Strong order intake for Aixtron
Order intake and revenues in first nine months at the highest level since 2012
Aixtron continues to report strong order intake in the third quarter of 2021. The equipment of the leading supplier of deposition equipment to the semiconductor industry was in particular demanded for GaN and silicon carbide power electronics applications, wireless and optical data communications as well as for LED applications. Order intake and revenues in the first nine months of the reporting year 2021 reached their highest level since 2012.
Order intake increased by 80 percent compared to the corresponding period of the previous year to €377.6 million. In the third quarter, order momentum remained at the high level of the previous quarters, reaching €114.2 million, compared to €139.0 million in the second quarter of 2021 and €124.4 million in the first quarter of the reporting year. The order backlog at the end of the third quarter of 2021 stood at €267.7 million, compared to €295.0 million at the end of the second quarter. Year-on-year, the order backlog exceeded the corresponding prior-year figure by 63 percent.
High revenue momentum
Due to the high number of systems delivered, the equipment manufacturer almost doubled its revenues in the third quarter by 93 percent to €130.8 million. From January to September inclusive, revenues increased by 54 percent year-on-year to €248.1 million. The revenue development was driven by a variety of applications, including equipment for the manufacture of GaN power electronics and wireless and optical data transmission devices as well as of red LEDs.
In the first three quarters of the reporting year, the semiconductor equipment manufacturer generated gross profit totaling €101.4 million, exceeding the corresponding prior-year figure by 60 percent. The company thus generated a gross margin of 41 percent (previous year: 39 percent). In the third quarter, gross profit of €56.3 million almost doubled compared to the previous quarter (€27.9 million) with a further improvement in the margin from 41 percent to 43 percent.
At €20.1 million, operating expenses in the third quarter of 2021 were slightly below the level of the previous quarter (€22.3 million). This reflects the structural adjustments and cost reductions at the OLED subsidiary APEVA in the second quarter of 2021, with a simultaneous slight increase in expenses for the development of the next generation of MOCVD systems. Overall, R&D expenses fell from €41.2 million to €40.5 million in the first nine months compared to the same period of the previous year.
As a result of the significant increase in gross profit combined with lower operating expenses, Aixtron's operating result (EBIT, earnings before interest and taxes) nearly quadrupled in the first nine months, from €10.3 million to €41.1 million. In the third quarter, the operating result amounted to €36.2 million, compared to €5.6 million in the previous quarter. Accordingly, the EBIT margin increased significantly in the first three quarters to 17 percent (previous year: 6 percent) and in the third quarter to 28 percent (previous year: 8 percent).
At €31.4 million, the deposition equipment manufacturer's net result for the third quarter of 2021 significantly exceeded the previous quarter's figure of €7.7 million. In the first nine months of the reporting year, Aixtron generated net income of €42.9 million, compared to €9.6 million in the corresponding period of the previous year.
High financial strength
Aixtron has a solid financial foundation with an equity ratio of 78 percent (as of September 30, 2021), up from 84 percent as of December 31, 2021. Primarily due to the increase in inventories for planned deliveries in the fourth quarter of 2021 and investments in next-generation laboratory equipment, the free cash flow in the third quarter was €-19.0 million (previous quarter: €18.0 million).
Aixtron confirms 2021 guidance
The Aixtron executive board confirms the most recent guidance for the year. For fiscal year 2021, it expects
- Order intake in a range between €440 million and €480 million
- Revenues between €400 million and €440 million
- a Gross margin of around 40 percent of revenues and an EBIT margin of between 20 percent and 22 percent of revenue.
The expectations for 2021 are based on the assumption that the COVID-19 pandemic continues to have no significant impact on the development of business operations.
With a view to the sustainability goals newly defined for the Aixtron Group in 2020, the Management Board is also aiming for a noticeable reduction in energy consumption and a significant expansion of further training measures for employees in the medium term.
"Megatrends such as digitalization and data communication, energy efficiency and e-mobility are driving demand for compound semiconductors. Their outstanding properties are the basis for applications not only in optoelectronics, but increasingly also in power electronics. Our deposition equipment enables our customers to achieve exactly the performance and productivity they require. As a result, we expect revenues in the current fourth quarter of 2021 to increase even further compared to the already strong previous quarters," said Felix Grawert, CEO and president of Aixtron SE.