Kitron Posts Record Revenue and Profitability for Q2 2023

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Kitron reported record revenue and profitability for the second quarter, lifted the outlook for the full year and announced capacity expansions.

Kitron’s revenue for the second quarter was EUR 206.3 million, compared to 157.3 million last year. Growth was particularly strong within the Electrification market sector.

Second-quarter operating profit (EBIT) was EUR 19.2 million, compared to 9.9 million last year. EBITDA was EUR 23.5 million, compared to 14.2 million last year.

The order backlog ended at EUR 535 million, an increase of 13 per cent compared to last year, reflecting continued strong demand. The highest growth was in the market sectors Electrification and Defence & Aerospace. However, the order backlog is lower than in the preceding quarter as the gradually improving electronic component situation has reduced lead times.

Peter Nilsson, Kitron’s CEO, comments:

“Our second quarter 2023 performance is once again record-breaking, demonstrating our adaptability in a challenging economic landscape. We also see new business opportunities, for instance driven by the electrification megatrend and by a growing trend of capacity diversification outside of China. We are now investing in new facilities in the Czech Republic and Malaysia to seize these opportunities.”

Profitability expressed as EBIT margin was 9.3 per cent in the second quarter, compared to 6.3 per cent in the same quarter last year.

Profit after tax amounted to EUR 15.7 million, compared to 6.6 million in the same quarter the previous year. This corresponds to earnings per share of EUR 0.08, up from 0.03 last year.

Improved capital efficiency

Operating cash flow in the second quarter was EUR 9.0 million, compared to 4.0 million in the second quarter of 2022.

Net working capital was EUR 189 million, an increase of 9 per cent compared to the same quarter last year. Net working capital as a percentage of revenue was 22.3 per cent compared to 27.8 per cent last year. Capital efficiency ratios have improved, and this trend is expected to continue.

New facilities in the Czech Republic and Malaysia

Due to increased demand, Kitron will add production capacity towards the end of 2023 in the Czech Republic and Malaysia. The Czech facility will support increased volumes within the Electrification market sector. The Malaysian facility will diversify our Asian offering outside China. 

Outlook

For 2023, Kitron has previously indicated a revenue outlook of between EUR 700 and 800 million and an operating profit (EBIT) between EUR 60 and 75 million. Entering the second half of 2023, demand continues to be strong, and capital efficiency ratios are improving. We now expect revenues between 750 and 800 EUR million with an operating profit (EBIT) between 65 and EUR 75 million.