Süss MicroTec AG: Preliminary Figures for the 3rd Quarter of 2008
Süss MicroTec AG / Profit Warning
Release of an Ad hoc announcement according to § 15 WpHG, transmitted by
DGAP - a company of EquityStory AG.
The issuer is solely responsible for the content of this announcement.
SUSS MicroTec AG: Preliminary Figures for the 3rd Quarter of 2008
- Extraordinary Expenses of EUR 18.3 Million Lead to Lowering of Annual
- Positive EBIT of EUR 1.8 Million (before Extraordinary Expenses) after
First Nine Months of 2008
- 2008 Sales Target between EUR 142–145 Million
Munich, Germany, October 22, 2008. Based on preliminary figures from the
first nine months of 2008, SUSS MicroTec (business address: Schleissheimer
Straße 90, 85748 Garching, Germany; ISIN: DE0007226706), listed in the
Prime Standard of Deutsche Börse AG, has shown strong sales and order entry
figures, asserting itself against the negative industry trend. However,
both nine months result as well as annual result expectations were affected
by extraordinary expenses totaling EUR 18.3 million, particularly related
to write-downs to intangible assets.
After nine months, sales of EUR 104.3 million exceeded the previous year’s
value of EUR 98.7 million by approximately 5%. Sales of EUR 34.6 million in
the third quarter were even approximately 55% over the previous year’s
total of EUR 22.3 million. SUSS MicroTec was therefore able to develop
better than the market, but the Company also profited from the high order
backlog from previous quarters. Despite the troubled industry and economic
environment, operating growth is sound. After nine months, the preliminary
operating result (EBIT) – without the extraordinary expenses – amounted to
EUR 1.8 million. However, including the extraordinary expenses, it came to
EUR -16.5 million.
The reason for the loss was extraordinary expenses totaling EUR 18.3
million, of which only EUR 0.7 million affected cash flow. These primarily
- Write-downs on capitalized development costs for C4NP amounting to EUR
- Amortization of the goodwill of the subsidiary Image Technology Inc.
calculated at EUR 4.4 million
- Depreciation on inventories coming to EUR 2.7 million
- Restructuring costs consisting of EUR 0.8 million
- Value adjustment on a customer-specific project equaling EUR 1.9
- Others comprising EUR 0.5 million
Due to external and internal factors, Management Board and Supervisory
Board were convinced that the business prospects for the internally
developed C4NP technology and the subsidiary Image Technology Inc. should
be reassessed. Although the Management Board still believes in the C4NP
technology, aside from the initial installation at IBM, it will most likely
not be possible to acquire any additional customers this year. With this in
mind, a performed impairment test resulted in the writing-down of EUR 8
million in capitalized development costs, in addition to the planned
write-down of EUR 0.4 million.
The valuation of the US subsidiary Image Technology Inc. also needed to be
adjusted based on a changed sales and earnings situation. The reason for
the considerably slower development is problems experienced with a key
customer. These issues have negatively affected the entire business outlook
and are on top of the already difficult market conditions in the mask
industry. With the cost reduction measures already implemented at the
subsidiary, the Management Board believes that the foundation for a
successful future development – even at a strongly reduced sales level –
has been laid. Based on this, a corresponding correction of EUR 4.4 million
to the balance sheet value of the goodwill was necessary.
In consideration of the economic downturn, the Management Board has begun
implementing comprehensive cost reduction and restructuring measures.
Within the framework of the partially initiated restructuring measures in
the last weeks, the number of employees has been reduced from 732 (June 30,
2008) to 705 as of September 30, 2008, and will be further reduced to
approximately 690 by the end of the year.
The acute cost reduction measures will also be introduced due to a
potential reduction in spending within the semiconductor industry. After
three successive strong quarters, the SUSS MicroTec Group recorded an
expected lower level of new orders of EUR 24.7 million (Q3 2007: EUR 31.3
million). After the first nine months of 2008, the order entry of SUSS
MicroTec AG totaled EUR 111.1 million, up from EUR 95.5 million recorded
during the same period in the previous year. The order backlog as of
September 30, 2008 climbed to EUR 85.7 million, a 19% increase over the
same period in the previous year (September 30, 2007: EUR 72 million).
As of September 30, 2008, SUSS MicroTec Group possesses liquid assets of
EUR 15.3 million. The net cash position was EUR 1.5 million as of September
30, 2008. Due to an increase in working capital – in order to address the
higher order backlog – the operating cash flow was slightly negative in the
first nine months of 2008. A positive free cash flow is expected for the
fourth quarter of 2008.
Up until now, the SUSS MicroTec Group could rely on an extension of its
long-standing domestic credit line. The credit line, which had been granted
by a consortium of three banks, expired on September 30, 2008. It had been
primarily used as security for down payment guarantees and has not yet been
renewed by the bank consortium. The Management will continue discussions in
order to secure a similar credit line and, in particular, to
comprehensively use the liquidity of prepayments received. The Company’s
current liquidity position is definitely sufficient to entirely cover all
of its operational needs.
In the fourth quarter, the Company expects improved sales figures in
comparison to the previous quarter. The basis for this is formed by the
good order backlog of EUR 85.7 million. For 2008, SUSS MicroTec is
calculating sales to reach between EUR 142–145 million by the end of the
year with a positive EBIT (before extraordinary expenses) of between EUR
5–6 million. Taking the extraordinary expenses into account, EBIT is
expected to be between EUR -12.3 and -13.3 million.
End of the ad hoc disclosure
SÜSS MicroTec AG
Tel.: +49 (0)89 32007-161,
22.10.2008 Financial News transmitted by DGAP
Issuer: Süss MicroTec AG
Schleissheimer Strasse 90
85748 Garching b. München
Phone: +49 (0)89 32007-161
Fax: +49 (0)89 32007-336
Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr
in Berlin, Düsseldorf, Hamburg, München, Stuttgart
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