Quarterly Report • Nov 5, 2008
Quarterly Report
Open in ViewerOpens in native device viewer
Consolidated Statements IFRS for the Third Quarter and First Nine Months of Fiscal 2008 as of September 30, 2008 (unaudited)
Solar
Key financial figures of the SINGULUS TECHNOLOGIES Group (SINGULUS), the order intake and order backlog, were higher in the first nine months compared with the levels achieved in the prior-year period. As of September 30, 2008, the cumulated order intake stood at € 197.5 million (previous year: € 167.6 million). Therefore the order intake nearly corresponds to the level of € 203.8 million achieved in the full business year 2007. Due to weak CD, DVD and semi-conductor activities the order intake in the 3rd quarter came to € 42.2 million, which was below the prior-year level (€ 59.1 million).
The order backlog as of September 30, 2008 rose by around 31 % to € 103.4 million (previous year: € 78.9 million). Sales came to € 68.6 million in the 3rd quarter 2008 and thus exceeded the prior-year amount of € 58.0 million as well as the respective sales in the first two quarters of the current business year. SINGULUS reached cumulated sales in the amount of € 149.9 million during the first nine months of 2008 (previous year: € 170.2 million).
The Executive Board of the SINGULUS TECHNOLOGIES AG in agreement with the Supervisory Board decided on September 17, 2008 to focus the company on the segments Optical Disc and Solar in the future. In this connection, a portfolio optimization was resolved as well as an adjustment of the balance sheet to the new economic and technologic conditions. The new positioning of SINGULUS resulted in one-time write-offs in the amount of € 41.2 million, which are not liquidity related.
With this step the base for a healthy development in the next years is formed. The write-offs taken will result in cost relieves of € 15.8 million in total in the years 2009 to 2011.
Delivery of the first Blu-ray production line to Axiom Technologies, Singapore
SINGULUS reduced the cost base significantly and adjusted capacities to the declining activities during the difficult business years 2005 to 2007. Accordingly, we already announced in November 2007 to shut-down the injection-molding machine site of SINGULUS EMOULD in Würselen as of December 31, 2007. A further analysis of the work flows and our cost situation then induced us in the current business year to also relocate the assembly of the MoldPro injection molding machines from Schaffhausen to Kahl am Main.
Since the acquisition of the first mastering activities in 2002 the market situation in this segment has changed fundamentally. The former mastering machines for CD and DVD are increasingly replaced by the new CRYSTALLINE, which can be applied for DVD and Blu-ray Disc. This relocation of the main business activities led to some valuation adjustments of assets. In this connection, the goodwill of SINGULUS MASTERING declined by € 9.8 million in the course of an impairment test pursuant to IAS 36.
Furthermore, we analyzed the opportunities and risks of our new developments and diversification efforts. As a result we already terminated our product line DECOLINE in the 1st quarter 2008. The product was not able to establish itself in the market despite good technical characteristics. At HamaTech APE in Sternenfels as well as for the product line OPTICUS, we are analyzing possible divestments.
For the HamaTech AG the decision of the court of appeal to enter the merger into the commercial register is still pending. We expect the merger of the HamaTech AG to the SINGULUS TECHNOLOGIES AG to still be executed in the current year.
Blu-ray: Driver of Growth in the Optical Disc Segment
In 2008 the global market penetration of the Blu-ray Disc has taken off successfully. Blu-ray Disc players and gaming consoles are in the meantime available at attractive prices below € 200 and around \$ 150 in the US, respectively. Almost all new movies made by Hollywood are also published in the Blu-ray Disc format and are increasingly becoming blockbusters.
According to market research institute Parks Associates, US, the global unit sales of Blu-ray players are set to break the 5 million level in 2008.
In 2007, only 800,000 Blu-ray players and in addition 800,000 HD-DVD devices were sold. Global unit sales are projected to rise to 40 million in the next five years.
SINGULUS continued to receive additional orders for Blu-ray production lines in the past quarter and expects significant growth rates with increasing earnings contributions for the Blu-ray Disc activities in the business year 2008 and the following years.
SINGULUS and STANGL successful at the 23. Photovoltaics Fair in Valencia, Spain
STANGL and SINGULUS – A Strong Team in Solar Technology SINGULUS and STANGL will systematically expand the Solar activities. Both companies complement each other ideally in being able to offer a broad product range of machines and equipment for the photovoltaics industry in the coming years. While STANGL focuses on wet-chemical processes, the core competence of SINGULUS is the physical coating technology as well as the integration of several processing steps to complete, automated production lines.
At the Photovoltaics Fair in Valencia, Spain, SINGULUS started the marketing of the new inline coating machine for silicon solar cells with the product name SINGULAR. The new machine concept was presented to all renowned solar cells producers. The machine integration know how, which SINGULUS has proven in the automation of CD, DVD and Blu-ray Disc production machines, was an optimum starting point for the development of the SINGULAR plant. The SINGULAR machine, which is produced at SINGULUS in Kahl am Main, is an important building block in the production process of solar cells. In terms of the value-added chain it ties directly to the processing steps of the machines offered by STANGL.
SINGULUS develops and manufactures equipment and machines for the production of Optical Discs as well as several machines for the manufacturing of solar cells. According to SINGULUS' announcement on September 17, 2008 the company will focus on the segments Optical Disc and Solar in the future.
The focus of the business activities in the segment Optical Disc continues to rest on the production machines for CD, DVD and Blu-ray. The main activities in the Optical Disc production is seasonally-related in the 2nd half of the year. In order to have sufficient production capacities in the last months of the calendar year, the machines have to be order before mid-year. This pattern also holds true for the ordering of machines for the production of Blu-ray Discs, which were predominantly ordered in the 1st and 2nd quarter of the current year. Nearly all orders received in the first half-year were delivered and are used by our customers for the production of Blu-ray Discs. Overall, 10 Blu-ray systems were technically accepted and realized as sales in the 3rd quarter. In the quarter under review the final acceptance test was met for the first mastering system CRYSTALLINE, which produces DVD as well as Blu-ray masters.
SINGULUS reports a continuing increase in the order intake for the Solar segment in the 3rd quarter as well. Accordingly, the order intake at STANGL rose to € 55.6 million overall in the first nine months of 2008. With its machines in the segments of wet-chemical processes STANGL covers important value-added steps in the production of solar cells – both for silicon and thin-film solar cells.
SINGULAR - Inline Deposition System for Si-Cell Production
SINGULUS is currently assembling the prototype of an innovative coating machine for the production of solar cells. The machine was developed and made marketable within a short timeframe by SINGULUS due to the technologic competence gained in the segments Optical Disc as well as Optical Coating.
We terminated our production line DECOLINE. For the production line OPTICUS we are currently assessing a possible divestment.
For the HamaTech APE, Sternenfels, we are also analyzing a disposal.
The order intake in the first nine months increased from € 167.6 million in the same period one year ago to € 197.5 million currently and accordingly as of September 30, 2008 already reached nearly the level achieved in the full-year 2007. Characterized by weak CD, DVD and semiconductor activities the order intake in the 3rd quarter 2008 came to € 42.2 million and remained below previous year's level (€ 59.1 million).
As of September 30, 2008 the order backlog increased to € 103.4 million (previous year: € 78.9 million) and is therefore considerably above the prior-year level.
In the 3rd quarter 2008 sales totaled € 68.6 million and were thus above the prior-year level (previous year: € 58.0 million) as well as the respective sales in the first and second quarter of the year under review. Sales in the first nine months came to € 149.9 million, approximately 11.9 % below the level in 2007 (€ 170.2 million). The regional breakdown of sales during the first nine months was as follows: Europe 52.8 % (previous year: 34.2 %), Asia 22.3 % (previous year: 27.7 %), North and South America 23.6 % (previous year: 35.3 %) as well as Africa and Australia 1.3 % (previous year: 2.8 %).
The percentage regional breakdown of sales for the 3rd quarter 2008 was as follows: Europe 44.4 % (previous year: 36.9 %), Asia 21.3 % (previous year: 24.3 %), North and South America 33.6 % (previous year: 35.9 %) as well as Africa and Australia 0.7 % (previous year: 2.9 %).
The gross margin in the 3rd quarter stood at 31.6 %, considerably above the level of the prior-year period (27.0 %). This increase is mainly due to the comparably high share of sales of the activities with Blu-ray replication machines in the quarter under review. In the first nine months of the business year 2008 the gross margin came to 28.1 % and is therefore at the level achieved in the prior-year period (27.7 %).
GERULUS – Wafer Block Pre-Clean & Deglue System
The operating expenses came to € 60.2 million in the 3rd quarter of the business year 2008 (previous year: € 15.2 million). During the first nine months of the year under review the operating expenses totaled € 81.8 million (previous year: € 45.0 million). This includes an extraordinary gain from the first-time consolidation of the Blu-ray activities of the Oerlikon Balzers AG (€ 15.6 million) as well as restructuring charges. The restructuring charges concern the shut-down of our business division Decorative Coating in the 1st quarter 2008 (€ 3.5 million) as well as additional adjustments in the 3rd quarter (€ 41.2 million). The restructuring charges are the result of the repositioning of the company and focusing on the business segments Optical Disc and Solar. Adjusted for these one-time impacts the operating expenses amounted to € 52.8 million in the first nine months of 2008 (previous year: € 45.0 million). For the quarter under review the operating expenses totaled € 19.0 million (previous year: € 15.2 million). The increase compared with the same period of the previous year results mainly from higher write-offs on the intangible assets, customer relationships, brands and technology following the first-time consolidation of STANGL as well as the Blu-ray Disc machine activities of the Oerlikon Balzers AG.
The earnings before interest and taxes (EBIT) before the consideration of restructuring charges in the first nine months of 2008 were positive at € 3.9 million (previous year: € 0.8 million). Taking into account the extraordinary items a negative EBIT in the amount of € 40.7 million results. In the quarter under review the EBIT before restructuring charges amounted to € 2.2 million. Including the extraordinary expenses as of September 17, 2008 SINGULUS posted a negative EBIT totaling € 39.0 million in the 3rd quarter (previous year: € 0.1 million).
In detail, sales and operating results with respect to the individual segments are split as follows:
| Segment Optical Disc |
Segment Solar |
Segment Semiconductor |
Segment Coating |
Other | SINGULUS Group |
|||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 09/30/08 09/30/07 09/30/08 09/30/07 09/30/08 09/30/07 09/30/08 09/30/07 09/30/08 09/30/07 09/30/08 09/30/07 | ||||||||||||
| Gross revenue | 111,253 | 148,808 | 24,480 | 3,328 | 14,236 | 16,700 | -69 | 1,365 | 0 | 0 | 149,900 | 170,201 |
| Sales deduction and | ||||||||||||
| direct selling costs | 3,177 | 4,001 | 314 | 13 | 172 | 580 | 0 | 6 | 0 | 0 | 3,663 | 4,600 |
| Net revenue | 108,076 144,806 | 24,166 | 3,315 | 14,064 | 16,120 | -69 | 1,359 | 0 | 0 146,237 156,600 | |||
| Negative difference from the acquisition | ||||||||||||
| of Oerlikon Blu-ray business | -15,646 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -15,646 | 0 |
| Restructuring/Impairment | 23,439 | 0 | 0 | 0 | 8,446 | 0 | 10,538 | 0 | 2,250 | 0 | 44,673 | 0 |
| EBIT | -16,864 | -856 | 1,197 | 843 -10,560 | 2,083 -11,921 | -1,252 | -2,585 | 22 -40,733 | 840 | |||
| EBITDA | 14,900 | 13,836 | 4,160 | 866 | -1,939 | 2,378 | -6,042 | -1,191 | -130 | 212 | 10,949 | 16,101 |
IMPEDIO – Wet Process System for Thin-Film Solar Cells on Foils
The long-term assets at € 203.3 million were below previous year's level (previous year: € 226.2 million). This decline is mainly due to the extraordinary write-offs in the course of the focus on the business divisions Optical Disc and Solar in the quarter under review. Specifically, the capitalized development expenses declined by € 18.3 million and the goodwill by € 10.4 million. In contrast, the other intangible assets rose by € 18.4 million. This increase is mainly based on the first-time consolidation of the Blu-ray activities acquired from the Oerlikon Balzers AG in January of the year under review.
The item property, plant and equipment at € 11.5 million was below previous year's level (previous year: € 12.5 million). The capital expenditure amounted to € 0.7 million in the 3rd quarter of 2008 (previous year: € 0.4 million). The majority of expenses was used for replacement investments. Current assets increased by € 32.2 million during the year under review. Specifically, inventories increased by € 10.6 million compared with the prior-year, the accounts receivable rose by € 9.4 million. The increase of these items mainly results from improved Blu-ray activities. In addition, cash and cash equivalents rose by € 9.9 million compared with the prior-year. Accordingly, as of September 30, 2008 the net cash position was positive at € 8.0 million. Compared with the previous year the short-term liabilities increased by € 23.0 million. This increase mainly results in connection with higher prepayments received amounting to € 12.8 million. Furthermore, the accounts payable rose by € 6.4 million. Both effects are mainly due to a significantly improved order backlog compared with the previous year.
Compared with the previous year the long-term liabilities increased by € 25.9 million. This mainly results from an increase of the long-term bank liabilities in the amount of € 16.3 million. In addition, the long-term liabilities rose due to the firsttime consolidation of the Blu-ray activities acquired from the Oerlikon Balzers AG. In this connection the other long-term liabilities and deferred tax liabilities increased.
The shareholders' equity in the Group amounted to € 253.8 million as of September 30, 2008, below the level reported as of December 31, 2007 (€ 293.3 million). Equity in the amount of € 246.7 million is attributable to the shareholders of the parent company and € 7.1 million to minorities. The equity ratio stood at 56.0 %.
In the first nine months of the year under review the operating cash flow in the Group was slightly positive at € 0.2 million (previous year: € 23.6 million). The total cash flow amounted to € 9.9 million above the prior-year level (€ -18.0 million).
Interior Views of the IMPEDIO Wet Process System for Thin-Film Solar Cells on Foils
In the course of the first nine months of the business year 2008 there were no changes of the risks depicted in the annual report for the year 2007. An assessment of the risks within the various business divisions resulted in write-offs in the course of the restructuring amounting to € 44.7 million overall.
In our view, the selling prices developed as planned in the first nine months of the business year. Material and personnel expenses also developed according to our budgets.
The headcount in the SINGULUS Group as of September 30, 2008 amounted to 764 employees overall (previous year: 762 employees). STANGL posted a rise from 113 to 159 employees, the other parts of the Group reduced the headcount by 44 employees.
In the past couple of weeks the share price of the SINGULUS stock has also declined substantially. The stock was not able to withstand the events at the capital markets and was also heavily burdened by the financial crisis. Accordingly, the stock declined to € 2.6. In the past couple of days the share price traded at a level over € 3.
There were no changes in the Executive and Supervisory Boards during the period under review.
At € 15.6 million overall in the first nine months of 2008, the R&D expenses were below the prior-year level (previous year: € 17.6 million).
In the segment Optical Disc SINGULUS focused on the stabilization and technical acceptance of the inline mastering system CRYSTALLINE for DVD and Blu-ray in particular.
In the Solar segment the focus is set on development efforts for the assembly of the prototype for the vacuum coating machine SINGULAR for the application of anti-reflective layers in the silicon solar technology. The process-technical commissioning is scheduled for the 4th quarter 2008. STANGL works on the development and commissioning of an inline cleaning machine for silicon cells. The new machine is scheduled to be launched in the 4th quarter of 2008.
STANGL and the Helmholtz Zentrum Berlin für Materialien und Energie (HZB), formerly the Hahn-Meitner-Institut, presented the new spray ion layer gas reaction process (ILGAR) at the photovoltaics exhibition in Valencia, Spain in September.
VITRUM – Inline Wet Process System for Thin-Film Solar Cells on Glass The ILGAR process is a new method for the production of thin-film solar cells, which was developed and patented by the HZB. The ILGAR process was used for the application of indium sulfide buffer layers, which are capable of replacing cadmium sulfide in thin-film solar cells. The spray technology is reproducible, fast and cost-efficient.
Blu-ray and Solar Will Be the Drivers of Growth in the Future SINGULUS will focus on the two segments Optical Disc and Solar.
In the segment Optical Disc the global market leadership for Blu-ray production machines is in the spotlight. The order intake of Blu-ray machines in the 1st half year of 2008 exceeded our expectations significantly. SINGULUS continued to receive additional orders for their production lines in the 3rd quarter as well.
The favorable trend in the Solar segment is driven by two factors: STANGL continues to experience very strong growth in the wet-chemical segment – SINGULUS is marketing the newly-developed solar coating machine SINGULAR since September 2008 and sees growth potential for the coming years. The new plant is based on the know-how gained in the core area Optical Disc.
SINGULUS expects consolidated sales in the business year 2008 in a range from € 210 million to € 230 million. The write-offs and adjustments in the amount of € 41.2 million announced on September 17, 2008 have a considerable negative impact on the earnings figures for the full-year 2008. However, we expect a positive EBIT before restructuring charges. We expect the order intake in 2008 to exceed the level reached in the previous year and the order backlog as of the yearend to form a solid basis for the business year 2009.
The agreed portfolio optimization in connection with the clear focus on the two growth areas Blu-ray and Solar will improve sales as well as earnings and the financial figures significantly in the upcoming years.
We see the SINGULUS TECHNOLOGIES Group on a good path and optimally positioned to successfully take advantage of future opportunities.
SINGULUS TECHNOLOGIES Aktiengesellschaft
The Executive Board
| 09/30/2008 | 12/31/2007 | ||
|---|---|---|---|
| ASSETS | k€ | k€ | |
| Cash and cash equivalents | 46,825 | 36,952 | |
| Trade receivables | 77,434 | 68,016 | |
| Other receivables and assets | 18,677 | 16,288 | |
| Total receivables | 96,111 | 84,304 | |
| Raw materials, consumables and supplies | 39,974 | 34,847 | |
| Work in process | 61,383 | 55,948 | |
| Total inventories | 101,358 | 90,795 | |
| Total current assets | 244,294 | 212,051 | |
| Non-current trade receivables | 7,044 | 10,544 | |
| Non-current tax refund claims | 0 | 8,675 | |
| Property, plant and equipment | 11,463 | 12,474 | |
| Investment property | 7,150 | 8,653 | |
| Capitalized investment costs | 30,055 | 48,318 | |
| Goodwill | 66,406 | 76,814 | |
| Other intangible assets | 69,777 | 51,411 | |
| Deferred tax assets | 11,418 | 9,300 | |
| Total non-current assets | 203,313 | 226,189 | |
| Non-current assets classified as held for sale | 5,693 | 5,693 | |
| Total assets | 453,300 | 443,933 | |
| LIABILITIES Trade payables |
22,713 | 16,335 | |
| Current bank liabilities | 18,533 | 18,061 | |
| Other current liabilities | 28,334 | 22,008 | |
| Prepayments received | 22,606 | 9.772 | |
| Tax provisions | 3,091 | 4,551 | |
| Other provisions | 3,074 | 4,673 | |
| Total current liabilities | 98,352 | 75,400 | |
| Non-current bank liabilities | 20,283 | 4,018 | |
| Other non-current liabilities | 46,712 | 38,372 | |
| Pension provisions | 6,670 | 6,452 | |
| Deferred tax liabilities | 26,361 | 25,280 | |
| Total non-current liabilities | 100,026 | 74,122 | |
| Liabilities in connection with assets held for sale | 1,145 | 1,145 | |
| Total liabilities | 199,523 | 150,667 | |
| Subscribed capital | 36,946 | 36,946 | |
| Capital reserve | 48,463 | 47,503 | |
| Other reserves | -4,432 | -4,428 | |
| Accumulated profit | 165,750 | 207,197 | |
| Total equity related to the shareholders of Singulus Technologies AG | 246,727 | 287,218 | |
| Minority interests | 7,050 | 6,048 | |
| Total equity | 253,777 | 293,266 | |
| Total liabilities and equity | 453,300 | 443,933 | |
| 3rd Quarter | 9 Months | ||||
|---|---|---|---|---|---|
| 2008 | 2007 | 2008 | 2007 | ||
| k€ | k€ | k€ | k€ | ||
| Revenues (gross) | 68,582 | 57,951 | 149,900 | 170,201 | |
| Sales deductions and direct selling costs | -1,646 | -1,384 | -3,663 | -4,601 | |
| Revenues (net) | 66,936 | 56,567 | 146,237 | 165,600 | |
| Cost of sales | -45,781 | -41,286 | -105,166 | -119,788 | |
| Gross profit on sales | 21,155 | 15,281 | 41,071 | 45,812 | |
| Research and development | -4,486 | -4,285 | -13,995 | -12,178 | |
| Sales and customer service | -6,611 | -5,042 | -17,426 | -15,077 | |
| General administration | -6,543 | -4,606 | -16,615 | -14,780 | |
| Other operating expenses / income | -1,340 | -1,247 | -4,741 | -2,937 | |
| Restructuring expenses / Impairment Negative difference from the acquisition of Oerlikon Blu-ray business |
-41,206 | -44,673 15,646 |
|||
| Total operating expenses | -60,186 | -15,180 | -81,804 | -44,972 | |
| Operating income (EBIT) | -39,031 | 101 | -40,733 | 840 | |
| Interest income / Interest expense | -146 | -240 | -3,512 | 320 | |
| EBT | -39,177 | -139 | -44,245 | 1,160 | |
| Tax income / expenses | 2,860 | 426 | 4,751 | -1 | |
| Net income | -36,317 | 287 | -39,494 | 1,159 | |
| Thereof attribute to: | |||||
| Equity holders of the parent | -37,515 | -446 | -40,886 | -174 | |
| Minority interests | 1,198 | 733 | 1,392 | 1,333 | |
| Basic earnings per share (in €) | -1.02 | -0.01 | -1.11 | 0.00 | |
| Diluted earnings per share (in €) | -0.91 | -0.01 | -0.99 | 0.00 | |
| Weighted number of shares - basic | 36,946,407 | 35,008,745 | 36,946,407 | 34,964,201 | |
| Weighted number of shares - diluted | 41,246,821 | 35,573,619 | 41,246,821 | 35,484,531 |
| Income from the realization of negative goodwill (badwill) | -15,646 | |
|---|---|---|
| Depreciation on amortization | 51,682 | 15,261 |
| Change in pension accruals | 218 | 225 |
| Change in deferred tax | -6,608 | 2,080 |
| Change in net working capital* | 10,071 | 4,921 |
| Net cash flow from operating activities | 223 | 23,646 |
| Change in property, plant and equipment | -1,799 | -4,661 |
| Change in other financial assets | 3,745 | |
| Change in intangible assets | -8,296 | -14,140 |
| Payments for the acquisition of companies/parts of companies | -5,303 | |
| Change in other long-term liabilities | 8,777 | -39,939 |
| Long-term bank loans | 16,265 | -4,294 |
| Change in minority interests | -390 | -878 |
| Capital increase, capital reduction | 960 | 19,387 |
| Dividendenauszahlung | -560 | 0 |
| Currency translation | -4 | -874 |
| Net change in cash & liquid funds | 9,873 | -18,008 |
| Cash & cash equivalents at beginning of period | 36,952 | 56,216 |
| Cash & cash equivalents at end of period | 46,825 | 38,208 |
* including long-term accounts receivables
| Subscribed capital |
Capital reserve |
Other reserves |
Accumulated profit |
Minority interests |
Equity | |
|---|---|---|---|---|---|---|
| k€ | k€ | k€ | k€ | k€ | k€ | |
| Balance on January 1, 2008 | 36,946 | 47,503 | -4,428 | 207,197 | 6,048 | 293,266 |
| Minority interests | -390 | -390 | ||||
| Capital increase | 0 | |||||
| Return of capital | 0 | |||||
| Dividends paid | -560 | -560 | ||||
| Share-based payment | 960 | 960 | ||||
| Exchange related differences | -4 | -4 | ||||
| Net income | -40,887 | 1,392 | -39,495 | |||
| Balance on September 30, 2008 | 36,946 | 48,463 | -4,432 | 165,750 | 7,050 | 253,777 |
For comparison the figures of the same period the year before:
| Balance on January 1, 2007 | 34,942 | 29,879 | -2,514 | 205,538 | 6,899 | 274,744 | |
|---|---|---|---|---|---|---|---|
| Minority interests | -878 | -878 | |||||
| Capital increase | 2,004 | 2,004 | |||||
| Return of capital | 0 | ||||||
| Share-based payment | 17,150 | 17,150 | |||||
| Exchange related differences | -641 | -641 | |||||
| Net income | 1,159 | 1,159 | |||||
| Balance on September 30, 2007 | 36,946 | 47,029 | -3,155 | 206,697 | 6,021 | 293,538 | |
The SINGULUS TECHNOLOGIES Aktiengesellschaft (hereinafter also "SINGULUS" or the "Company") is an exchange-listed stock corporation headquartered in Germany. The presented consolidated financial statements for the interim reporting of the SINGULUS TECHNOLOGIES AG and its subsidiaries ("Group") for the first nine months and the 3rd quarter of the business year 2008 were approved for publication as per resolution of the Executive Board dated November 3, 2008.
The preparation of the abbreviated consolidated interim report for the period from January 1 to September 30, 2008 was made pursuant to IAS 34 "Interim Financial Reporting". The abbreviated consolidated interim report does not include all the annotations and information required for the fullyear reporting and should be read in conjunction with the consolidated financial statements as of December 31, 2007.
The preparation of the annual results pursuant to IAS 34 requires estimates and assumptions by the management, which affected the level of the reported assets, liabilities, income, expenses as well as contingent liabilities. These assumptions and estimates mainly affect the Groupconsistent determination of useful life expectancy, the write-offs of assets, the valuation of provisions, the recoverability of receivables, the determination of realizable terminal values in the area of inventories as well as the realizability of future tax relieves. The actual values can differ from the assumptions and estimates made on a case by case basis. Changes are recognized affecting earnings at the time of the knowledge gained.
The accounting and valuation methods applied for the consolidated accounts for the interim reporting correspond to those applied for the most recent consolidated financial report as of the end of the business year 2007. For a detailed description of the accounting principles please refer to the notes of the consolidated financial statements of our Annual Report 2007.
In addition to the SINGULUS TECHNOLOGIES AG, the consolidated financial statements include all companies, which are legally or factually controlled by the company.
In the interim report as of September 30, 2008, in addition to the SINGULUS TECHNOLOGIES AG in total six domestic and 15 foreign subsidiaries were included.
No company was added to the scope of consolidation after December 31, 2007.
With effect from January 31, 2008, the Blu-ray Disc machine activities from the Oerlikon Balzers AG were acquired. Please refer to the notes in the chapter Mergers.
No company has been removed from the scope of consolidation since December 31, 2007.
With effect from January 31, 2008, the Blu-ray Disc machine activities from the Oerlikon Balzers AG were acquired. The basis of the acquisition included the acquisition of know-how, accounts receivable, customer contracts, production parts and unfinished goods. For this, a purchase of € 5.3 million was paid. In addition, the patented technology was acquired as well. The purchase price for the patented technology is based on an "Earn-out" model over the next four years, which depends on the realized net sales proceeds with Blu-ray machines. As of the balance sheet date a preliminary purchase price for the technology totaled € 9.0 million. The incidental acquisition expenses directly contributable to the merger amounted € 0.2 million.
The company entered this acquisition in the balance sheet pursuant to IFRS 3. The purchase price in the amount of € 28.8 million was mainly allocated to intangible assets. Specifically, these mainly concern customer relationships (€ 23.7 million) as well as technology (€ 5.1 million). Furthermore, tangible assets in the amount of € 6.5 million were identified in the purchase price allocation. In addition, deferred tax liabilities in the amount of € 7.1 million as well as deferred tax assets in the amount of € 1.5 million resulted from the first-time consolidation. The resulting negative goodwill in the amount of € 15.6 million was recorded as income in the 1st quarter 2008 in accordance with IFRS 3 The time values attributable to the identifiable assets and liabilities of the Blu-ray Disc machines activities of the Oerlikon Balzers AG at the time of the acquisition and the respective book values immediately before the time of the acquisition were composed as follows:
| Attributable time value | Book value | |
|---|---|---|
| at time of acquisition | ||
| K€ | K€ | |
| Intangible assets | 28,780 | 0 |
| Short-term assets | 6,957 | 5,303 |
| Deferred tax assets | 1,508 | 0 |
| Total | 37,245 | 5,303 |
| Deferred tax liabilities | (7,091) | 0 |
| Total | (7,091) | 0 |
| Net assets | 30,154 | 5,303 |
| Purchase price incl. earn-out liability | 14,282 | |
| Capitalized incidental acquisition expenses | 226 | |
| Total acquisition expenses | 14,508 | |
| Bad-will | 15,646 | |
| Cash-related acquisition expenses | ||
| Acquired cash and cash equivalents | 0 | |
| Cash paid | 5,303 | |
| Actual cash outflow in 2008 | 5,303 |
The accounts receivable as of September 30, 2008 are split as follows:
| 09/30/2008 K€ |
12/31/2007 K€ |
|
|---|---|---|
| Accounts receivable | ||
| - short-term | 80,378 | 77,886 |
| Accounts receivable | ||
| - long-term | 15,874 | 10,924 |
| less write-offs | -11,783 | -10,250 |
| 84,478 | 78,560 |
Capitalized development expenses, goodwill as well as concessions, intellectual property rights and other intangible assets are included under intangible assets.
The capitalized development expenses amounted to € 30.1 million (December 31, 2007 € 48.3 million). In the first nine months of 2008 the investments in developments totaled € 8.9 million (previous year: € 6.9 million). Scheduled amortization of intangible assets amounted to € 9.7 million (previous year: € 8.6 million).
During the first nine months of the business year 2008 € 1.8 million were spent on property, plant & equipment (previous year: € 4.7 million). During the same period scheduled depreciation amounted to € 2.8 million (previous year: € 3.6 million).
Pursuant to IAS 40, SINGULUS values investment properties at acquisition and production costs. The time value as of September 30, 2008 amounted to € 7.2 million. These properties are predominantly commercially used land and buildings, which are being leased.
With effect from December 14, 2007 a syndicated credit facility in the amount of € 60.0 million was signed. The credit facility includes a loan in the amount € 25.0 million as well as a revolving credit facility in the amount of € 35.0 million with a total term to maturity of five years. The credit line is mainly used for the refinancing of the acquisition of 51 % of the shares in STANGL as well as the financing of the ongoing business activities. The interest rate of the credit commitments is adjusted to the 3-months EURIBOR on a quarterly basis. To hedge the interest risk, a corresponding hedge was concluded over the amount of the loan in February 2008. As of September 30, 2008 in total € 35.0 million of this credit line was used. As of September 30, 2008 there were overall bank liabilities in the amount of € 38.8 million (December 31, 2007 € 22.1 million) resulting from loans.
The contingent liabilities and other financial obligations not included in the consolidated accounts amount to € 10.2 million (previous year € 8.7 million) and mainly include obligations to take back machines sold (€ 2.8 million) as well as guarantees for prepayments received (€ 7.4 million). The obligations to take back machines from the sale of lines to leasing companies are set against the proceeds from the sale of the lines taken back in case this possibility is called upon. Management does not have knowledge about facts that could have a materially adverse impact on the business operations, the financial situation or the business results of the company.
| Geographic information | Germany | Rest of | North and | Asia | Africa | Australia |
|---|---|---|---|---|---|---|
| as of September 30, 2008 | Europe | South America | ||||
| K€ | K€ | K€ | K€ | K€ | K€ | |
| Sales by | ||||||
| country of origin | 111,807 | 14,738 | 7,322 | 16,033 | 0 | 0 |
| country of destination | 42,515 | 36,829 | 35,406 | 33,554 | 1,596 | 0 |
| Geographic information | Germany | Rest of | North and | Asia | Africa | Australia |
| as of September 30, 2007 | Europe | South America | ||||
| K€ | K€ | K€ | K€ | K€ | K€ | |
| Sales by | ||||||
| country of origin | 128,894 | 12,711 | 8,848 | 19,748 | 0 | 0 |
| country of destination | 20,222 | 49,038 | 52,223 | 45,435 | 2,371 | 912 |
The sales reductions include cash discounts granted. The individual selling expenses are mainly composed of expenses for packaging, freight and commissions.
In addition to the research and non-capitalized development expenses, the research and development expenses in the first nine months of 2008 include the scheduled amortization of capitalized development expenses in the amount of € 9.7 million (previous year € 8.6 million).
The administrative expenses include the expenses for the management, personnel expenses, the finance and accounting departments as well as the corresponding expenses for rent and company cars. Furthermore, they include the ongoing IT expenses, legal and consulting fees, expenses for investor relations activities, the Annual General Meeting and the annual financial statements.
The interest income / expenses are split as follows:
| 09/30/2008 | 09/30/2007 | |
|---|---|---|
| K€ | K€ | |
| Interest income from long-term | ||
| accounts receivable | 1,089 | 795 |
| Interest income from | ||
| term/sight deposits | 735 | 762 |
| Other interest income | 435 | 1,129 |
| Interest expenses | -5,771 | -2,366 |
| -3,512 | 320 |
The interest expenses include the accrued interest of the put/call option from the acquisition of STANGL in the amount of € 2.3 million.
The earnings per share were calculated based on IAS 33. The average number of shares outstanding in 2008 amounted to 36,946,407 shares (previous year 34,964,201 shares) following the issuance of 2,004,478 shares in connection with the acquisition of the STANGL AG in September 2007. The earnings after taxes based on the shareholders of the parent company amounted to € -40.9 million in the first nine months of 2008 (previous year € -0.2 million). With respect to the third quarter 2008, the earnings after taxes based on the shareholders of the parent company amounted to € -37.5 million (previous year € -0.4 million). Accordingly, the earnings per share (undiluted) for the first nine months of 2008 amounted to € -1.11 (previous year: € 0.00) and € -1.02 per share (3rd quarter 2007 € -0.01) for the 3rd quarter 2008.
The following table includes the amounts used for the calculation of the undiluted and diluted earnings:
| 09/30/2008 | 09/30/2007 | |
|---|---|---|
| T€ | T€ | |
| Net profit | -39,494 | 1,159 |
| Weighted average number of | ||
| common shares for the | ||
| calculation of the undiluted | ||
| earnings per share | 36,946,407 | 34,964,201 |
| Dilution: | ||
| Stock option program SOP tranche I | 380,000 | 380,000 |
| Stock option program SOP tranche II 472,230 | 118,058 | |
| Acquisition STANGL | 0 | 22,272 |
| Put/call option acquisition of | ||
| minority stake STANGL AG | 3,448,184 | 0 |
| Weighted average number | ||
| of common shares | ||
| adjusted for dilution | 41,246,821 | 35,484,531 |
Accordingly, the earnings per share (diluted) for the first nine months of 2008 amounted to € -0.99 (previous year: € 0.00) and € -0.91 per share (3rd quarter 2007 € -0.01) for the 3rd quarter 2008.
There were no events with material impact after completion of the quarter under review.
As of the balance sheet date, the members of the Executive and Supervisory Boards of the SINGULUS TECHNOLOGIES AG held the following number of shares, convertible bonds and stock options:
| Shares: Executive Board members Stefan A. Baustert, CEO Dr.-Ing. Anton Pawlakowitsch, CTO Hans-Jürgen Stangl |
6,500 shares 4,000 shares 825,364 shares |
|---|---|
| Supervisory Board VVG Roland Lacher KG Familie Roland Lacher Vermögensverwaltung GmbH Thomas Geitner Günter Bachmann |
594,472 shares 1,500 shares 2,000 shares |
| Stock options: Stefan A. Baustert, CEO Dr.-Ing. Anton Pawlakowitsch Convertible bonds: |
200,000 shares 80,000 shares |
| Stefan A. Baustert, CEO | 80,000 shares |
Kahl am Main, November 2008 The Executive Board
This report contains future-oriented statements based on the current expectations, assessments and forecasts of the Executive Board as well as on the currently available information to them. Known as well as unknown risks, uncertainties and impacts could cause the actual results, the financial situation or the development to differ from the statements made in this report. We assume no obligation to update the future-oriented statements made in this report.
March 27, 2009 Annual Press Conference March 27, 2009 Annual Analysts' Conference May 07, 2009 Q1/2009 Report May 29, 2009 Annual Shareholders Meeting July 31, 2009 Q2/2009 Report November 05, 2009 Q3/2009 Report
RSS Newsfeeds Press Releases
German: www.singulus.de/index.php?id=618&type=100&L=1 English: www.singulus.de/index.php?id=618&type=100&L=0
German: www.singulus.de/index.php?id=619&type=100&L=1 English: www.singulus.de/index.php?id=619&type=100&L=0
| 2006 | 2007 | 2008 | ||
|---|---|---|---|---|
| Sales | million € | 96.6 | 58.0 | 68.6 |
| Order intake | million € | 78.1 | 59.1 | 42.2 |
| EBIT | million € | 2.6 | 0.1 | -39.0 |
| Earnings before taxes | million € | 2.4 | -0.1 | -39.2 |
| Net profit | million € | 0.8 | 0.3 | -36.3 |
| 2006 | 2007 | 2008 | ||
|---|---|---|---|---|
| Sales | million € | 213.1 | 170.2 | 149.9 |
| Order intake | million € | 272.4 | 167.6 | 197.5 |
| Order backlog (September 30) | million € | 120.2 | 78.9 | 103.4 |
| EBIT | million € | 7.9 | 0.8 | -40.7 |
| Earnings before taxes | million € | 8.3 | 1.2 | -44.2 |
| Net profit | million € | 8.1 | 1.2 | -39.5 |
| Operating cash flow | million € | 11.1 | 23.6 | 0.2 |
| Shareholders' equity | million € | 271.9 | 293.5 | 253.8 |
| Balance sheet total | million € | 435.9 | 460.6 | 453.3 |
| Research & Development | million € | 19.2 | 17.6 | 15.6 |
| Employees (September 30) | 1,182 | 762 | 764 | |
| Weighted average shares | ||||
| outstanding, basic | 34,941,929 | 34,964,201 | 36,946,407 | |
| Earnings per share, basic | € | 0.23 | 0.00 | -1.11 |
SINGULUS mobile services provide you with up-to-date information about the stock and the company through mobile devices such as cell phones, Blackberrys, PDAs, Palms or smartphones.
Always latest news, up-to-date and clearly laid out: on your computer, cell phone or PDA. You will not miss important news anymore with the RSS offer from SINGULUS. With the RSS technology, web users are able to subscribe to news on web pages and to receive them on their computer. SINGULUS will alert you as soon as a new adhoc or press release is published.
A RSS feed is simply a direct channel to you. As soon as a new adhoc or press release is published you will receive a message. To be able to read the RSS newsfeed you will have to install a RSS reader. Several freeware programs are available online, which can be downloaded and installed free of charge. (Download and installation of news reader subject to you own risk. The SINGULUS TECHNOLOGIES AG does not assume any liability for the correctness of information.)
MetaCom 11/05/2008
SINGULUS TECHNOLOGIES AG
Hanauer Landstraße 103 D-63796 Kahl Phone: +49-6188-440-0 Fax: +49-6188-440-110 Mail: [email protected] Web: www.singulus.de
Building tools?
Free accounts include 100 API calls/year for testing.
Have a question? We'll get back to you promptly.