Kitron — Earnings Release 2021

Jul 12, 2021

Kitron: Q2 2021 - Solid quarter and record order backlog

Kitron: Q2 2021 - Solid quarter and record order backlog

(2021-07-12) Kitron today reported solid revenue and profitability for the

second quarter as well as record order backlog. Strong growth within other

market sectors compensated for lower demand within Medical devices.

Kitron's revenue for the second quarter was NOK 994 million, compared to NOK

1 041 million last year. Underlying revenue growth in the second quarter was 5

per cent, as revenue for the first half and second quarter is negatively

affected by currency effects compared to last year of around 10 per cent, due to

the Norwegian krone having strengthened against Kitron's invoicing currencies.

Profitability expressed as EBIT margin was 7.4 per cent in the second quarter,

compared to 8.5 per cent in the same quarter last year. The EBIT margin is at

the top end of the company's guidance for 2021, and in line with the strategic

target path, although lower than last year, when there where economies of scale

due to exceptional volumes within Medical devices.

The order backlog ended at NOK 2 294, an increase of 9 per cent compared to last

year.

Peter Nilsson, Kitron's CEO, comments:

Despite currency headwind, Kitron had another solid quarter. Other market

sectors have picked up the slack as the Corona-related demand surge within

Medical devices ebbed. The underlying growth and profitability is on track for

our annual guidance and strategic ambitions, the record-high order backlog and

very strong demand in several market sectors make us confident in the last half

of the year.

Electrification and Industry show strong growth

There was strong growth within the Electrification, Connectivity and Industry

sectors, while revenue declined within Defence/Aerospace. As expected, revenue

within Medical devices has gradually been normalized after the pandemic-related

demand surge during 2020.

Record order backlog

The order backlog ended at NOK 2 294 million, compared to 2 102 million last

year. This is a record and reflects the strong total demand situation within IOT

and warehouse automation. Adjusted for currency effects the order backlog

increased by 13 per cent.

The order backlog increased within the Electrification, Connectivity and

Industry sectors, while it declined within Defence/Aerospace. As expected, the

order backlog within Medical devices has gradually been normalized.

EBIT margin 7.4%

Second quarter operating profit (EBIT) was NOK 73.1 million, compared to 88.0

million last year. EBITDA was NOK 97.5 million, compared to 113.8 million last

year.

Profit after tax amounted to NOK 49.5 million, compared to 64.3 million in the

same quarter the previous year. This corresponds to earnings per share of NOK

0.28, down from 0.36 last year.

Strong operating cash flow

Operating cash flow was NOK 109.3 million, compared to 5.5 million in the second

quarter last year.

Net working capital was NOK 1 034 million, a decrease of 2 per cent compared to

the same quarter last year. Net working capital as a percentage of revenue was

25.8 per cent, compared to 24.5 per cent last year. Longer term, capital ratios

are expected to improve going forward.

Material supply situation challenging

The general material supply situation continues to be a challenge to deliveries.

Kitron expects some relief during the fourth quarter and further relief during

the first half of 2022.

Outlook

For 2021, Kitron expects revenue between NOK 3 900 and 4 200 million. EBIT

margin is expected to be between 6.8 and 7.4 per cent. The outlook for 2021

implies that Kitron is back on its long term trajectory for revenue and

profitability after exceptional growth in 2020, largely driven by Corona-related

demand within the Medical devices sector. Growth is driven by Connectivity,

Electrification, and Industry sectors. The Medical devices sector is expected to

be normalised and in line with previous years. The outlook for Defence/Aerospace

is slightly down.

Enclosed in PDF are the quarterly report and the presentation. The interim

report is presented today at 2 p.m. CEST. The presentation will be given in

English by CEO Peter Nilsson and CFO Cathrin Nylander, and will be webcast at

the following link:

https://channel.royalcast.com/hegnarmedia/#!/hegnarmedia/20210712_2

For further information, please contact:

Peter Nilsson, President and CEO, tel. +47 94 84 08 50

Cathrin Nylander, CFO, tel: +47 900 43 284

E-mail: investorrelations@kitron.com

Kitron is a leading Scandinavian electronics manufacturing services company for

the Connectivity, Electrification, Industry, Medical devices and

Defence/Aerospace sectors. The company is located in Norway, Sweden, Lithuania,

Germany, Poland, China and the United States. Kitron had revenues of about NOK

4.0 billion in 2020 and has about 1 800 employees. www.kitron.com (http://pr-

eu.globenewswire.com)

This information is subject to the disclosure requirements pursuant to Section

5-12 the Norwegian Securities Trading Act