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Scanfil Oyj
Interim / Quarterly Report • Oct 25, 2024
3290_ir_2024-10-25_e9c9c694-7fe1-4650-b55b-ed36382d6a11.pdf
Interim / Quarterly Report
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Scanfil plc January-September 2024 Interim report
25 OCTOBER 2024
Scanfil Group's interim report for January–September 2024
Scanfil continues to succeed in defending its profit margin in challenging market
July–September
- Turnover totaled EUR 173.3 million (212.8), a decrease of 18.6%
- Adjusted operating profit was EUR 12.4 (15.2) million, a decrease of 18.4 %. Operating profit was EUR 12.1 (15.2) million, a decrease of 20.4%
- Adjusted 0perating profit margin was 7.2% (7.2%). Operating profit margin was 7.0% (7.2%)
- Earnings per share were EUR 0.13 (0.17)
January–September
- Turnover totaled EUR 567.7 million (680.7), a decrease of 16.6%
- Adjusted operating profit was EUR 39.1 (47.9) million, a decrease of 18.4%. Operating profit was EUR 38.8 (47.9) million, a decrease of 19.1%
- Adjusted operating profit margin was at 6.9% (7.0%). Operating profit margin was at 6.8% (7.0%)
- Earnings per share were EUR 0.45 (0.57)
- Net debt/EBITDA was 0.15 (1.01)
Outlook for 2024
Scanfil updated its outlook for 2024 on 10 June. Scanfil estimates its turnover to be EUR 780–840 (previous, issued on 23 February: 820–900) million, and an adjusted operating profit of EUR 54–61 (57–65) million.
| Q3 2024 | Q3 2023 | Change,% | 1-9 2024 | 1-9 2023 | Change,% | 2023 | |
|---|---|---|---|---|---|---|---|
| Turnover, EUR million | 173.3 | 212.8 | -18.6 | 567.7 | 680.7 | -16.6 | 901.6 |
| Operating Profit, EUR million | 12.1 | 15.2 | -20.4 | 38.8 | 47.9 | -19.1 | 61.3 |
| Operating Profit, adjusted, EUR million | 12.4 | 15.2 | -18.4 | 39.1 | 47.9 | -18.4 | 61.3 |
| Operating Profit, % | 7.0 | 7.2 | 6.8 | 7.0 | 6.8 | ||
| Operating Profit, adjusted, % | 7.2 | 7.2 | 6.9 | 7.0 | 6.8 | ||
| Net Profit, EUR million | 8.7 | 11.0 | -20.7 | 29.4 | 37.3 | -21.4 | 48.2 |
| Net Profit, adjusted, EUR million | 9.1 | 11.0 | -17.9 | 29.7 | 37.3 | -20.5 | 48.2 |
| Earnings per Share, EUR | 0.13 | 0.17 | -20.8 | 0.45 | 0.57 | -21.5 | 0.74 |
| Earnings per Share, adjusted, EUR | 0.14 | 0.17 | -18.0 | 0.46 | 0.57 | -20.7 | 0.74 |
| Return on Equity, % | 14.3 | 21.0 | -31.9 | 19.6 | |||
| Return on Equity, adjusted, % | 14.5 | 21.0 | -31.0 | 19.6 | |||
| Equity Ratio, % | 58.2 | 47.8 | 21.8 | 53.7 | |||
| Net Gearing, % | 4.0 | 32.6 | -87.7 | 19.4 | |||
| Net debt / EBITDA | 0.15 | 1.01 | -85.1 | 0.64 | |||
| Net Cash Flow from Operations, EUR million | 21.8 | 9.7 | 123.8 | 68.7 | 34.1 | 101.6 | 68.9 |
| Employees, Average | 3,535 | 3,716 | -4.9 | 3,671 |
Adjusted items are non-recurring significant items that deviate from normal business operations, which affects the comparability between different periods. Adjusted items in January-September include costs related to the acquisition of SRXGlobal Pty Ltd. (EUR 0.3 million).
CHRISTOPHE SUT, CEO:
"The third quarter was solid for Scanfil and we continued to deliver the long-term operating margin target of 7%- 8% despite a challenging market situation.
As market demand remained slow during the third quarter, the Scanfil team focused on operational efficiency. We secured a solid 7.2% operating margin and generated a net cash flow from operations EUR 21.8 million, resulting from continuous disciplined inventory management.
At the end of the third quarter our financial position was solid. Gearing was 4% (32.6%), and the equity ratio was 58.2% (47.8%). Inventory management improved and inventories were reduced by EUR 9 million in the third quarter. Compared to the end of September last year, inventories decreased by EUR 51.4 million. Our net debt level is down to 0.15 times EBITDA, well below our longterm target of 1.5. Our strong performance allows us to look at potential future investments to support the growth.
On the customer side, we were strong. On-time delivery remained at the high level of 97.9%. We continued to focus on winning new contracts and had another very active quarter in sales, winning new projects with an annualized value of EUR 41.7 million in the third quarter and EUR 126.1 million in January- September 2024.
The Industrial segment was negatively impacted by endcustomer demand and customer destocking. We continue to work closely with our customers to adjust our operations and inventory to the market situation. We won new projects with an annualized value of EUR 17.5 million in the third quarter and EUR 51.6 million in January-September.
The continuation of destocking negatively affected the Energy & Cleantech segment. However, the segment's long-term development remains positive, and we won projects in the third quarter with an annualized value of
EUR 16.1 million and EUR 53.8 million in January-September.
The Medtech & Life Science segment's turnover was expected to be higher even though the drop was less than in other segments. However, we won new contracts with existing and new customers for an annualized value of EUR 8.1 million in the third quarter and EUR 20.6 million in January-September. We have increased our focus on this segment and brought new expertise in sales, quality and project management.
On the strategic front, we announced changes in our management team to secure scalability and realize our growth potential. The evolution was smooth. All newly appointed executives came inside the company with extensive experience and are strongly motivated to take Scanfil to the next level.
After the third quarter, we announced our first acquisition since 2019. SRXGlobal is a perfect match for Scanfil, offering a complementary footprint in the APAC region with excellent growth potential. We can further develop the Malaysian operations and benefit from a complementary customer portfolio. Since the acquisition on 3 October, our teams have engaged with customers to show the value SRX and Scanfil can bring in terms of complementary customer offerings. The acquisition was the first step to implementing our acquisition strategy, and our financial position will allow us to continue to look for new M&A opportunities.
We are gradually seeing customer demand stabilizing even if the rebound has proven to be slower than expected. We believe the fourth quarter will be the strongest quarter of the year.
Finally, our team has shown strong commitment to implementing the strategy and reaching our targets in a challenging market situation. We are building our strength through efficiency improvements, new customer contracts, and M&A."
Scanfil Group's interim report for January-September 2024
TURNOVER
The turnover for July–September was EUR 173.3 (212.8) million, a decrease of 18.6% compared to the previous year's comparison period. The turnover decreased by EUR 39.5 million of which EUR 1.3 million were spot market purchases. Excluding spot market purchases, turnover decreased by 18.0%.
The turnover for January–September was EUR 567.7 (680.7) million, a decrease of 16.6% compared to the previous year's comparison period. The turnover decreased by EUR 113.1 million of which EUR 12.1 million were spot market purchases. Excluding spot market purchases, turnover decreased by 15.2%.
In January–September, the largest customer accounted for about 12% (13%) of turnover and the top ten customers accounted for about 55% (57%) of turnover.
TURNOVER BY CUSTOMER SEGMENT
Industrial
Turnover in July–September was EUR 83.9 (98.8) million, a decrease of 15.1% compared to the same period in 2023. Turnover in January– September was EUR 268.5 (322.5) million, a decrease of 16.7% compared to the same period in 2023. The general economic situation has negative impact on certain end-customers demand.
Energy & Cleantech
Turnover in July–September was EUR 55.6 (77.6) million, a decrease of 28.4% compared to the same period in 2023. Turnover in January–September was EUR 193.4 (241.7) million, a decrease of 20.0% compared to the same period in 2023. Improved semiconductor availability in the second half of 2023 boosted the demand and drove to overstocking, which is still impacting on the turnover of the period.
Medtech & Life Science
Turnover in July–September was EUR 33.8 (36.4) million, a decrease of 6.9% compared to the same period in 2023. Turnover in January–September was EUR 105.8 (116.6) million, a decrease of 10.7% compared to the same period in 2023. The drop was mainly caused by a strong comparison period in 2023.
OPERATING PROFIT
Operating profit, EUR million
The adjusted operating profit for July-September was EUR 12.4 (15.2) million. The operating profit was impacted by lower turnover. The company continued to keep a high focus on its operational costs and adapted them to demand. As a result of those actions the adjusted operating margin was at the target level 7.2% (7.2%) of turnover. Operating profit was adjusted with EUR 0,3 million acquisition costs related to SRX transaction which realized in the fourth quarter. The operating profit for July-September was EUR 12.1 (15.2) million, 7.0% (7.2%) of turnover.
The adjusted operating profit for January– September was EUR 39,1 (47.9) million, 6.9% (7.0%) of turnover. The adjusted operating profit was negatively impacted by EUR 0.6 million foreign exchange rate change and lay off costs EUR 0.5 million which impacted the adjusted operating margin by 0.2%. The company has adapted its operational costs to reflect the changes in
demand and adjusted operating profit margin without impact of lay-off costs and foreign exchange rate change exceeded the previous year's level. Operating profit was adjusted for EUR 0,3 million acquisition costs related to SRX transaction, which realized in the fourth quarter. The operating profit for January–September was EUR 38.8 (47.9) million, 6.8% (7.0%) of turnover.
NET PROFIT AND EARNINGS
The net profit for July-September was EUR 8.7 (11.0) million, a decrease of 20.7%. Earnings per share were EUR 0.13 (0.17). The net profit for January– September was EUR 29.4 (37.3) million, a decrease of 21.4%. Earnings per share were EUR 0.45 (0.57). Return on investment was 15.9% (19.9%).
The effective tax rate in January–September was 24.2% (21.4%). The difference in the rates consist of the negative adjustment of the taxes of Poland Special Economic Zone and tax refund resulting of mutual agreement process in 2023 regarding the tax year 2014 in Poland. Total impact of these were 2,0% in the tax rate. Otherwise, the tax rate represents the weighted average tax rates including the withholding taxes for the dividends.
FINANCING AND CAPITAL EXPENDITURE
Scanfil has a strong financial position. The consolidated balance sheet total was EUR 498.3 (541.8) million at the end of the review period. Cash and cash equivalents totaled EUR 51.8 (13.6) million. Liabilities amounted to EUR 217.8 (294.2) million, of which non-interestbearing liabilities totaled EUR 154.9 (199.9) million and interest-bearing liabilities totaled EUR 62.9 (94.4) million. Interest-bearing liabilities consisted of EUR 41.9 (73.1) million in liabilities from financial institutions and EUR 21.0 (21.2) million in leasing liabilities. The Group has a strong liquidity position with EUR 91.1 million in unused credit facilities.
The equity ratio at the end of the period was 58.2% (47.8%), and net gearing was 4.0% (32.6%). Net debt to EBITDA was 0.15 (1.01). Equity per share was EUR 4.30 (3.79).
The Group's financial arrangement includes discharge covenants related to equity ratio and interest-bearing net debt/EBITDA ratio. Compliance with the terms of the covenants is reviewed quarterly. At the end of the period
under review, the terms have been complied with.
The net cash flow from operating activities for January–September was EUR 68.7 (34.1) million. The positive change resulted from the EUR 35.4 million impact of the reduction in the inventory values.
The net cash flow from investing activities in January– September was EUR -11.6 (-17.8) million. Scanfil invested in the Dream Factory manufacturing efficiency program and necessary capacity replacement. Sieradz factory expansion has been postponed corresponding to the prevailing demand environment.
Free cash flow was EUR 57.1 (16.0) million.
The cash flow from financing activities was EUR -26.6 (-23.0) million, including a EUR -15.0 (-13.6) million dividend payment, EUR -6.0 (-6.0) million in repayments of long-term loans, changes in the leasing liabilities of EUR -3.0 (-3.1) million and change in overdraft facility EUR -2.5 (-1.5) million.
Gross investments in January–September totaled EUR 11.9 (18.1) million, which was 2.1% (2.7%) of the turnover. Depreciations, including impairments, totaled EUR 15.2 (14.2) million.
DECISIONS FROM THE ANNUAL GENERAL MEETING AND BOARD OF DIRECTORS' AUTHORIZATION
The Annual General Meeting held on 25 April 2024 authorized the Board of Directors to decide on the acquisition of the company's own shares and to decide on share issue, granting shares and issuing special rights entitling to shares.
The Board of Directors' proposals for the General Meetings and the minutes are available on the company's website at www.scanfil.com/agm.
OWN SHARES
On 30 September 2024, the company owned 78,738 of its own shares, representing 0.1% of all shares.
SHARE TRADING AND SHARE PERFORMANCE
The number of Scanfil shares was 65,269,993 in total as of 30 September 2024 with the market value of EUR 473.2 million.
The highest trading price during January–September was EUR 8.7 and the lowest was EUR 6.72, with the closing price for the period standing at EUR 7.25 and the volume weighted average price at EUR 7.71.
PERSONNEL
At the end of the period the Group employed 3,461 (3 679). The average number of Group employees during the review period was 3,535 (3 716) people. The change was driven by the shift in turnover.
CHANGES IN GROUP STRUCTURE
There have been no changes in the Group structure during the reporting period.
FUTURE OUTLOOK
On 10 June Scanfil updated its outlook for 2024. Scanfil estimates its turnover to be EUR 780–840 (previous, issued on 23 February: 820–900) million, and an adjusted operating profit of EUR 54–61 (57–65) million.
The outlook is based on customer forecasts and Scanfil's normal forecasting process. The outlook is associated with uncertainty related to global economic development.
LONG-TERM TARGETS
Scanfil is aiming for 10% annual turnover growth and 7%-8% operating profit level while keeping its net debt/EBITDA ≤1.5. Scanfil aims to pay an increasing dividend of approximately 1/3 of the earnings per share.
OPERATIONAL RISKS AND UNCERTAINTIES
Current recognized risks are strategic risks such as uncertainties in the global economy and risks in the political environment which might prevent the company from achieving its economic targets.
Other recognized risks are related to inflation, materials prices and availability, exchange rates and cyber security. Scanfil may also be exposed to legal disputes in the jurisdictions in which it operates.
The negative development of the global economy may have an impact on Scanfil's revenue and profitability in the short to midterm. It may also have an impact on companies' financing and therefore increase the risk of credit losses.
If conflicts in Ukraine and the Middle East continue and escalate further, it might impact Scanfil and the business environment of its customers. Furthermore, other political and trade tension as well as related actions might impact Scanfil's business environment.
Overall inflation also influences the company's cost structure.
Materials availability in the market has normalized. However, any disruption in the external material supply chain could impact on the company's revenue and profitability.
The changes in foreign exchange rates are a risk to profitability. Scanfil mitigates the risk by using foreign exchange forward contracts.
Mergers and acquisitions have risks e.g. related to acquisition price, integration and future profitability of the acquired company.
Cyber security is recognized as an increasing risk. Scanfil is continuously monitoring and developing its ICT environment and systems to mitigate the risk.
The risk of energy availability and potential increases in energy costs are not expected to have a significant impact on short-term revenue or profitability.
The company's risks and risk management are described on the company's website under Corporate Governance and in the Sustainability report 2023 and notes to the consolidated financial statement for 2023.
KEY INDICATORS
| 1 -9 | 1 - 9 | 1 -12 | |
|---|---|---|---|
| 2024 | 2023 | 2023 | |
| Operating Profit, EUR million | 38.8 | 47.9 | 61.3 |
| Operating Profit, adjusted, EUR million | 39.1 | 47.9 | 61.3 |
| Return on equity, % | 14.3 | 21.0 | 19.6 |
| Return on investment, % | 15.9 | 19.9 | 19.4 |
| Interest-bearing liabilities, EUR million | 62.9 | 94.4 | 73.0 |
| Net gearing, % | 4.0 | 32.6 | 19.4 |
| Equity ratio, % | 58.2 | 47.8 | 53.7 |
| Gross investments, EUR million | 11.9 | 18.1 | 22.2 |
| % of net turnover | 2.1 | 2.7 | 2.5 |
| Personnel, average | 3,535 | 3,716 | 3,671 |
| Earnings per share, EUR | 0.45 | 0.57 | 0.74 |
| Shareholders´ equity per share, EUR | 4.30 | 3.79 | 4.08 |
| Number of shares at | |||
| the end of period, 000´s | |||
| - not counting own shares | 65,191 | 65,171 | 65,191 |
| - weighted average | 65,191 | 65,095 | 64,864 |
Owing to the nature of the sector, the company´s order book covers only a short period of time and does not give an accurate picture of future development.
KEY INDICATORS QUARTERLY
| Q3/24 | Q2/24 | Q1/24 | Q4/23 | Q3/23 | Q2/23 | Q1/23 | Q4/22 | Q3/22 | |
|---|---|---|---|---|---|---|---|---|---|
| Turnover, MEUR | 173.3 | 195.5 | 198.9 | 220.8 | 212.8 | 243.3 | 224.6 | 222.3 | 211.9 |
| Operating profit, MEUR | 12.1 | 13.9 | 12.7 | 13.4 | 15.2 | 17.5 | 15.1 | 13.4 | 11.5 |
| Operating profit, % | 7.0 | 7.1 | 6.4 | 6.1 | 7.2 | 7.2 | 6.7 | 6.0 | 5.4 |
| Net income, MEUR | 8.7 | 10.8 | 9.8 | 10.9 | 11.0 | 14.5 | 11.8 | 10.5 | 9.4 |
CALCULATION OF KEY INDICATORS
| Return on equity, % | Net profit for the period* x 100 |
|---|---|
| Shareholders' equity (average) | |
| Adjusted return on equity % | Adjusted net profit for the period* x 100 |
| Adjusted shareholders' equity (average) | |
| Return on investment, % | (Profit before taxes + interest and other financial expenses)* x 100 |
| Balance sheet total - non-interest-bearing liabilities (average) | |
| Net gearing (%) | (Interest-bearing liabilities - cash and other liquid financial assets) x 100 |
| Shareholders' equity | |
| Equity ratio (%) | Shareholders' equity x 100 |
| Balance sheet total - advance payments received | |
| Net debt | Interest-bearing liabilities + lease liabilities - cash and cash equivalents |
| EBITDA | Operating Profit + Depreciations and amortizations |
| Earnings per share | Net profit for the period |
| Average adjusted number of shares during the year | |
| Shareholders' equity per share | Shareholders' equity |
| Adjusted number of shares at the end of the financial period | |
| Dividend per share | Dividend to be distributed for the period (Board's proposal) |
| Number of shares at the end of year | |
| Dividend per earnings (%) | Dividend per share x 100 |
| Earnings per share | |
| Effective dividend yield (%) | Dividend per share x 100 |
| Share price at the end of year | |
| Price-to-earnings ratio (P/E) | Share price at the end of year |
| Earnings per share | |
| Average share price | Total share turnover |
| Number of shares traded | |
| Market capitalisation | Number of shares x last trading price of the financial period |
| Adjusted item | A non-recurring significant item that deviates from normal business |
| operations, which affects the comparability between different periods |
* Year-to-date annualized
CONDENSED CONSOLIDATED INCOME STATEMENT
| 7 - 9 | 7 - 9 | 1 - 9 | 1 - 9 | 1 - 12 | |
|---|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | 2023 | |
| EUR million Note |
|||||
| Turnover 1 |
173.3 | 212.8 | 567.7 | 680.7 | 901.6 |
| Other operating income | 0.3 | 0.4 | 0.7 | 0.7 | 0.9 |
| Changes in inventories of finished goods and work in progress |
-0.1 | 2.1 | -1.1 | 3.6 | -0.3 |
| Expenses | -156.2 | -195.3 | -513.4 | -623.0 | -821.7 |
| Depreciation and amortization | -5.1 | -4.8 | -15.2 | -14.2 | -19.1 |
| Operating profit | 12.1 | 15.2 | 38.8 | 47.9 | 61.3 |
| Financial income and expenses | -0.2 | -0.7 | 0.0 | -0.3 | 0.3 |
| Profit before taxes | 11.9 | 14.6 | 38.8 | 47.5 | 61.6 |
| Income taxes | -3.1 | -3.5 | -9.4 | -10.2 | -13.4 |
| Net profit for the period | 8.7 | 11.0 | 29.4 | 37.3 | 48.2 |
| Attributable to: | |||||
| Equity holders of the parent | 8.7 | 11.0 | 29.4 | 37.3 | 48.2 |
| Earnings per share for profit attributable to | |||||
| shareholders of the parent: | |||||
| undiluted (EUR) | 0.13 | 0.17 | 0.45 | 0.57 | 0.74 |
| diluted ( EUR) | 0.13 | 0.17 | 0.45 | 0.57 | 0.74 |
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
| 7 - 9 | 7 - 9 | 1 - 9 | 1 - 9 | 1 - 12 | |
|---|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | 2023 | |
| EUR million | |||||
| Net profit for the period | 8.7 | 11.0 | 29.4 | 37.3 | 48.2 |
| Items that may later be recognized in profit or loss | |||||
| Translation differences | 0.0 | -1.8 | 0.5 | -3.6 | 3.0 |
| Cash flow hedges | -0.1 | -1.3 | -0.7 | -0.8 | 0.0 |
| Other comprehensive income, net of tax | -0.1 | -3.1 | -0.2 | -4.5 | 2.9 |
| Total Comprehensive Income | 8.6 | 7.9 | 29.2 | 32.9 | 51.2 |
| Attributable to: | |||||
| Equity holders of the parent | 8.6 | 7.9 | 29.2 | 32.9 | 51.2 |
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
| EUR million | Note | 30.9.2024 | 30.9.2023 | 31.12.2023 |
|---|---|---|---|---|
| Assets | ||||
| Non-current assets | ||||
| Property, plant and equipment | 2 | 64.1 | 62.4 | 62.7 |
| Right-of-use asset | 2 | 20.8 | 21.2 | 22.6 |
| Goodwill | 3 | 7.6 | 7.5 | 7.7 |
| Other intangible assets | 9.1 | 9.3 | 10.4 | |
| Available-for-sale investments | 0.5 | 0.5 | 0.5 | |
| Deferred tax assets | 7.1 | 8.0 | 7.7 | |
| Total non-current assets | 109.3 | 109.0 | 111.6 | |
| Current assets | ||||
| Inventories | 173.9 | 225.3 | 209.0 | |
| Trade and other receivables | 157.7 | 190.1 | 173.5 | |
| Advance payments | 2.0 | 1.6 | 0.9 | |
| Current tax | 3.6 | 2.3 | 1.8 | |
| Cash and cash equivalents | 51.8 | 13.6 | 21.2 | |
| Total current assets | 388.9 | 432.9 | 406.4 | |
| Total assets | 498.3 | 541.8 | 518.0 | |
| 30.9.2024 | 30.9.2023 | 31.12.2023 | ||
| Shareholder's equity and liabilities | ||||
| Equity attributable to equity holders of the parent | ||||
| Share capital | 2.0 | 2.0 | 2.0 | |
| Reserve for invested unrestricted equity fund | 34.8 | 34.7 | 34.8 | |
| Fair value reserve | 0.2 | 0.1 | 0.9 | |
| Other reserves | 2.6 | 2.6 | 2.6 | |
| Translation differences | -4.1 | -11.2 | -4.6 | |
| Retained earnings | 244.9 | 219.3 | 230.2 | |
| Total equity | 280.5 | 247.6 | 266.0 | |
| Non-current liabilities | ||||
| Deferred tax liabilities | 6.7 | 5.4 | 5.7 | |
| Provisions | 1.1 | 1.0 | 1.1 | |
| Interest bearing liabilities | 30.0 | |||
| Lease liability | 16.5 | 19.3 | 18.6 | |
| Total non-current liabilities | 24.3 | 55.7 | 25.4 | |
| Current liabilities | ||||
| Trade and other liabilities | 144.9 | 187.5 | 166.7 | |
| Current tax | 1.6 | 5.4 | 4.9 | |
| Provisions | 0.7 | 0.5 | 0.6 | |
| Interest bearing liabilities | 41.9 | 43.1 | 50.4 | |
| Lease liability | 4.5 | 1.9 | 3.9 | |
| Total current liabilities | 193.5 | 238.5 | 226.6 | |
| Total liabilities | 217.8 | 294.2 | 252.0 | |
| Total shareholder's equity and liabilities | 498.3 | 541.8 | 518.0 |
STATEMENT OF CHANGES IN CONSOLIDATED EQUITY
Equity attributable to equity holders of the parent company
| Reserve for invested |
Reserve | Translation | Retained | Equity | |||
|---|---|---|---|---|---|---|---|
| EUR million | Share | Fair | |||||
| unrestricted | value | ||||||
| Equity | capital | equity fund | reserve | fund | differences | earnings | total |
| 1.1.2024 | 2.0 | 34.8 | 0.9 | 2.6 | -4.6 | 230.2 | 266.0 |
| Total comprehensive | -0.7 | 0.5 | 29.4 | 29.2 | |||
| income | |||||||
| Paid dividend | -15.0 | -15.0 | |||||
| Option scheme | 0.3 | 0.3 | |||||
| Equity | |||||||
| 30.9.2024 | 2.0 | 34.8 | 0.2 | 2.6 | -4.1 | 244.9 | 280.5 |
Equity attributable to equity holders of the parent company
| EUR million Equity 1.1.2023 |
Share capital 2.0 |
Reserve for invested unrestricted equity fund 33.4 |
Fair value reserve 1.0 |
Reserve fund 2.6 |
Translation differences -7.6 |
Retained earnings 195.1 |
Equity total 226.6 |
|---|---|---|---|---|---|---|---|
| Total comprehensive income |
-0.8 | -3.6 | 37.3 | 32.9 | |||
| Paid dividend | -13.6 | -13.6 | |||||
| Option scheme | 0.5 | 0.5 | |||||
| Share options exercised |
1.3 | 1.3 | |||||
| Equity 30.9.2023 |
2.0 | 34.7 | 0.1 | 2.6 | -11.2 | 219.3 | 247.6 |
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
| 1.1.-30.9.2024 | 1.1.-30.9.2023 | 1.1.-31.12.2023 | |
|---|---|---|---|
| EUR million | |||
| Cash flow from operating activities | |||
| Net profit | 29.4 | 37.3 | 48.2 |
| Adjustments for the net profit | 26.2 | 28.1 | 35.7 |
| Change in net working capital | 27.3 | -22.2 | -2.6 |
| Paid interests and other financial expenses | -1.7 | -2.8 | -3.6 |
| Received interest and other financial income | 0.6 | 0.4 | 0.5 |
| Taxes paid | -13.1 | -6.8 | -9.2 |
| Net cash from operating activities | 68.7 | 34.1 | 68.9 |
| Cash flow from investing activities | |||
| Investments in tangible and intangible assets | -11.9 | -18.1 | -22.2 |
| Sale of tangible and intangible assets | 0.3 | 0.3 | 0.3 |
| Net cash from investing activities | -11.6 | -17.8 | -21.9 |
| Cash flow from financing activities | |||
| Related-party investment company shares | 1.3 | 1.4 | |
| Repayment of long-term loans | -6.0 | -6.0 | -6.0 |
| Proceeds from short term loans | -2.5 | -1.5 | |
| Repayment of short-term loans | -0.1 | -24.0 | |
| Repayment of lease liabilities | -3.0 | -3.1 | -4.2 |
| Dividends paid | -15.0 | -13.6 | -13.6 |
| Net cash from financing activities | -26.6 | -23.0 | -46.4 |
| Net increase/decrease in cash and cash equivalents | 30.5 | -6.8 | 0.6 |
| Cash and cash equivalents at beginning of period | 21.2 | 20.8 | 20.8 |
| Changes in exchange rates | 0.0 | -0.4 | -0.2 |
| Cash and cash equivalents at end of period | 51.8 | 13.6 | 21.2 |
ADJUSTMENT CALCULATIONS TO OPERATING AND NET PROFIT, AND EQUITY
| 7 - 9 | 7 - 9 | 1 - 9 | 1 - 9 | 1 - 12 | |
|---|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | 2023 | |
| EUR million | |||||
| Operating profit | 12.1 | 15.2 | 38.8 | 47.9 | 61.3 |
| Operating profit, % of turnover | 7.0 % | 7.2 % | 6.8 % | 7.0 % | 6.8 % |
| Adjustment items: | |||||
| Expenses | 0.3 | 0.3 | |||
| Total adjustment items | 0.3 | 0.3 | |||
| Adjusted operating profit | 12.4 | 15.2 | 39.1 | 47.9 | 61.3 |
| Adjusted operating profit, % of turnover | 7.2 % | 7.2 % | 6.9 % | 7.0 % | 6.8 % |
| Financial income and expenses | -0.2 | -0.7 | 0.0 | -0.3 | 0.3 |
| Profit before taxes | 11.9 | 14.6 | 38.8 | 47.5 | 61.6 |
| Income taxes | -3.1 | -3.5 | -9.4 | -10.2 | -13.4 |
| Net profit for the period | 8.7 | 11.0 | 29.4 | 37.3 | 48.2 |
| Earnings per share, EUR | 0.13 | 0.17 | 0.45 | 0.57 | 0.74 |
| Adjusted net profit for the period | 9.1 | 11.0 | 29.7 | 37.3 | 48.2 |
| Adjusted earnings per share, EUR | 0.14 | 0.17 | 0.46 | 0.57 | 0.74 |
| Equity | 280.5 | 247.6 | 266.0 | ||
| Return on equity, % | 14.3 % | 21.0 % | 19.6 % | ||
| Adjustment items: | |||||
| Net profit for the period | 0.3 | ||||
| Adjusted equity | 280.8 | 247.6 | 266.0 | ||
| Adjusted return on equity, % | 14.5 % | 21.0 % | 19.6 % |
Notes to the interim report
ACCOUNTING PRINCIPLES
The Group's interim report has been prepared in compliance with the IAS 34 Interim Financial Reporting standard. The report complies with the accounting principles as in the Financial Statement for 2023. All individual figures and totals presented in tables have been rounded, due to which the total sum of individual figures may differ from the sum presented. The key figures have been calculated using precise values. This report is unaudited.
In its meeting held on October 24, 2024, the Board of Directors of Scanfil plc approved this interim report for publication.
1. DISAGGREGATION OF REVENUES
| 7 -9 | 7 -9 | |||||
|---|---|---|---|---|---|---|
| 2024 | 2023 | |||||
| Goods | Services | Total | Goods | Services | Total | |
| Customer Segments | ||||||
| Industrial | 75.4 | 8.3 | 83.6 | 90.5 | 8.3 | 98.8 |
| Energy & Cleantech | 54.6 | 0.9 | 55.5 | 76.2 | 1.4 | 77.6 |
| Medtec & Life Science | 32.3 | 1.9 | 34.2 | 35.0 | 1.3 | 36.4 |
| Total | 162.3 | 11.0 | 173.3 | 201.8 | 11.0 | 212.8 |
| Timing of revenue recognition | ||||||
| Goods and services transferred at a point of time |
162.3 | 10.8 | 173.0 | 201.8 | 10.4 | 212.2 |
| Services transferred over time | 0.2 | 0.2 | 0.6 | 0.6 | ||
| Total | 162.3 | 11.0 | 173.3 | 201.8 | 11.0 | 212.8 |
| 1 - 9 | 1 - 9 | |||||
|---|---|---|---|---|---|---|
| 2024 | 2023 | |||||
| Goods | Services | Total | Goods | Services | Total | |
| Customer Segments | ||||||
| Industrial | 243.1 | 25.3 | 268.5 | 296.4 | 26.1 | 322.5 |
| Energy & Cleantech | 190.8 | 2.6 | 193.4 | 238.0 | 3.7 | 241.7 |
| Medtec & Life Science | 99.9 | 5.9 | 105.8 | 111.1 | 5.4 | 116.6 |
| Total | 533.9 | 33.8 | 567.7 | 645.5 | 35.3 | 680.7 |
| Timing of revenue recognition | ||||||
| Goods and services transferred at a point of time |
533.9 | 32.7 | 566.5 | 645.5 | 33.2 | 678.7 |
| Services transferred over time | 1.1 | 1.1 | 2.0 | 2.0 | ||
| Total | 533.9 | 33.8 | 567.7 | 645.5 | 35.3 | 680.7 |
2. CHANGES IN TANGIBLE NON-CURRENT ASSETS
| 1 - 9 | 1 - 9 | 1 - 12 | |
|---|---|---|---|
| 2024 | 2023 | 2023 | |
| EUR million | |||
| Book value at the beginning of the period | 85.3 | 79.7 | 79.7 |
| Additions | 12.5 | 17.0 | 20.9 |
| Deductions | -0.2 | -0.2 | -0.2 |
| Depreciations and decreases in value | -13.2 | -12.3 | -16.5 |
| Exchange rate differences | 0.6 | -0.6 | 1.4 |
| Book value at the end of the period | 85.0 | 83.7 | 85.3 |
3. CHANGES IN GOODWILL
| 1 - 9 | 1 - 9 | 1 - 12 | |
|---|---|---|---|
| 2024 | 2023 | 2023 | |
| EUR million | |||
| Book value at the beginning of the period | 7.7 | 7.7 | 7.7 |
| Exchange rate differences | -0.1 | -0.2 | 0.0 |
| Book value at the end of the period | 7.6 | 7.5 | 7.7 |
4. FINANCIAL ASSETS AND LIABILITIES, CARRYING AMOUNT AND FAIR VALUE
| 30.9.2024 | 30.9.2024 | |
|---|---|---|
| Book values of | Fair values of | |
| EUR million | balance sheet values | balance sheet values |
| Non-current assets | ||
| Investments | 0.5 | 0.5 |
| Non-current assets total | 0.5 | 0.5 |
| Current assets | ||
| Trade receivables | 145.4 | 145.4 |
| Derivatives | 0.3 | 0.3 |
| Cash and cash equivalents | 51.8 | 51.8 |
| Current assets total | 197.4 | 197.4 |
| Total financial assets | 197.9 | 197.9 |
| Non-current financial liabilities | ||
| Lease liability | 16.5 | 16.5 |
| Non-current financial liabilities total | 16.5 | 16.5 |
| Current financial liabilities | ||
| Interest bearing liabilities from financial institutions | 30.0 | 30.0 |
| Total financial liabilities | 161.0 | 161.0 |
|---|---|---|
| Current financial liabilities total | 144.4 | 144.4 |
| Derivatives | 0.4 | 0.4 |
| Trade payables | 97.7 | 97.7 |
| Lease liability | 4.5 | 4.5 |
| Loans withdrawn from the credit limit | 11.9 | 11.9 |
The valuation of derivatives is based on market data (level 2).
The valuation of investments is based on the acquisition cost (level 3) as the fair value of the shares cannot be determined reliably.
5. OPEN DERIVATIVE CONTRACTS
| 30.9.2024 | 30.9.2023 | ||||
|---|---|---|---|---|---|
| Fair net value | Nominal value | Fair net value | Nominal value | ||
| EUR million | |||||
| Interest rate swaps | - | - | 0.2 | 6.0 | |
| Forward exchange contracts | 0.3 | 30.4 | 0.0 | 31.5 | |
| Forward exchange contracts, outside hedge accounting |
-0.4 | 116.5 | -0.3 | 204.9 |
6. CONTINGENT LIABILITIES
| 30.9.2024 | 30.9.2023 | 31.12.2023 | |
|---|---|---|---|
| EUR million | |||
| Pledged guarantees | 1.0 | 0.8 | 0.8 |
Scanfil plc has given guarantees to Nordea Bank Abp as security for payment of the liabilities which Scanfil Sweden AB has created from time to time towards Nordea Bank Abp on the basis of derivative contracts concluded, as well as to Skandinaviska Enskilda Banken AB replacing the previous liabilities of Scanfil Sweden AB. The maximum liability to Skandinaviska Enskilda Banken AB is EUR 3.6 million. Scanfil plc has provided a guarantee to Nordea Bank Abp as security for the performance and payment of obligations under the derivative contracts concluded between Scanfil Electronics GmbH and Nordea Bank Abp. Scanfil plc has given a guarantee for the lease obligations of its subsidiary Scanfil Inc.
Scanfil EMS Oy has given a guarantee to Nordea Bank AB Shanghai Branch of any obligations arising from a loan facility of CNY 180 million between the subsidiary Scanfil (Suzhou) Co., Ltd. and the Nordea Bank AB Shanghai Branch. Scanfil EMS Oy has given a guarantee of any obligations arising from the subsidiary's delivery contracts with its customers. The guarantee is limited to a maximum of EUR 7.5 million and seven years after the expiry of the last product agreement.
Scanfil Sweden AB has given a guarantee to the lessor as security for the liabilities under the lease contract regarding the premises leased by the Polish subsidiary Scanfil Poland Sp. z o.o.
Scanfil EMS Oy and Scanfil Sweden AB have provided guarantees to Nordea Bank Abp and Nordea Bank AB Shanghai Branch as security for the performance and payment of the obligations under the derivative master agreements entered into between the Group companies Scanfil Oü, Scanfil Poland Sp. z o.o, Scanfil Åtvidaberg AB, Scanfil Malmö AB, Scanfil (Suzhou) Co., Ltd. and Nordea Bank Abp.
On behalf of the group companies may be given usual parent company guarantees from time to time as security for the fulfillment of their customer agreement obligations.
EVENTS AFTER THE REVIEW PERIOD
On October 3, 2024, Scanfil acquired SRXGlobal for EUR 23.3 million (USD 25.7 million) with liquid cash assets. In addition, the seller is entitled to a total earnout of maximum EUR 10.5 million. SRX has two well-situated factories in Melbourne, Australia and Johor Bahru, Malaysia. Its turnover 1 July 2023–30 June 2024 was EUR 39 million and operating profit EUR 2.7 million.
SCANFIL PLC
Christophe Sut, CEO Tel +46 721 51 75 02
Scanfil is an international manufacturing partner and system supplier for the electronics industry with over 45 years of experience in demanding manufacturing. Scanfil provides its customers with an extensive array of services, ranging from product design to product manufacturing, material procurement and logistics solutions. Vertically integrated production and a comprehensive supply chain are the foundation of Scanfil's competitive advantages: speed, flexibility and reliability.
Typical Scanfil products are modules or integrated products for e.g. self-service applications, automation systems, wireless connectivity modules, climate control systems, collection and sorting systems, analyzers and environmental measurement solutions. Scanfil services are used by numerous international automations, safety, energy, cleantech and health service providers, as well as companies operating in the field of urbanization. Scanfil's network of factories consists of nine production units in Europe, Asia and North America.
Not to be published or distributed, directly or indirectly, in any country where its distribution or publication is unlawful. Forward looking statements: certain statements in this stock exchange release may constitute "forward-looking" statements which involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements of Scanfil plc to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. When used in this stock exchange release, such statements use such words as "may," "will," "expect," "anticipate," "project," "believe," "plan" and other similar terminology. New risk factors may arise from time to time, and it is not possible for management to predict all those risk factors or the extent to which any factor or
combination of factors may cause actual results, performance and achievements of Scanfil plc to be materially different from those contained in forward-looking statements. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results. The forward-looking information contained in this stock exchange release is current only as of the date of this stock exchange release. There should not be an expectation that such information will in all circumstances be updated, supplemented or revised, except as provided by the law or obligatory regulations, whether as a result of new information, changing circumstances, future events or otherwise.