr - 30 Jun 2016 |
01 Apr - 30 Jun 2015 |
01 Apr - 30 Jun 2016 |
01 Apr - 30 Jun 2015 |
01 Apr - 30 Jun 2016 |
01 Apr - 30 Jun 2015 |
01 Apr - 30 Jun 2016 |
01 Apr - 30 Jun 2015 |
01 Apr - 30 Jun 2016 |
01 Apr - 30 Jun 2015 |
|
| Segment revenue | 120,425 | 138,185 | 86,722 | 84,812 | 3,782 | 5,991 | (32,062) | (34,596) | 178,867 | 194,392 |
| Internal revenue | (22,688) | (22,321) | (6,298) | (6,986) | (3,076) | (5,289) | 32,062 | 34,596 | – | – |
| External revenue | 97,737 | 115,864 | 80,424 | 77,826 | 706 | 702 | – | – | 178,867 | 194,392 |
| Operating result before depreciation/amortisation |
8,733 | 33,292 | 8,875 | 8,737 | 1,224 | 3,384 | (1) | 105 | 18,831 | 45,518 |
| Depreciation/amortisation | (24,146) | (18,849) | (3,522) | (2,529) | (332) | (327) | – | – | (28,000) | (21,705) |
| Operating result | (15,413) | 14,443 | 5,353 | 6,208 | 892 | 3,057 | (1) | 105 | (9,169) | 23,813 |
| Finance costs - net | (5,718) | (170) | ||||||||
| Profit before tax | (14,887) | 23,643 | ||||||||
| Income taxes | 1,253 | (3,993) | ||||||||
| Profit for the year | (13,634) | 19,650 | ||||||||
| Property, plant and equipment and intangible assets1) |
744,153 | 696,578 | 94,083 | 92,695 | 3,595 | 3,624 | – | – | 841,831 | 792,897 |
| Additions to property, plant and equipment and intangible assets |
75,935 | 48,988 | 4,815 | 6,127 | 308 | 4,820 | – | – | 81,058 | 59,935 |
1) Previous year values as of 31 March 2016
Revenues broken down by customer region, based on customer's headquarters:
| € in thousands | 01 Apr – 30 Jun 2016 01 Apr – 30 Jun 2015 | |
|---|---|---|
| Austria | 5,606 | 4,974 |
| Germany | 41,940 | 38,850 |
| Other European countries | 12,525 | 12,460 |
| China | 8,633 | 6,024 |
| Other Asian countries | 16,429 | 20,842 |
| Americas | 93,734 | 111,242 |
| Revenue | 178,867 | 194,392 |
Property, plant and equipment and intangible assets broken down by domicile:
| Property, plant and equipment and intangible assets | 841,831 | 792,897 |
|---|---|---|
| Others | 30,325 | 30,309 |
| China | 744,108 | 696,534 |
| Austria | 67,398 | 66,054 |
| € in thousands | 30 Jun 2016 | 31 Mar 2016 |
ACCOUNTING AND MEASUREMENT POLICIES The interim report for the three months ended 30 June 2016 has been prepared in accordance with the standards (IFRS and IAS) and interpretations (IFRIC and SIC) of the International Accounting Standards Board (IASB), taking IAS 34 into account, as adopted by the European Union.
The interim consolidated financial statements do not include all the information contained in the annual consolidated financial statements and should be read in conjunction with the consolidated annual financial statements for the year ended 31 March 2016.
The interim consolidated statements ended 30 June 2016 are unaudited and have not been the subject of external audit review.
REVENUE Group revenue in the three months of the current financial year decreased by -8.0% from € 194.4 million in the same period last year to € 178.9 million.
GROSS PROFIT The current gross profit of € 9.4 million was lower than the € 41.8 million achieved in the same period last year. This is a decrease of 77.4%. This unsatisfactory outcome results from start-up costs for the Chongqing project and a decline in revenue.
OPERATING RESULT On the basis of the decreased gross profit and higher start-up costs for the new plants in Chongqing, the consolidated operating result of AT&S has declined to € -9.2 million or -5.1% of revenue.
FINANCE COSTS - NET The finance costs of € 6.6 million were above the prior-year level due to foreign exchange losses. The financial income from the investment of free cash basically was € 0.8 million. As a consequence net finance costs decreased by € 5.5 million in comparison to the same period of the previous year and amounted to € -5.7 million. The net finance costs include gains from capitalised interest of € 1.3 million (previous year: € 0.7 million). Net interest expense on personnel-related liabilities of € 0.2 million is recognised in "finance costs – net" (previous year: € 0.2 million).
INCOME TAXES The change of the effective tax rate on the consolidated level compared with the same period of previous year mainly results from the variation of proportions of Group earnings contributed by individual companies with different tax rates.
CURRENCY TRANSLATION DIFFERENCES The decrease in the foreign currency translation reserves in the current financial year (€ -1.8 million) was the result of the changes in exchange rates of the Group's functional currencies, the Chinese yuan renminbi and the Hong Kong dollar against the Group's reporting currency, the euro.
| Closing rate | Average rate | |||||
|---|---|---|---|---|---|---|
| 01 Apr - | 01 Apr - | |||||
| 30 Jun 2016 | 31 Mar 2016 | Change in % | 30 Jun 2016 | 30 Jun 2015 | Change in % | |
| Chinese yuan renminbi | 7.3893 | 7.3514 | 0.5% | 7.3594 | 6.7608 | 8.9% |
| Hong Kong dollar | 8.6464 | 8.8231 | (2.0%) | 8.7429 | 8.5424 | 2.3% |
| Indian rupee | 75.2028 | 75.3466 | (0.2%) | 75.2868 | 69.8715 | 7.8% |
| Japanese yen | 114.5700 | 127.8200 | (10.4%) | 122.0600 | 133.6295 | (8.7%) |
| South Korean won | 1,280.2400 | 1,297.7560 | (1.3%) | 1,299.5535 | 1,215.0576 | 7.0% |
| US dollar | 1.1143 | 1.1378 | (2.1%) | 1.1267 | 1.1019 | 2.3% |
| Taiwan dollar | 35.8454 | 36.5967 | (2.1%) | 36.3969 | 34.0364 | 6.9% |
ASSETS AND FINANCES Net debt, at € 342.4 million, increased versus the € 263.2 million outstanding at 31 March 2016. The increase was primarily caused by investments in the new plants in Chongqing. Net working capital of € 88.4 million as at 31 March 2016 rose to € 99.6 million mainly due to increased receivables and inventories. The net gearing ratio, at 61.9%, was above the 46.3% at 31 March 2016.
Three valuation hierarchies have to be distinguished in the valuation of financial instruments measured at fair value.
The financial instruments valued at fair value at the end of the reporting period at the three valuation levels were as follows:
| € in thousands | ||||
|---|---|---|---|---|
| 30 Jun 2016 | Level 1 | Level 2 | Level 3 | Total |
| Financial assets | ||||
| Financial assets at fair value through profit or loss: | ||||
| – Bonds | 631 | – | – | 631 |
| Available-for-sale financial assets | – | 96 | – | 96 |
| Financial liabilities | ||||
| Derivative financial instruments | – | 4,009 | – | 4,009 |
| € in thousands | ||||
|---|---|---|---|---|
| 31 Mar 2016 | Level 1 | Level 2 | Level 3 | Total |
| Financial assets | ||||
| Financial assets at fair value through profit or loss: | ||||
| – Bonds | 631 | – | – | 631 |
| Available-for-sale financial assets | – | 96 | – | 96 |
| Financial liabilities | ||||
| Derivative financial instruments | – | 3,871 | – | 3,871 |
Bonds, export loans, government loans and other bank borrowings amounting to € 646.8 million (31 March 2016: € 519.1 million) are measured at amortised cost. The fair value of these liabilities was € 654.0 million (31 March 2016: € 526.0 million).
OTHER FINANCIAL COMMITMENTS At 30 June 2016 the Group had other financial commitments amounting to € 50.1 million, in connection with contractually binding investment commitments, the greater part of which related to the continuing construction of the new site in Chongqing and investments in the Shanghai and Leoben plants. As at 31 March 2016 other financial commitments stood at € 80.1 million.
EQUITY Consolidated equity decreased from € 568.9 million at 31 March 2016 to € 553.5 million. The consolidated loss for the period of € -13.6 million, together with negative impacts from currency translation differences of € -1.8 million, contributed to the consolidated total comprehensive income of € -15.4 million.
At the 20th Annual General Meeting on 3 July 2014 the Management Board was authorised until 2 July 2019 to increase the share capital of the Company, subject to the approval of the Supervisory Board, by up to € 21,367,500 by way of issuing up to 19,425,000 no-par value bearer shares, for contributions in cash or kind, in one or more tranches, including issue by means of an indirect share offering via banks in accordance with section 153 para 6 Austrian Stock Corporation Act (AktG). The Management Board was authorised, subject to the approval of the Supervisory Board, to determine the detailed terms and conditions of issue (in particular, issue price, nature of contributions in kind, rights related to shares, exclusion of subscription rights, etc.) (authorised capital). The Supervisory Board was authorised to approve changes in the Articles of Association required by the issue of shares out of authorised capital. The Annual General Meeting approved a resolution amending Section 4 (Nominal Capital) of the Articles of Association to reflect this change.
In addition, at the 20th Annual General Meeting of 3 July 2014 the resolution of the Annual General Meeting of 7 July 2010 authorising the issue of convertible bonds was rescinded and at the same time the Management Board was authorised until 2 July 2019, subjet to the approval of the Supervisory Board, to issue convertible bearer bonds up to a maximum nominal value of € 150,000,000 in one or more tranches, and to grant the holders of the convertible bond subscription and/or conversion rights for up to 19,425,000 new nopar value bearer shares in the Company in accordance with the terms and conditions of the convertible bond to be determined by the Management Board. For this purpose, in accordance with section 159 para 2 item 1 AktG, the share capital of the Company was also conditionally increased by up to € 21,367,500 in the form of up to 19,425,000 new no-par value bearer shares. This capital increase will only take place to the extent that holders of convertible bonds exercise their conversion or subscription rights in accordance with the resolution of the Annual General Meeting of 3 July 2014. The Management Board was also authorised, subject to the approval of the Supervisory Board, to determine further details of the conditional capital increase (in particular, the amount of the issue and the rights related to shares).
With respect to the authorised share capital increase and/or the conditional capital increase, the following restrictions on the amounts of the increases are to be observed, as required under the resolutions passed at
the 20th Annual General Meeting of 3 July 2014: The total of (i) the number of new shares actually issued or potentially issuable out of conditional capital under the terms and conditions of the convertible bonds, and (ii) the number of shares issued out of authorised capital may not exceed 19,425,000 (definition of amount of authorisations).
TREASURY SHARES At the 21st Annual General Meeting of 9 July 2015 the Management Board was again authorised for a period of 30 months from the date of the resolution to acquire and retire the Company's own shares up to a maximum amount of 10% of the share capital at a lowest price that may be no more than 30% lower than the average unweighted closing price of the previous 10 trading days and at a highest price per share of a maximum of up to 30% above the average unweighted closing price of the previous 10 trading days. The Management Board was also authorised to withdraw repurchased treasury shares as well as treasury shares already held by the Company without any further resolution of the Annual General Meeting. The Management Board was also again authorised – for a period of five years (i.e., until 8 July 2020), upon approval of the Supervisory Board – to sell or use the repurchased treasury shares or treasury shares already held by the Company otherwise than through the stock exchange or by means of public offerings, and in particular for the purpose of enabling the exercise of employee stock options or the conversion of convertible bonds, or as consideration for the acquisition of businesses or other assets, or for any other legally permissible purpose.
On 30 June 2016, the Group held no treasury shares.
NOTES TO THE STATEMENT OF CASH FLOWS Cash flow from operating activities amounted to € -11.8 million compared with € 37.7 million in the same period last year. The decrease is mainly due to the losses in the profit of the period caused by the start-up costs for the Chongqing project and the increased net working capital.
The cash flow from investing activities of € -101.5 million is above the level of € -40.3 million reached in the same period last year. Thereof capital expenditure for property, plant and equipment and intangible assets accounts for € -66.8 million. This year's capital expenditures are predominantly in the new plants in Chongqing and technology upgrades in the other plants. Capital expenditure for financial assets amounts to € - 60.8 million for investment and reinvestments of liquid funds.
Cash flow from financing activities amounted to € 125.7 million and is mainly attributable to the obtaining of two promissory note loans at an amount of € 150.0 million in April and May 2016.
The non-cash expense/income is as follows:
| € in thousands | 01 Apr - 30 Jun 2016 | 01 Apr - 30 Jun 2015 |
|---|---|---|
| Changes in non-current provisions | 703 | 523 |
| Release of government grants | (283) | (293) |
| Other non-cash expense/(income), net | (4,101) | 2,262 |
| Non-cash expense/(income), net | (3,681) | 2,492 |
DIVIDENDS The Annual General Meeting of 7 July 2016 resolved on a dividend payment of € 0.36 per share out of retained earnings as at 31 March 2016. The dividend distribution of € 14.0 million will take place on 28 July 2016.
RELATED PARTY TRANSACTIONS In connection with various projects, the Group received consulting services from companies where Supervisory Board chairman Mr. Androsch (AIC Androsch International Management Consulting GmbH) and Supervisory Board deputy chairman Mr. Dörflinger (Dörflinger Management & Beteiligungs GmbH) are managing directors with the power of sole representation. The fees charged are as follows:
| € in thousands | 01 Apr - 30 Jun 2016 | 01 Apr - 30 Jun 2015 |
|---|---|---|
| AIC Androsch International Management Consulting GmbH | 91 | 107 |
| Dörflinger Management & Beteiligungs GmbH | 3 | 2 |
| Total fees | 94 | 109 |
At the balance sheet date, there are no outstanding balances or obligations to the above mentioned legal and consulting companies.
Leoben-Hinterberg, 27 July 2016
Management Board
Andreas Gerstenmayer m.p. Karl Asamer m.p. Heinz Moitzi m.p.
We confirm to the best of our knowledge that the interim financial statements give a true and fair view of the assets, liabilities, financial position and profit or loss of the group as required by the applicable accounting standards and that the group interim management report gives a true and fair view of important events that have occurred during the first three months of the financial year and their impact on the interim financial statements, of the principal risks and uncertainties for the remaining nine months of the financial year and of the major related party transactions to be disclosed.
Leoben-Hinterberg, 27 July 2016
The Management Board
Andreas Gerstenmayer m.p. Chief Executive Officer
Karl Asamer m.p. Chief Financial Officer
Heinz Moitzi m.p. Chief Operations Officer
AT & S Austria Technologie & Systemtechnik Aktiengesellschaft Fabriksgasse 13 8700 Leoben Austria Phone: +43 (0)3842 200-0 www.ats.net
Elke Koch Phone: +43 (0)3842 200-5925 [email protected]
AT & S Austria Technologie & Systemtechnik Aktiengesellschaft Fabriksgasse 13 8700 Leoben Austria www.ats.net
Andreas Jakwerth: page 24 Klaus Vyhnalek: page 3 Werbeagentur DMP: page 5
This report contains forward-looking statements which were made on the basis of the information available at the time of publication. These can be identified by the use of such expressions as "expects", "plans", "anticipates", "intends", "could", "will", "aim" and "estimation" or other similar words. These statements are based on current expectations and assumptions. Such statements are by their very nature subject to known and unknown risks and uncertainties. As a result, actual developments may vary significantly from the forward-looking statements made in this report. Recipients of this report are expressly cautioned not to place undue reliance on such statements. Neither AT&S nor any other entity accept any responsibility for the correctness and completeness of the forward-looking statements contained in this report. AT&S undertakes no obligation to update or revise any forward-looking statements, whether as a result of changed assumptions or expectations, new information or future events.
Percentages and individual items presented in this report are rounded which may result in rounding differences.
Formulations attributable to people are to be understood as gender-neutral.
This report in no way represents an invitation or recommendation to buy or sell shares in AT&S.
The report is published in German and English. In case of doubt, the German version is binding.
No responsibility accepted for errors or omissions.
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