Micronas increases sales and earnings in third quarter (PR0815)
Zurich, October 14, 2008 - In the third quarter of 2008, the Micronas Group recorded an improvement in sales and earnings compared with the previous quarter. Consolidated net sales for the period came to CHF 158.1 million, an increase of 7.1 percent on the second quarter. Operating profit before depreciation and amortization (EBITDA) for the quarter rose to CHF 20.4 million. Operating profit before exceptional items was CHF 1.5 million, compared with an operating loss of CHF 10.1 million the previous quarter. Operating profit (EBIT) was CHF 5.0 million. The profit for the period amounted to CHF 5.8 million in the third quarter, with earnings per share of CHF 0.20. Micronas reports net cash of CHF 291.3 million as at the end of September 2008. For the 2008 business year as a whole, Micronas expects sales of CHF 600 to 615 million and an operating loss of around CHF 25 million.
Despite the marked turbulence affecting the automotive market, the Automotive division generated sales of CHF 52.4 million, around the same level as the previous quarter. However, operating profit decreased from CHF 11.4 million to CHF 9.7 million due to expenditure on investments in product development, marketing and sales. The resulting EBIT margin for the third quarter was 18.6 percent.
As a result of a change in consumer behavior, all vehicle manufacturers have substantially reduced their sales projections for 2008 and 2009. This has already had an adverse effect on incoming orders at Micronas. However, the impact of declining automobile production on our business will be disproportionately lower, because the increasingly popular fuel-optimized vehicles, such as hybrids, use more Micronas sensors than conventional vehicles.
Micronas has further extended its product offering to meet these changing market requirements. Production of the second generation of programmable, linear Hall sensors with improved specifications started up in the third quarter. This is a Hall sensor with burn-in – pretreatment for detection of early faults – which offers improved quality and a very attractive price-performance ratio thanks to mass production.
Restructuring of the Consumer division continued according to plan in the third quarter. Sales were up on the previous quarter by 11.7 percent, reaching CHF 105.7 million. The operating loss (EBIT) came down by 78.0 percent to CHF 4.7 million.
The TV market remained largely stable in the third quarter. Market share was gained by manufacturers with their own panel technology and a strong brand. At this year’s IFA consumer electronics trade show, Micronas showed its strong commitment to the TV sector with a number of product announcements which demonstrated how its developments are geared to the requirements of manufacturers. Micronas offers the VCT Premium processor, a highly integrated component for sets with LCD or plasma screens, which provides full signal processing for video and audio. LCD sets from Sony and JVC equipped with this processor performed outstandingly in comparative tests.
It is not yet possible to assess the extent to which the present economic climate and the uncertainties
surrounding developments in our most important markets will affect our business. For the 2008 business year as a whole, Micronas expects sales of CHF 600 to 615 million and an operating loss of around CHF 25 million. The Consumer division will contribute sales of between CHF 395 and 405 million; the Automotive division will generate sales of CHF 205 to 210 million. At EBIT level, the Consumer division is expected to make an operating loss of around CHF 65 million, while Automotive should achieve an operating profit of around CHF 40 million.
The Micronas Group is a leading independent supplier of innovative application-specific semiconductor solutions for consumer and automotive electronics. Its shares are listed on the SWX Swiss Exchange in Zurich.
Zurich, October 14, 2008