Q3 Sales Growth of 7%, EBITDA +8%; Weakening Industrial Activity and Volatile Energy Markets
OC Oerlikon / Key word(s): Quarter Results
Q3 Sales Growth of 7%, EBITDA +8%; Weakening Industrial Activity and Volatile Energy Markets
03-Nov-2022 / 06:31 CET/CEST
Release of an ad hoc announcement pursuant to Art. 53 LR
The issuer is solely responsible for the content of this announcement.
Polymer Processing Solutions achieved 6% sales growth, 12.3% FX adjusted, and 17% operational EBITDA growth in the third quarter. Q3 orders -16.8%, -12.8% FX adjusted. Year-to-date orders +12% and sales +21%.
Surface Solutions increased sales by 7%, 12.6% FX adjusted in Q3. Operational EBITDA margin transitorily impacted by product mix and higher energy costs.
2022 Group Guidance updated: Oerlikon expects sales >CHF 2.9 billion and operational EBITDA margin of 17.0–17.5%.
Key figures for the Oerlikon Group as of September 30, 2022 (in CHF million)
Q3 2022 Q3 2021 ∆ 9M 2022 9M 2021 ∆
Order intake
764
835
-8.5%
2 327
2 124
9.6%
Order backlog
837
843
-0.6%
837
843
-0.6%
Sales
742
695
6.7%
2 174
1 891
14.9%
Operational EBITDA1
126
117
7.6%
373
319
16.8%
Operational EBITDA margin1
17.0%
16.8%
20 bps
17.1%
16.9%
20 bps
Operational EBIT1
72
61
19.7%
208
159
30.3%
Operational EBIT margin1
9.8%
8.7%
110 bps
9.5%
8.4%
110 bps
1 For the reconciliation of operational and unadjusted figures, please see tables I and II on page 2 of this news release.
Pfaeffikon, Schwyz, Switzerland – November 3, 2022 – “Our teams have executed extremely well in the first nine months of the year against a clearly more difficult macroeconomic environment. Leading indicators signal an upcoming downturn, however, the timing and scope are difficult to predict. We are already implementing measures to mitigate potential impacts, and remain confident in our mid-term strategy,” said Michael Suess, Executive Chairman, Oerlikon Group.
“Based on our year-to-date performance, we are now expecting Group sales to exceed CHF 2.9 billion and the operational EBITDA margin to be between 17.0% and 17.5% for the full year,” added Suess.
Robust Q3 2022 Performance
Group order intake decreased by 8.5% to CHF 764 million, attributed to Polymer Processing Solutions’ record order intake in Q3 2021. Sales increased by 6.7% to CHF 742 million. At constant exchange rates, Group sales increased by 12.5%.
Operational EBITDA for the third quarter improved by 7.6% to CHF 126 million, and the operational EBITDA margin improved by 20 basis points to 17.0%. Q3 operational EBIT was CHF 72 million, or 9.8% of sales (Q3 2021: CHF 61 million; 8.7%). The margin improvements are attributed to higher sales and the benefits of cost actions executed by the Group.
Group Q3 unadjusted EBITDA was CHF 126 million, or 16.9% of sales (Q3 2021: CHF 115 million, 16.6%), and EBIT was CHF 73 million, or 9.8% (Q3 2021: CHF 58 million, 8.3%). The reconciliation of the operational and unadjusted figures can be seen in the tables below.
Table I: Reconciliation of Q3 2022 and 9M 2022 operational EBITDA and EBITDA1
In CHF million
Q3 2022
Q3 2021
9M 2022
9M 2021
Operational EBITDA
126
117
373
319
Income/expenses related to restructuring
0
0
0
1
Expenses related to discontinued activities
0
–
-3
–
Expenses related to acquisition and integration costs
-1
-2
-6
-5
EBITDA
126
115
363
315
Table II: Reconciliation of Q3 2022 and 9M 2022 operational EBIT and EBIT1
In CHF million
Q3 2022
Q3 2021
9M 2022
9M 2021
Operational EBIT
72
61
208
159
Income/expenses related to restructuring
0
0
0
1
Expenses related to discontinued activities
0
–
-4
–
Impairment charges
0
-1
0
-3
Expenses related to acquisition and integration costs
-1
-2
-6
-5
EBIT
73
58
198
152
1 All amounts (including totals and subtotals) have been rounded according to normal commercial practice. Thus, an addition of the figures presented can result in rounding differences.
2022 Group Guidance updated
For the full year, Oerlikon expects sales to exceed CHF 2.9 billion (previously around CHF 2.9 billion) and the operational EBITDA margin to be between 17.0 and 17.5% (previously around 17.5%).
Division Overview
Surface Solutions division
Key figures for the Surface Solutions division as of September 30, 2022 (in CHF million)
Q3 2022 Q3 2021 ∆
9M 2022
9M 2021
∆
Order intake
346
332
4.2%
1 070
1 004
6.6%
Order backlog
218
177
22.7%
218
177
22.7%
Sales (to third parties)
347
323
7.4%
1 026
947
8.4%
Operational EBITDA
59
59
-0.8%
180
174
3.7%
Operational EBITDA margin
16.8%
18.2%
-140 bps
17.4%
18.2%
-80 bps
Despite softening industrial activity, Surface Solutions increased order intake by 4.2% to CHF 346 million and sales by 7.4% to CHF 347 million. The higher sales were attributed to recovery in aerospace and in automotive, the latter driven by gradually easing of the supply-chain shortages.
The Q3 operational EBITDA margin decreased by 140 basis points to 16.8%, reflecting product mix effects and higher energy costs. Operational EBIT was CHF 22 million, or 6.4% of sales (Q3 2021: CHF 19 million, 6.0%). The division’s unadjusted Q3 EBITDA was CHF 59 million or 16.9% of sales (Q3 2021: CHF 58 million, 18.0%). EBIT was CHF 23 million, or 6.5% of sales (Q3 2021: CHF 18 million, or 5.5%).
Polymer Processing Solutions division
Key figures for the Polymer Processing Solutions division as of September 30, 2022 (in CHF million)
Q3 2022 Q3 2021 ∆ 9M 2022 9M 2021 ∆
Order intake
418
503
-16.8%
1 257
1 120
12.2%
Order backlog
620
665
-6.9%
620
665
-6.9%
Sales (to third parties)
395
372
6.1%
1 147
944
21.5%
Operational EBITDA
65
55
17.4%
188
137
37.6%
Operational EBITDA margin
16.4%
14.8%
160 bps
16.4%
14.5%
190 bps
Polymer Processing Solutions delivered another quarter of robust results. Sales increased by 6.1% to CHF 395 million. Order intake was sustained at a high level at CHF 418 million. Compared to the prior year, order intake was lower due to the record level of order intake in Q3 2021.
Q3 operational EBITDA improved by 17.4% to CHF 65 million. The operational EBITDA margin of 16.4% was 160 basis points higher year-over-year, due to improved operating leverage and cost control. Operational EBIT was CHF 51 million or 12.9% of sales (Q3 2021: CHF 40 million, 10.9%). The division’s unadjusted Q3 EBITDA was CHF 65 million, or 16.4% of sales (Q3 2021: CHF 52 million, 13.9%), and EBIT was CHF 51 million or 12.8% of sales (Q3 2021: CHF 37 million, 9.9%).
Additional Information
Oerlikon will present its results during a conference call today beginning at 10:30 CET. To participate, please click on this link to join the webcast.
To ask questions in the Q&A session, please dial in.
Country
Local toll call numbers
Switzerland
+41 58 310 50 00
UK
+44 207 107 06 13
USA
+1 631 570 56 13
The media release can be found at www.oerlikon.com/pressreleases and www.oerlikon.com/ir.
About Oerlikon
Oerlikon (SIX: OERL) is a global innovation powerhouse for surface engineering, polymer processing and additive manufacturing. The Group’s solutions and comprehensive services, together with its advanced materials, improve and maximize the performance, function, design and sustainability of its customers’ products and manufacturing processes in key industries. Pioneering technology for decades, everything Oerlikon invents and does is guided by its passion to support customers’ goals and foster a sustainable world. Headquartered in Pfaeffikon, Switzerland, the Group operates its business in two divisions – Surface Solutions and Polymer Processing Solutions. It has a global footprint of more than 12 000 employees at 202 locations in 37 countries and generated sales of CHF 2.65 billion in 2021.
For further information, please contact:
Sara Vermeulen AnastasiHead of Group Communications
Tel.: +41 58 360 98 52
sara.vermeulen@oerlikon.com
www.oerlikon.com Stephan Gick
Head of Investor Relations
Tel: +41 58 360 98 50
stephan.gick@oerlikon.com
www.oerlikon.com
OC Oerlikon Corporation AG, Pfaeffikon together with its affiliates, hereinafter referred to as “Oerlikon”, has made great efforts to include accurate and up-to-date information in this document. However, Oerlikon makes no representation or warranties, expressed or implied, as to the truth, accuracy or completeness of the information provided in this document. Neither Oerlikon nor any of its directors, officers, employees or advisors, nor any other person connected or otherwise associated with Oerlikon, shall have any liability whatsoever for loss howsoever arising, directly or indirectly, from any use of this document.
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End of Inside Information Language: English Company: OC Oerlikon Churerstrasse 120 CH - 8808 Pfäffikon SZ Switzerland Phone: +41 58 360 96 96 Fax: +41 58 360 91 96 E-mail: info@oerlikon.com Internet: www.oerlikon.com ISIN: CH0000816824 Valor: 863037 Listed: Regulated Unofficial Market in Berlin, Dusseldorf, Frankfurt, Munich, Stuttgart, Tradegate Exchange; SIX Swiss Exchange EQS News ID: 1478035
End of Announcement EQS News Service
1478035 03-Nov-2022 CET/CEST