Melexis N.V.

Earnings Release • Apr 20, 2017

Press release

Melexis Q1 2017 results – First quarter sales growth of 13%

Intermediate declaration by the Board of Directors

Ieper, Belgium – April 20th, 2017, 07.00 hrs CET

Sales for the first quarter of 2017 were 123.6 million EUR, an increase of 13% compared to the same quarter of the previous year and an increase of 3% compared to the previous quarter.

The EUR/USD exchange rate evolution had a positive impact of 2%, both compared to the same quarter of last year and the previous quarter.

Gross margin was 56.6 million EUR, an increase of 15% compared to the same quarter of last year and an increase of 3% compared to the previous quarter.

R&D expenses were 13.7% of sales, G&A was at 4.5% of sales and Selling was at 2.1% of sales. The operating result was 31.5 million EUR, an increase of 14% compared to the same quarter of last year and an increase of 7% compared to the previous quarter.

Net income was 25.4 million EUR or 0.63 EUR per share, an increase of 11% compared to 22.8 million EUR or 0.57 EUR per share in the first quarter of 2016 and an increase of 1% compared to the previous quarter.

Outlook

Melexis expects sales in the second quarter of 2017 to be around the level of 127 million EUR. For the full year 2017, Melexis expects sales growth to be between 11% and 15%, a gross profit margin around 45% and an operating margin around 25%, all taking into account a EUR/USD exchange rate of 1.07.

Business comment – Françoise Chombar, CEO:

"Melexis started the year on the right track with a year over year sales growth of 13%. A growing order book provides confidence in our guidance for the full year. Our sensor interfaces and magnetic sensors were the main growth drivers for the quarter. I am especially pleased with the performance of current sensors both in our main automotive and also our industrial markets. This strong growth confirms we are ready for the accelerating automotive trend towards more electrification and are well-positioned to meet existing and future customer needs. In addition this demonstrates our increased diversification towards other markets.

Other outperforming product lines percentage-wise were fan drivers, pressure sensors, rain-light sensors and 3D time-of-flight sensors.

Sales to automotive customers represented 89% of total sales. The portion of standard product (ASSPs) sales represented 60% of total sales.''

Financial Calendar

• Dividend pay date: April 27, 2017 (ex coupon on April 25, 2017)
• Analyst Day: May 3, 2017
• Publication Q2/HY1 2017 Results: August 2, 2017
• Publication Q3 2017 Results: October 25, 2017
• Publication FY 2017 Results: February 7, 2018

The company's results will be discussed in a conference call on Thursday, April 20th , 2017 at 17 hrs CET. The conference call will be in English. You have to register for this conference call in advance. You can register by clicking on the following link and filling out the requested information: https://eventreg3.conferencing.com/inv/reg.html?Acc=034060&Conf=370408 Conference ID: 961686.

After registration, you will receive the conference call number, a participant user pin, conference pin and instructions on how to join the conference call. For security purposes all participants must register individually if they wish to join the call.

A replay number for this call is available for 7 days after the end of the conference call. The replay number for this call is +32 2 290 17 05, access code: 961686.

For further information: Investor Relations Phone: +32 13 67 07 79 Fax: +32 13 67 21 34 Email: investor@melexis.com

About Melexis

Combining a passion for technology with truly inspired engineering, Melexis designs, develops and delivers innovative micro-electronic solutions that enable designers to turn ideas into applications that support the best imaginable future. The company's advanced mixed-signal semiconductor sensor and actuator components address the challenges of integrating sensing, driving and communication into next-generation products and systems that improve safety, raise efficiency, support sustainability and enhance comfort. Melexis is headquartered in Belgium and employs over 1,100 people in 19 locations worldwide. The company is publicly traded on Euronext Brussels (MELE). For more information, visit www.melexis.com

Disclaimer

Except for those statements that report the Company's historical results, the statements being made are forward looking statements. Actual results could differ materially from those projected in the forward-looking statements. Factors which could cause actual results to differ from expectations include the following: volatility in supply and demand affecting revenues and market prices, price and availability of silicon foundry, assembly and test prices, assembly and test subcontract capacity required to meet financial targets and/or meet backlog requirements, risks and delays associated with bringing up new production capabilities or with deliveries from subcontractors, timing and market acceptance of new products, increased expenses associated with new product acceptance of new products, increased expenses associated with new product introductions of process changes, delays in developing or achieving volume production of new products, which can result in delays or failure to contribute to revenues and profits, ability of the Company to maintain its customer and vendor base and delays in and/or inability in raising additional capital.

Consolidated Income Statement

CONFORM IFRS		Quarter ended 31/03/2017	Quarter ended 31/03/2016	Quarter ended 31/12/2016	Year ended 31/12/2016
in k EUR				audited	audited
Sales		123,561	109,425	120,021	456,285
	Cost of sales	-66,954	-60,142	-64,819	-247,737
Gross Margin		56,606	49,283	55,202	208,548
	R&D	-16,948	-14,746	-17,077	-63,989
	G&A	-5,572	-4,717	-5,881	-20,944
	Selling	-2,561	-2,286	-2,849	-9,557
	Other operating result				311
Operating result		31,525	27,534	29,396	114,369
	Financial result	-1,276	-1,094	522	-1,293
Income before taxes		30,249	26,440	29,918	113,076
	Income taxes	-4,806	-3,605	-4,825	-16,819
Net income		25,442	22,836	25,093	96,257
Net income per share in EUR		0.63	0.57	0.62	2.38

Consolidated Statement of Financial Position

CONFORM IFRS	Quarter ended 31/03/2017	Quarter ended 31/03/2016	Year ended 31/12/2016
in k EUR			audited
Current Assets :
Cash and cash equivalents	92,045	89,981	75,789
Current investments		49	158
A/R Trade	60,517	52,834	66,298
A/R from related parties	9,194	10,320	418
Advance related parties
Assets for current tax	576	734	339
Assets held for sale		289
Other current assets	12,298	7,004	10,680
Inventories	79,702	62,258	76,880
Total current assets	254,332	223,470	230,562
Non-current assets :
Costs of incorporation
Property, plant and equipment	97,591	92,751	97,411
Financial assets	6	6	6
Intangible fixed assets	6,042	7,245	6,209
A/R directors
Other non-current assets	8	7	7
Deferred tax assets	24,727	9,784	23,970
Total non current assets	128,374	109,793	127,603
Total assets	382,706	333,263	358,165

CONFORM IFRS	Quarter ended	Quarter ended	Year ended
	31/03/2017	31/03/2016	31/12/2016
in k EUR			audited
Liabilities and shareholders Equity
Current liabilities :
Bank loans and overdrafts
Derivative financial instruments	1,261	1,385	793
Current portion of LT debt	4,005	4,046	4,047
A/P trade	18,578	18,458	19,555
Affiliated companies	16,969	11,285	14,551
Accrued taxes	25,965	6,080	30,160
Accrued expenses and payroll	10,104	9,581	8,603
Other current liabilities	2,808	1,662	2,567
Deferred income	2,247	1,871	2,262
Total current liabilities	81,937	54,369	82,538
Non current liabilities :
LT debt less current portion	11,093	11,091	11,093
Deferred tax liabilities
Other non-current liabilities	2,101	2,153	2,070
Total non current liabilities	13,195	13,245	13,163
Shareholders' equity :
Shareholders' capital	565	565	565
Share premium
Treasury shares	-3,818	-3,818	-3,818
Revaluation reserve Hedge	-182	-359	-226
Revaluation reserve Fair value
Legal reserve	57	57	57
Retained earnings	272,534	252,380	176,277
Current period's profit	25,442	22,836	96,257
Cumulative translation adjustment	-7,034	-6,021	-6,658
Equity attributable to company owners	287,564	265,639	262,454
Non controlling interests	10	10	10
Total shareholders equity	287,574	265,649	262,465
Total liabilities, shareholders' equity and minority interests	382,706	333,263	358,165

Consolidated Statements of Cash Flow

CONFORM IFRS	Quarter ended	Quarter ended	Year ended
	31/03/2017	31/03/2016	31/12/2016
(in k EUR)			audited
Cash flow from operating activities Net income	25,442	22,836	96,257
Adjustments for :
Operating activities	6,200	5,959	14,520
Deferred taxes	-757	1,093	-13,093
Capital grants	121	174	896
Depreciation and amortisation	7,220	5,476	25,872
Unrealized exchange results	1,630	-415	-452
Financial result	-2,014	-368	1,298
Operating profit before working capital changes	31,642	28,794	110,777
A/R, Trade	5,778	-1,541	-15,047
A/R, affiliates	-8,775	-8,321	1,581
Other current assets	-1,932	-1,291	-5,147
Other non current assets	-1	1	1
Inventories	-3,665	1,742	-15,479
A/P	-978	3,223	4,323
A/P affiliates	2,418	495	3,760
Accrued expenses	2,674	3,516	29,619
Other current liabilities	232	-1,569	-633
Other non current liabilities	485	-691	-976
Interest paid	-94	-69	-294
Income tax	-5,368	-1,532	-4,533
Cash flow from operating activities	22,413	22,756	107,951
Cash flow from investing activities
Acquisition of subsidiary, net of cash acquired
Financial fixed assets
Purchase of PPE and intangible assets (netted)	-6,390	-7,684	-28,774
Interest received	3	17	172
Investments/proceeds/ from current investments	158		-109
(incl. financial instruments)
Cash provided from investing activities	-6,229	-7,667	-28,711
Cash flows from financing activities
Payment to acquire own shares
Proceeds/Repayment of long-and short-term debt	-42	-47	-46
Proceeds/Repayment of bank loans and overdrafts
Proceeds from (repayment of) related party financing
Impact of exchange results on financing items	115	1,114	-1,135
Dividend payment			-76,102
Capital Decrease
Non controlling interests
Cash provided from financing activities	73	1,068	-77,284
CTA	-2	-14	-5
Increase/decrease in cash and cash equivalents	16,255	16,143	1,952
Cash at beginning of the period Cash at the end of the period	75,789 92,045	73,838 89,981	73,838 75,789

Sales per Geography

	Q1/17	Q1/16	Q4/16	FY 2016
APAC Asia Pacific	48%	43%	51%	47%
EMEA Europe - Middle-East - Africa	40%	43%	37%	39%
NALA North America - Latin America	12%	14%	12%	14%
TOTAL	100%	100%	100%	100%