Basler : Three-month Report 2021 - PDF (898 kB)

3-MONTH REPORT

2021

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3-MONTH REPORT 2021

KEY FIGURES

INTERIM GROUP MANAGEMENT REPORT JANUARY - MARCH 2021

KEY FIGURES

OVERVIEW OF THE FIRST THREE MONTHS OF 2021:

► Incoming orders: € 67.3 million (previous year: € 52.9 million, +27 %)

order backlog. We would like to take this opportunity to thank our customers for their patience and trust. We will continue to manage our supply chain with highest priority in order to successfully master the challenging situation in the supply markets.

			Changes to
in € m*	QI 2021	QI 2020	previous year
Sales revenues	54.6	43.7	25 %
Incoming orders	67.3	52.9	27 %
Gross results	29.8	23.0	30 %
Gross profit margin	54.6 %	52.6 %	2,0 Pp,
Full costs for research and
development	7.0	6.2	13 %
Research and development
ratio	12.8 %	14.2 %	-1,4 Pp,
EBITDA	14.7	9.5	55 %
EBIT	10.1	6.4	58 %
EBT	9.9	6.3	57 %
EBT Margin	18.1 %	14.4 %	3,7 Pp,
Net income	7.8	4.7	66 %
Weighted average number of
shares	10,004,554	10,007,127	0 %
Result per share (€)	0.78	0.47	66 %
Cash flow from operating
activities	4.7	2.0	<+100 %
Cash flow from investing
activities	-3.6	-3.9	-7 %
Free Cash flow	1.0	-1.9	n.a.

*unless otherwise stated

			Changes to
in € m*	03/31/2021	12/31/2020	previous year
Total assets	202.0	190.1	6 %
Long-term assets	94.4	95.0	-1 %
Equity	123.6	114.9	8 %
Liabilities	78.4	75.2	4 %
Equity ratio	61.2 %	60.4 %	0,8 Pp,
Net cash	23.0	23.0	0 %
Working Capital	36.6	27.3	34 %
Number of employees for the
period (full time equivalents)	825	808	2 %
Share price (XETRA) in €	98.20	72.00	36 %
Number of shares in
circulation	10,006,164	10,005,264	<1 %
Market capitalization	982.6	720.4	36 %

*unless otherwise stated

► Sales: € 54.6 million (previous year:€ 43.7 million, +25 %)

► EBITDA: € 14.7 million (previous year: € 9.5 million, +55 %)

► EBT: € 9.9 million (previous year:€ 6.3 million, +57 %)

► Net result: € 7.8 million (previous year: € 4.7 million, +66 %)

► Operating cash flow: € 4.7 million (previous year: € 2.0 million, > +100 %)

► Cash flow from investing activities: € -3.6 million

(previous year: € -3.9 million, -7 %)

► Free cash flow : € 1.0 million (previous year: € -1.9 million, n.a.)

Dear Ladies and Gentlemen,

After the strong increase in demand already at the end of 2020, we started the new fiscal year 2021 with a relatively strong order backlog. In the first quarter, this momentum strengthened and we were able to increase incoming orders, sales and earnings at high growth rates, thus laying a very good foundation for the current fiscal year.

Despite ongoing challenges due to corona and an extremely tight situation in the supply markets for semiconductor and electronics, we were fully operational and the production quantity was increased by 43 % compared to the previous year. The very strong demand together with bottlenecks in the material supply, however, led to an extension of our delivery times and a further increase of the

Beyond the operational challenges, we made considerable progress in our strategic organizational and product development projects, further contributing to our long-term growth plans. In addition, a new organizational structure was implemented on April 1 to provide even better support for the implementation of our corporate strategy.

Thanks in particular to our strong position in Asia, we were able to benefit from the current upswing in the best possible way and clearly better than the industry, thus further expanding our market shares. The two-digit increase in sales led to considerable economies of scale within the group. As a result, we increased our net result by more than 60 % compared to the previous year. At 18 %, the pre-tax return rate was well above our long-term target of approximately 12 %.

The signs for a positive global economic development in 2021 are good and we expect the strong demand cycle from the semiconductor and electronics sectors in particular to continue in the coming months. We continue to expect the demand for image processing components from the general engineering and automotive sectors to improve gradually over the course of the year. We also expect the situation on the procurement markets to deteriorate further in the coming months and not to ease until the end of the year.

The successful start to the year and the outlook for the coming quarters motivate us to continue scaling the global organization and, with great passion and powerful investments, to shape the future of Basler and our transformation from a camera maker to a full-range provider.

With this compact 3-month report, we would like to give you a deeper insight into the development of the fiscal year so far and hope you enjoy reading it:

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3-MONTH REPORT 2021

INTERIM GROUP MANAGEMENT REPORT JANUARY - MARCH 2021

INTERIM GROUP MANAGEMENT REPORT JANUARY - MARCH 2021

BUSINESS DEVELOPMENT

PRODUCT LAUNCHES

OUTLOOK

INTERIM MANAGEMENT REPORT INCLUDING ESSENTIAL SUPPLEMENTARY

The group closed the first three months with very positive results, which were above expectations. Compared to the same period of the previous year, sales increased by 25 % and incoming orders by 27 %. The recovery in the capital goods markets for semiconductors and electronics continued in the first quarter. Demand from the general machinery and plant engineering sector and from the automotive industry remained weak, even though there were slight signs of recovery towards the end of the quarter.

Fundamentally, these market trends are also confirmed by the orders and sales of the German machine vision components industry. However, according to the German Engineering Federation (VDMA), these were only slightly positive in the first three months compared to the previous year, thus Basler gained further market shares. As of the end of March 2021, the German Engineering Federation (VDMA) reported a growth in sales of 5 % for German manufacturers of machine vision components for the year 2021. According to the VDMA, incoming orders in the industry increased by 15 % in the same period.

The Basler group is also affected by the global shortage of semiconductor components. So far, the company has been able to successfully manage this through its market position, long-term supplier relationships and professional supply chain management, ensuring a supply of materials for a high volume production level. However, the situation on the procurement markets for semiconductor and electronic components is very tense and is not expected to improve until the end of the fiscal year.

.

All activities related to the development and launch of new products were running at high intensity during the first three months. In total, € 7.0 million were spent for development (previous year: € 6.2 million). In the area of market communications, there was again a stronger focus on online activities in order to reach customers during the Corona pandemic.

Mid January, Basler announced the expansion of the boost camera series with CoaXPress 2.0 (CXP 2.0) interface and launched six new high-resolution models based on this technology. Thanks to their CXP 2.0 interface, Basler boost cameras are perfectly suitable for applications with image transmission distances of up to 40 metres, requiring high data rates and resolutions. These can be - for example - applications in the semiconductor industry, photovoltaics, display inspection, the printing and packaging industry, and in medical technology.

Furthermore, a new processing kit was introduced on the embedded world 2021 DIGITAL rethinking embedded vision show. The board developed by Basler is optimized for a variety of vision applications - both from a hardware and software point of view. Due to its design developed for an industrial use, the development kit can not only be used for prototyping but also in series production. Using this embedded processing kit, developers can reach a workable vision solution in a very fast way. Moreover, the new cooperation activities with Amazon Web Services were presented at the fair, aiming to provide customers with embedded vision systems with cloud connectivity and Algorithms.

Within the transformation from a camera maker to a full-range provider the range of accessories - cables, lenses and lights - has been continuously expanded. Additional web tools were also made available to the customer for the targeted selection of image processing components.

The Basler group closed the first three months of the financial year 2021 very successfully and above expectations starting into the second quarter 2021 with a positive ratio between incoming orders and sales.

According to current information, the positive demand trend for image processing components in the application areas for semiconductor and electronics as well as in logistics will continue in the second quarter and is expected to weaken in the second half of the year due to seasonal factors. The management also expects the demand for image processing components in other automation fields to pick up again in the course of the year, with demand from the medical sector also gradually increasing.

Due to the strong business development in the first quarter and the ongoing strong incoming orders in the month of April, the company increases its forecast for 2021 and henceforth expects group sales of € 205 - 225 million at a pre-tax result of 13 - 15,5 %. This forecast corridor reflects the strong momentum on the sales markets and the risks on the procurement markets described above.

The management is positive about the future and maintains its medium-term planning to reach sales of approximately € 250 million in 2023.

DISCLOSURES OF THE ANNUAL FINANCIAL STATEMENT OF DECEMBER 31, 2020 ACCORDING TO IFRS

REPORT ON PROFIT, FINANCE, AND ASSET SITUATION

SALES AND INCOMING ORDERS, COSTS OF SERVICE PROVISION

Compared to the same period of 2020, sales increased by 25 % to € 54.6 million (previous year: € 43.7 million). Incoming orders increased by 27 % to € 67.3 million (previous year: € 52.9 million). The geographical distribution of sales is heavily weighted towards Asia at 56 %. The relatively strong demand from the semiconductor and electronics sector as well as the fast recovery of China after the Corona lockdown additionally affected the Asia portion positively. 27 % of sales came from the EMEA region and 17 % from the Americas.

REVENUE

For the last five quarters (in € million)

						67
53	45				53	55
44	39	40	36	41
Q1	Q2	Q3	Q4	Q1
			2020			2021

 Sales  Order entry

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3-MONTH REPORT 2021

INTERIM GROUP MANAGEMENT REPORT JANUARY - MARCH 2021

INTERIM GROUP MANAGEMENT REPORT JANUARY - MARCH 2021

REVENUE SPLIT BY REGIONS

The gross profit margin significantly improved in the first quarter to 54.6 % (previous year: 52.6 %). Due to high utilization, production had lower overhead

ASSET SITUATION

CASHFLOW

Basler Headquarters Germany	Basler O•ce Korea
Basler, Inc. USA
	Basler O•ce Japan
	Basler Co., Ltd. China
	Basler Taiwan, Inc. Taiwan
	Basler Asia, Ltd. Singapore

costs per unit. In addition, very good results were achieved in reducing material costs. Overall, any price declines on the markets were more than compensated for.

EARNINGS BEFORE TAXES

For the last five quarters

Where as the long-term assets remained on the level of December 31, 2020, the short-term assets increased by approximately € 12.5 million. This is mainly due to the considerable increase of trade accounts receivable because of the high level of sales. Furthermore, inventories slightly increased. Because of the order situation, trade accounts payable increased also.

DEVELOPMENT OF EQUITY

Equity amounted to € 123.6 million (December 31, 2020: € 114.9 million). The equity ratio increased to 61.2 % on March 31, 2021, compared to 60.4 % on

For the last five quarters (in € million)

	13.3	12.3
	9.7	6.9
	3.7	4.7
2.0	5.3	1.0
	-1.9

Revenue Breakdown by Regions*:

17 % 27 % 56 %

Americas EMEA Asia

GROSS PROFIT

Development of gross margin

14.4 %	14.6 %			18.1 %
13.2 %
			5.6 %	9.9
6.3	6.6	5.3
*as of March 31, 2021			2.3
Q1	Q2	Q3	Q4	Q1
		2020		2021
 EBT in € million	 EBT in %

December 31, 2020.

CASH FLOW AND LIQUIDITY

The operating cash flow amounted to € 4.7 million (previous year: € 2.0 million). Compared to the same period of 2020, this increase is mainly due to the earnings after taxes which increased by € 3.1 million. The operating cash flow was burdened by working capital effects, particularly by the increase of raw materials and supplies. The cash flow from investing activities amounted to € -3.6 million (previous year: € -3.9 million).

-3.9		-4.3	-5.4	-3.6
		 FCF	 OCF	 ICF
	-9.7
Q1	Q2	Q3	Q4		Q1
		2020		2021

52.6 %53.5 %51.4 %

54.6 %

Liquid assets slightly decreased from € 47.9 million (December 31, 2020) to

					50.4 %
23.0	24.2	20.7	20.8

Q1

Q2

Q3

Q4

2020

• Gross Margin %
• Gross Profit Margin in € million

Compared to the previous year, earnings before taxes significantly increased by

29.8 € 3.6 million to € 9.9 million (previous year: € 6.3 million) due to economies of scale. In addition to the considerable increase of the gross profit, lower material cost expenses due to the Corona pandemic led to the very strong increase in earnings, albeit with much less impact.

	The period surplus amounted to € 7.8 million and thus was 66 % over the
	previous year's figure of € 4.7 million. The result per share (diluted/undiluted)
Q1	amounted to € 0.78 (previous year: € 0.47).
2021

• 47.0 million. The net operating liquidity after deduction of all bank liabilities amounted to € 23 million (previous year: € 13 million). The high liquidity ensures the financial stability of the company and is the basis for a powerful growth strategy

EMPLOYEES

At the reporting date of March 31, 2021, the Basler group employed 825 (December 31, 2020: 813) employees (full-time equivalents).

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3-MONTH REPORT 2021

INTERIM GROUP MANAGEMENT REPORT JANUARY - MARCH 2021

INTERIM GROUP MANAGEMENT REPORT JANUARY - MARCH 2021

EVENTS AFTER THE END OF THE INTERIM REPORTING PERIOD

REPORT ON SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES (ENTITIES AND INDIVIDUALS)

On April 19, 2021, the merger of the wholly owned subsidiary Silicon Software GmbH, Mannheim, into the Basler AG, Ahrensburg, was entered in the commercial registers. As a result, Silicon Software GmbH is no longer an independent enterprise, but has been fully absorbed into Basler AG. The operational integration of the employees and processes has already been completed in 2020.

OPPORTUNITIES AND RISKS REPORT

Regarding significant opportunities and risks of the probable development of the company, we refer to the opportunities and risks described in the group management report as of December 31, 2020. Existing risks are continuously monitored and countermeasures are initiated. The regular risk inventory will take place in the third quarter of 2021.

For significant changes of the consolidated balance sheet, the consolidated income statement as well as the consolidated cash flow statement, we refer to the report on the profit, finance and asset situation. The statements on IFRS 9 made in the consolidated financial statements as at December 31, 2020 have not changed in the first quarter of the current financial year due to the Corona pandemic. To date, the Basler group has not been able to identify any changes in the payment behaviour of customers that would have led to a different valuation of trade receivables. There were no findings that would have led to a revaluation of the lease accounting in accordance with IFRS 16 as at the reporting date.

BASLER IN THE CAPITAL MARKET

INDEX

150.00

125.00

SHAREHOLDER STRUCTURE

The share capital of Basler AG amounted to € 10.5 million at the end of the quarter on March 31, 2020, divided into 10.5 million no-par-value bearer shares at € 1.00 each.

5 % 4 %

6 %

5 %

			Norbert Basler Holding GmbH (53 %)
53 %			Treasury Shares (5 %)
		Dr. Dietmar Ley (CEO) (4 %)
			Invesco Advisers; Inc. (6 %)
27 %			7-Industries Holding B.V. (5 %)
		Free Float (27 %)

SHAREHOLDINGS MANAGEMENT

	03/31/2021 Number	12/31/2020 Number
	of shares in pieces	of shares in pieces
Supervisory Board
Norbert Basler	-	-
Dorothea Brandes	-	-
Horst W. Garbrecht	-	-
Dr. Marco Grimm	-	-
Prof. Dr. Eckart Kottkamp	-	-
Prof. Dr. Mirja Steinkamp	-	-
Management Board
Arndt Bake	2,075	1,850
Dr. Dietmar Ley	379,206	378,882
Hardy Mehl	5,901	5,550
Alexander Temme	0	0

SHARE BUYBACK PROGRAM

NOTES TO THE INTERIM STATEMENT ACCORDING TO IFRS

The interim statement of Basler was prepared according to the International Financial Reporting Standards (IFRS) as applicable within the European Union (EU), the interpretations of the International Financial Reporting Interpretations Committee (IFRIC), as well as the Standing Interpretations Committee (SIC). The interim statement was prepared according to the provision of the IAS 34.

The interim financial statements as at March 31, 2021 are unaudited and have not been reviewed by an auditor. In principle, the same accounting and valuation methods are applied in the interim financial statements as in the consolidated financial statements as at December 31, 2020.

100.00
75.00
50.00
 Basler Share	 TDXP Index
0.00
2020/12/30	2021/01/31	2021/02/28	20	21	/03/31

With the approval of the supervisory board, on December 9, 2020, the management board of Basler AG decided to terminate the share buyback program initially re-started in 2020 on March 11, 2020, and dormant at that time, and to launch a new share buyback program on the basis of the annual general meeting's resolution of May 26, 2020. The new share buyback program has a total volume of up to € 10 million and a term until May 25, 2020.

The basis for the share buyback program is the authorisation pursuant to § 71 para. 1 no. 8 of the German Stock Corporation Act (AktG) in accordance with the resolution of the Annual General Meeting of May 26, 2020, on agenda item 8 of this Annual General Meeting. According to this, the company may acquire treasury shares in the total amount of up to € 1,050,000.00 divided into 1,050,000 shares on the basis of the currently registered share capital. The authorisation is valid until the end of May 25, 2025.

• 72.00 OPENING PRICE ON JANUARY 1, 2021
• • 98.20 CLOSING PRICE ON MARCH 31, 2021

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