Aixtron upgrades 2022 growth guidance
Company reports strong demand with G10-SiC system accounting for largest share of orders in the quarter
Deposition firm Aixtron SE has reported a significant year-over-year increase in order intake in the third quarter of 2022. The strong demand for systems for the production of efficient power electronics based on GaN and SiC, as well as from the areas of lasers and micro LEDs, ensure a continued strong order situation.
In the first nine months of 2022, revenues increased by 13 percent year-on-year to €279.9 million. Operating result (EBIT) improved by 16 percent year-on-year to €47.6 million, with an EBIT margin of 17 percent.
Due to the good business development in the first nine months and in view of the continued very positive assessment of the development of demand and product mix, the Executive Board is upgrading the growth guidance for fiscal year 2022.
Overall, the current global crisis situations and market developments continue to have only a minor impact on our business. Logistics and supply chains are tense, but in our view remain stable overall.
Strong order intake
Order intake in the first nine months of 2022 increased by around 13 percent year-on-year to €425.6 million (9M/2021: €377.6 million). This reflects the continued high demand across almost all end markets. In the third quarter, order intake of €142.8 million significantly exceeded the level of the prior-year quarter (Q3/2021: €114.2 million) and the recently launched G10-SiC system has already accounted for the largest share of total orders in the quarter. The development of order intake reflects the consistently high demand for efficient power electronics based on GaN and SiC as well as for micro LEDs.
As of September 30, 2022, the equipment order backlog amounted to €369.4 million compared to €267.6 million as of the previous year's reporting date and €314.4 million as of June 30, 2022.
Power electronics on the rise
Revenues of the MOCVD world market leader improved by 13 percent year-on-year to €279.9 million in the first nine months of 2022 (9M/2021: €248.1 million). Revenues in the third quarter of 2022 were €88.9 million (Q3/2021: €130.8 million; Q2/2022: €102.5 million).
The difference compared to the same quarter of the previous year is mainly due to a few customer-related delivery delays and the granting of export licenses, which were not yet available as of the reporting date. Due to unabated strong demand and stable supply chains, the Executive Board expects exceptionally high shipments in the fourth quarter of 2022 and thus a significant increase in revenues.
In the third quarter of 2022, deliveries of equipment for the manufacture of GaN and SiC power electronics accounted for the largest contribution to revenues with a share of more than 50 percent. Sales of systems for the manufacture of lasers, in particular for optical data transmission and 3D sensor technology, were strong as well.
Gross margin increased in the third quarter due to improved product mix
Compared to the previous year, gross profit in the first nine months of 2022 increased by 12 percent to €113.1 million with a gross margin of 40 percent (9M/2021: €101.4 million; 41 percent). Gross profit in Q3/2022 was €39.3 million with a gross margin of 44 percent, (Q3/2021: €56.3 million; 43 percent). The increase in gross margin mainly results from the changes in the product mix.
Operating expenses of €65.4 million increased slightly in the nine-month period (9M/2021: €60.3 million). Higher variable compensation components and lower R&D grants contributed to this increase. In the third quarter 2022, operating expenses increased year-on-year to €23.1 million (Q3/2021: €20.1 million).
Operating profit (EBIT) improved to €47.6 million in the first nine months compared to €41.1 million in the same period of the previous year, with an EBIT margin of 17 percent (9M/2021: 17 percent). The increase was mainly due to higher revenues and the related gross margin as well as the business and cost development described above. In the third quarter, EBIT amounted to €16.2 million (Q3/2021: €36.2 million) with an EBIT margin of 18 percent (Q3/2021: 28 percent).
The Aixtron Group's net profit increased in 9M/2022 to €50.2 million (9M/2021: €42.9 million). In the third quarter 2022, it amounted to €19.1 million (Q3/2021: €31.4 million). Earnings per share increased accordingly to €0.45 in the first nine months 2022 and €0.17 in the third quarter (9M/2021: €0.39; Q3/2021: €0.28).
Free cash flow amounted to €19.0 million in the first nine months of 2022 (9M/2021: €27.1 million).
2022 growth guidance upgraded
Due to the good business development in the first nine months and in view of the continued very positive assessment of the development of demand and product mix, the Executive Board is upgrading the growth guidance for fiscal year 2022.
For the full year, it now expects order intake in a range between €540 million and €600 million (previously: between €520 million and €580 million). With revenues in an unchanged range between €450 million and €500 million, the Executive Board now expects to achieve a higher gross margin of approximately 42 percent (previously: approximately 41 percent) and an EBIT margin of now approximately 22 percent to 24 percent (previously: approximately 21 percent to 23 percent).
As before, the expectations for 2022 are subject to the provision that the current challenging environment or special market developments continue to have no significant impact on the development of the business.
"We are very pleased with the success of our recently launched G10-SiC and expect similar success for the upcoming launches of our new system generations," says Felix Grawert, CEO and President of Aixtron SE. "The increasing share of fully automated systems also shows the strong demand for new technologies, which confirms us in our chosen path."
"The increase of our 2022 guidance in this challenging environment is the result of rising demand for our pioneering technologies," commented Christian Danninger, CFO of Aixtron SE. "Our strategic initiatives regarding product development and supply chain management are taking effect."
