Mycronic Releases Interim Report January-March 2022

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Mycronic has announced its interim report for first quarter of 2022 (January-March).

• Order intake amounted to SEK 1,441 (1,027) million, an increase of 40 percent
• Net sales declined 12 percent to SEK 1,135 (1,291) million. Based on constant exchange rates, net sales decreased 19 percent
• EBIT amounted to SEK 206 (498) million and EBIT margin was 18 (39) percent
• Earnings per share were SEK 1.69 (3.99)

“We had a strong start to the year, with an increase in order intake of 40 percent, where all divisions contributed to the development. Net sales decreased 12 percent during the quarter, which was attributable to lower net sales in Pattern Generators. We previously stated that this changed sales mix in the Group, with a decline in Pattern Generators’ share of total net sales, will characterize the year. During the first quarter, this meant that EBIT declined to SEK 206 million, with an EBIT margin of 18 percent. In February, we finalized the divestment of AEi, which resulted in a capital gain and had a positive impact on EBIT of SEK 25 million. The Group’s direct exposure to the war in Ukraine is limited. We have no personnel in Russia, Belarus or Ukraine and only marginal sales to these countries. Similarly, we currently do not believe that a potential shortage of inert gases from Ukraine will have a direct impact on Pattern Generators,” says Anders Lindqvist, President and CEO. 

Outlook 2022

It remains the Board of Directors’ opinion that consolidated net sales for 2022 will be at a level of SEK 5 billion, based on exchange rates at the end of 2021. Due to the product mix of announced orders in Pattern Generators with deliveries in 2022, the Group’s EBIT margin is expected to be slightly above the long-term financial goal of >15 percent.

Comment from Anders Lindqvist, President and CEO

We had a strong start to the year, with an increase in order intake of 40 percent, where all divisions contributed to the development. Net sales decreased 12 percent during the quarter, which was attributable to lower net sales in Pattern Generators. We previously stated that this changed sales mix in the Group, with a decline in Pattern Generators’ share of total net sales, will characterize the year. During the first quarter, this meant that EBIT declined to SEK 206 million, with an EBIT margin of 18 percent. In February, we finalized the divestment of AEi, which resulted in a capital gain and had a positive impact on EBIT of SEK 25 million. The Group’s direct exposure to the war in Ukraine is limited. We have no personnel in Russia, Belarus or Ukraine and only marginal sales to these countries. Similarly, we currently do not believe that a potential shortage of inert gases from Ukraine will have a direct impact on Pattern Generators.

A continued healthy level of activity was noted for the photomask market for semiconductors. Since the launch in 2019, Pattern Generators has delivered ten SLX systems, which have been well received by customers. The SLX comes with an energy efficient solid state laser which significantly lowers the environmental impact compared with the majority of the installed base. There were also signs of a positive development in the photomask market for displays. During the quarter, Pattern Generators received orders for three SLX semiconductor mask writers and one Prexision Lite 8 Evo display mask writer. At the same time, the division delivered two SLXs during the quarter, compared with one Prexision 800 Evo, one Prexision Lite 8 Evo, and one SLX during the corresponding period of the preceding year.

During the first quarter of the year, the market for High Flex remained strong and the division’s customers have well-filled order books. Positive market momentum within jet printing and pick-and-place solutions contributed to a good order intake during the quarter.

The electronics industry in China had a stable development during the first quarter, despite uncertainty related to Covid-19. High Volume has engaged in close dialogue on future projects with existing customers in the automotive and consumer electronics industries. In mid-March, the authorities imposed a week’s lockdown in Shenzhen, China, where High Volume has its base. The impact on the division was limited.

Regarding Global Technologies, the market for tele and data communications in die bonding continued its strong performance, mainly driven by investments in data centers. At the same time, the aerospace and defense industry showed signs of good growth going forward. The market for electrical testing demonstrated continued strength, driven by a robust demand for PCBs and substrates and with a strong recovery in Europe.

Despite a continued shortage of production personnel, component supplies related to the pandemic, and challenges regarding distribution logistics, we mostly succeeded in delivering production equipment to our customers according to plan during the quarter.

We have a strong position for continued sustainable and profitable growth and a clear growth strategy characterized by a combination of organic and acquisition-driven growth. We are seeking actively within attractive areas to complement and broaden our offering through carefully selected acquisitions.

For 2022, it remains my assessment and that of the Board of Directors that Mycronic’s net sales will be at a level of SEK 5 billion based on exchange rates at the end of 2021.