Aspocomp’s Q1 Net Sales Down in a Challenging Market

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Aspocomp releases its interim report for January 1 – March 31, 2021. The company's net sales declined in the challenging market and the operating result remained at the previous year’s level.

Demand is expected to improve in all customer segments. However, a global shortage of components may hinder positive developments.

The company’s full-year guidance remains unchanged. Aspocomp estimates that its net sales for 2021 will increase and its operating result for 2021 will improve from 2020. In 2020, net sales amounted to EUR 25.6 million and the operating result to EUR -0.1 million. 

CEO’S Review

“Demand for PCBs was weak as expected in the first quarter, which is typically the quietest quarter of the year. The net sales for January-March amounted to EUR 6.2 million, a year-on-year decrease of about 7 percent. The decline in net sales was steady in almost all customer segments, with only the Industrial Electronics segment swinging to growth of 22 percent. Customer prospects and purchases clearly picked up towards the end of the quarter, as companies began to prepare for growth in demand when COVID-19 pandemic restrictions will be eased. The growth expectations of the electronics industry are also reflected in the difficult availability of raw materials and semiconductor components and the significant increase in delivery times.

The operating result was EUR 0.5 million in the red, a year-on-year decrease of 16 percent. The weak operating result was affected by the low level of net sales at the beginning of the year, an unfavorable product mix and increased maintenance costs at the Oulu plant due to equipment breakdowns and preventive maintenance. Our earnings performance will recover in step with rising demand and the positive development of the order book.”

Impact of the COVID-19 pandemic

Due to the COVID-19 pandemic and the resulting decline in general demand, as well as for financial reasons, some customers have had to postpone or even cancel their orders. Asian PCB mass suppliers have had overcapacity due to the weaker market situation, which allowed them to exceptionally respond to changing customer needs.

The company’s production at the Oulu plant has continued normally and delivery capacity has been reasonable. The company has continued to invest in new capacity and increased its product development investments in new products and more challenging technologies. 

The pandemic has not affected the company’s liquidity. The cash situation has remained good and the credit facilities have not been used. The company has had no need to recognize write-downs of goodwill. 

Net Sales and Earnings

January - March 2021

First-quarter net sales amounted to EUR 6.2 (6.7) million, a year-on-year decrease of 7 percent. Net sales declined steadily in almost all customer segments, except for Industrial Electronics, which grew by 22 percent. 

The five largest customers accounted for 48 (42) percent of net sales. In geographical terms, 87 (90) percent of net sales were generated in Europe and 13 (10) percent on other continents. 

The operating result for the first quarter amounted to EUR -0.5 (-0.4) million. First-quarter operating result was -8.0 (-6.3) percent of net sales. The operating result was burdened at the beginning of the year by the low net sales level and unfavorable product mix and as well as increased maintenance costs at the Oulu plant.

Net financial expenses amounted to EUR 0.0 (0.0) million, including a deferred exchange gain of EUR 0.1 million. Earnings per share were EUR -0.07 (-0.07). 

The order book at the end of the review period was EUR 5.3 (5.6) million.