Aixtron: Guidance for 2016 confirmed despite slow start
Deposition equipment company Aixtron has announced financial results for the first quarter 2016.
Compared to the previous quarter, total order intake in Q1/2016 improved by 42 percent to €44.4m (Q1/2015: €48.9m; Q4/2015: €31.3m) which is mainly attributable to stronger demand for Aixtron's planetary reactor technology across a variety of applications.
Equipment order backlog in the first quarter 2016 increased significantly by 58 percent to €67.7m (December 31, 2015: €42.9m). This development supports the revenue growth expectation for the remainder of 2016. Consequently, management reiterates the full year 2016 guidance given in February 2016 despite a slow start to the year.
In line with the low order backlog as of December 31, 2015, Q1/2016 total revenues decreased to €21.4m (Q1/2015: €40.3m; Q4/2015: €62.5m).
"Based on the order backlog as of December 31, 2015, Q1/2016 developed on a modest scale. As a result it has been more important than ever to increase productivity as well as to control costs", says Martin Goetzeler, president and CEO of Aixtron SE.
"The significant increase in our order intake in the first three months of 2016 demonstrates that we were able to convince our customers with our system technologies for the production of future-oriented materials such as GaN-on-silicon, SiC or graphene in particular.
"In the area of opto and power electronics, we have performed well with our planetary systems, especially with our AIX G5+ C cluster tool and our revised AIX G4-TM system. Furthermore, we put great emphasis on cooperation projects with leading research institutions such as imec and Institut Lafayette. Thus, we support our goal to achieve a diversified technology and product portfolio."
Business Development
There were positive developments in semiconductors for optoelectronics and power electronics businesses, according to the company, caused by growing demand for high-performance and energy-efficient components for use in markets such as communications, data storage and electric mobility.
In addition, Aixtron saw increased demand for production systems for red-orange-yellow (ROY) LEDs in Q1/2016. Demand for tools in the silicon area was slow but the company anticipates a recovery in the coming quarters.
One of the reason for the weak revenues was in particular the weak demand for production systems for GaN-based LED applications and the related low order intake in Q3/2015 and Q4/2015, says Aixtron.
The year-on-year as well as the sequential decrease of cost of sales in Q1/2016, mainly attributable to the low revenue level, was partially offset by costs of capacity under-utilisation and negative currency valuation impacts. Year-on-year, cost of sales were down by 42 percent and compared to the previous quarter they were down 57 percent (Q1/2015: €31.5m; Q4/2015: €42.8m).
Against the background of low revenues and despite a favorable product mix, Q1/2016 gross profit was low at €3.1m representing a gross margin of 15 percent compared to 31 percent gross margin in Q4 2015.
Operating expenses in Q1/2016 were largely stable at €17.8m versus €17.6m in Q1/2015.
Guidance
Based on the assessment on Aixtron's current order situation, its management expects fiscal year 2016 to achieve revenues between €170 million and € 200 million with a significantly stronger revenue generation in the second half of 2016 compared to the first half of 2016. Currency adjusted, order intake (in Euros) is expected to be at the same level as in fiscal year 2015.
