Aspocomp Releases 2016 Financial Results; Expects 10% Sales Growth in 2017

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Aspocomp Group Plc, Financial Statements

Key figures 10-12/2016 in brief

• Net sales: EUR 6.6 million (EUR 4.8 million 10-12/2015)
• EBITDA: EUR 1.1 million (-0.1)
• Operating result: EUR 0.8 million (-0.3)
• Earnings per share: EUR 0.19 (-0.01)

Key figures 2016 in brief

• Net sales: EUR 21.6 million (EUR 17.5 million 1-12/2015)
• EBITDA: EUR 1.8 million (0.0)
• Comparable operating result: EUR 0.7 million (-0.9)
• Operating result: EUR 0.7 million (-1.2)
• Earnings per share (EPS): EUR 0.16 (-0.16)
• Operational cash flow: EUR 0.1 million (-0.1)
• Order book at the end of period: EUR 2.4 million (0.7)

In 2017, net sales are expected to grow approximately 10 percent and the operating result to be better than in 2016. In 2016, net sales amounted to EUR 21.6 million and the operating result was 3 percent of net sales.

CEO’S Review

“Our main strategic objective for 2016 – ‘Accelerate growth’ – was well achieved on the whole. The market situation was weak at the beginning of the year, but sales began growing in line with expectations during the second quarter and remained strong throughout the year.

Sales developed well as from the second quarter and peaked in the fourth quarter, amounting to EUR 6.6 million (EUR 4.8 million 10-12/2015), a year-on-year increase of 39 percent. Full-year net sales amounted to EUR 21.6 million (EUR 17.5 million/2015), representing very strong annual growth of 24 percent.

The development of the new generation of computer network systems generated demand for PCBs, which picked up significantly towards the end of the year and was the main driver of growth in the fourth quarter. The needs of automotive industry customers remained firm throughout the year and the entire customer segment doubled its sales compared to the previous year.

Profitability improved clearly during the fourth quarter as deliveries focused on more technologically demanding products. The operating result for the fourth quarter amounted to EUR 0.8 million, over 12 percent of net sales. Full-year operating result rose into the black and amounted to EUR 0.7 million, or over 3 percent of net sales. Working capital increased by EUR 1.6 million due to business growth. In spite of this, the cash flow was positive at EUR 0.1 million.

The printed circuit board market is estimated to grow by 2 percent in 2017 (source: Custer Consulting Group). Aspocomp expects net sales growth to continue outpacing the market and reach a level of about 10 percent in 2017. Profitability is expected to improve from 2016, mainly due to the growing net sales and more balanced demand.

Aspocomp will present a more detailed review of its goals and strategy at its Capital Markets Day on Tuesday, March 14, 2017.”

Net Sales and Earnings

October-December 2016

Fourth-quarter net sales amounted to EUR 6.6 million, a year-on-year increase of 39 percent. PCB demand generated by the development of the new generation of computer network systems picked up significantly towards the end of the year and was the main driver of growth in the fourth quarter.

The five largest customers accounted for 62 percent of net sales (49% 10-12/2015). In geographical terms, 97 percent of net sales were generated in Europe (93%), 3 percent in Asia (3%) and 1 percent in North America (4%).

The operating result for the fourth quarter amounted to EUR 0.8 million (EUR -0.3 million 10-12/2015). Fourth-quarter comparable operating result was 12 percent of the net sales. In the fourth quarter, deliveries focused mainly on higher value-added products, improving profitability significantly.

Net financial expenses for the fourth quarter amounted to EUR 0.0 million (EUR 0.0 million 10-12/2015). Earnings per share were EUR 0.19 (EUR -0.01).

Financial year 2016

Net sales amounted to EUR 21.6 million, a year-on-year increase of 24 percent. The needs of automotive industry customers remained firm throughout the year and the entire customer segment doubled its sales compared to the previous year.

The five largest customers accounted for 53 percent of net sales (47% 1-12/2015). In geographical terms, 93 percent of net sales were generated in Europe (93%), 5 percent in Asia (5%) and 2 percent in North America (2%).

Operating result amounted to EUR 0.7 million (EUR -1.2 million 1-12/2015). The comparable operating result was EUR 0.7 million (EUR -0.9 million 1-12/2015, excluding the Teuva plant's shutdown costs). Profitability improved in the second half of the year as revenue grew and deliveries focused on higher value-added products.

Net financial expenses amounted to EUR 0.1 million (EUR 0.1 million). Earnings per share were EUR 0.16 (EUR -0.16).

Outlook for The Future

A major share of Aspocomp’s net sales is generated by quick-turn deliveries and R&D series, and thus the company’s order book is short. The company's aim is to systematically expand its services to cover the PCB needs of customers over the entire life cycle and thereby balance out variations in demand and the order book.

In 2017, net sales are expected to grow approximately 10 percent and the operating result to be better than in 2016. In 2016, net sales amounted to EUR 21.6 million and the operating result was 3 percent of net sales.

Board of Directors' Dividend Proposal and Annual General Meeting

The Board of Directors will propose to the Annual General Meeting to be held on March 23, 2017, that no dividend be paid for the financial year January 1, 2016 - December 31, 2016 and that the loss of the parent company, EUR 661,980.67 be transferred to the company's retained earnings account. The parent company's distributable funds totaled approximately EUR 7.7 million.

About Aspocomp

Aspocomp specializes in demanding PCB technologies, serving its customers throughout the entire life cycle of a product. Aspocomp sells and manufactures PCBs and also provides related design and logistics services as well as technology solutions. Aspocomp creates value for its customers with unique products and solutions, strong manufacturing and technology expertise, as well as fast and reliable deliveries. A wide network of expert partners together with Aspocomp's own manufacturing enables its customers to cost-effectively buy their PCBs from a single provider over the entire life cycle of a product.

A printed circuit board (PCB) is the principal interconnection method in electronic devices. PCBs are used for electrical interconnection and as a component assembly platform in most electronic applications. Aspocomp's customers are companies that design and manufacture telecom systems and equipment, automotive and industrial electronics, security technology and semiconductor testing systems.