DGAP-News: Infineon Technologies AG / Key word(s): Quarter Results/Forecast
Infineon Technologies AG: POSITIVE REVENUE AND EARNINGS TRAJECTORY CONTINUING; STRONG FREE CASH FLOW; ANNUAL FORECAST
RAISED SLIGHTLY AGAIN
2021-05-04 / 07:30
The issuer is solely responsible for the content of this announcement.
- Q2 FY 2021: REVENUE EUR2.7 BILLION; SEGMENT RESULT EUR470 MILLION; SEGMENT RESULT MARGIN 17.4 PERCENT; FREE CASH FLOW
- OUTLOOK FOR Q3 FY 2021: BASED ON AN ASSUMED EXCHANGE RATE OF USUSD1.20 TO THE EURO, REVENUE IS PREDICTED TO COME IN
BETWEEN EUR2.6 BILLION AND EUR2.9 BILLION. AT THE MID-POINT OF THE GUIDED REVENUE RANGE, THE SEGMENT RESULT MARGIN IS
EXPECTED TO BE AROUND 18 PERCENT
- OUTLOOK FOR FY 2021: BASED ON AN ASSUMED EXCHANGE RATE OF USUSD1.20 TO THE EURO, REVENUE OF AROUND EUR11.0 BILLION (PLUS
OR MINUS 3 PERCENT) IS EXPECTED. AT THE MID-POINT OF THE GUIDED REVENUE RANGE, THE SEGMENT RESULT MARGIN IS EXPECTED TO
COME IN AT AROUND 18 PERCENT. INVESTMENTS ARE STILL PLANNED TO BE AROUND EUR1.6 BILLION. FREE CASH FLOW IS NOW
ANTICIPATED TO EXCEED EUR1.2 BILLION
Neubiberg, Germany - 4 May 2021 - Today, Infineon Technologies AG is reporting results for the second quarter of the
2021 fiscal year (period ended 31 March 2021).
"The semiconductor market is booming; electronics that help accelerate the energy transition and make work and home
life easier remain in high demand. The push for digitalization continues unabated. Infineon is firmly on course to meet
its targets for the current fiscal year," said Dr. Reinhard Ploss, CEO of Infineon. "Demand greatly exceeds supply for
the majority of applications. Infineon's manufacturing facilities are running at full speed and we continue to invest
in additional capacity. We see bottlenecks in those segments where we depend on chips supplied by foundries, especially
in the case of automotive microcontrollers and IoT products. We are doing everything we can to provide our customers
with the best possible support in this situation."
The Cypress Semiconductor Corporation ("Cypress") has been fully consolidated since 16 April 2020. The comparability of
current figures with those of previous periods is therefore limited.
Euro in millions Q2 FY21 Q1 FY21 +/- in %
Revenue 2,700 2,631 3
Segment Result 470 489 (4)
Segment Result Margin 17.4% 18.6%
Income (loss) from continuing operations 209 256 (18)
Income (loss) from discontinued operations, net of income taxes (6) - ---
Net income (loss) 203 256 (21)
Basic earnings (loss) per share from continuing operations^1 0.15 0.19 (21)
Basic earnings (loss) per share from discontinued operations^1 - - -
Basic earnings (loss) per share^1 0.15 0.19 (21)
Diluted earnings (loss) per share from continuing operations^1 0.15 0.19 (21)
Diluted earnings (loss) per share from discontinued operations^1 - - -
Diluted earnings (loss) per share^1 0.15 0.19 (21)
Adjusted earnings (loss) per share diluted^2 0.24 0.28 (14)
Gross margin 36.0% 37.4%
Adjusted gross margin^2 39.3% 40.3%
^1 The calculation for earnings per share and for adjusted earnings per share is based on unrounded figures.
^2 The reconciliation of net income to adjusted net income and adjusted earnings per share as well as of cost of goods sold to adjusted cost of goods sold and adjusted gross margin can be found in the quarterly information at www.infineon.com. GROUP PERFORMANCE IN SECOND QUARTER OF 2021 FISCAL YEAR In the second quarter of the 2021 fiscal year, Group revenue rose by EUR69 million to EUR2,700 million, compared to EUR2,631 million in the preceding three-month period. The 3 percent growth in revenue was driven by brisk demand, particularly in the Automotive segment (ATV) and to a lesser extent in the Power & Sensor Systems segment (PSS), whereas revenue generated in the Industrial Power Control (IPC) and Connected Secure Systems (CSS) segments declined slightly.
The gross margin came in at 36.0 percent, compared to 37.4 percent in the previous quarter. The adjusted gross margin was 39.3 percent after 40.3 percent one quarter earlier.
The Segment Result for the second quarter amounted to EUR470 million, compared to EUR489 million in the preceding three-month period, while the Segment Result Margin declined to 17.4 percent. The Segment Result Margin of 18.6 percent in the previous quarter benefitted from a number of positive non-recurring items such as research subsidies and patent-related revenue.
The non-segment result for the second quarter was a net loss of EUR156 million, compared to a net loss of EUR157 million in the previous quarter. The non-segment result for the three-month period contained EUR89 million of cost of goods sold, EUR58 million of selling, general and administrative expenses and EUR4 million of research and development expenses. Net other operating expenses amounting to EUR5 million were also recorded in the second quarter.
Operating income for the period from January to March 2021 amounted to EUR314 million, compared to EUR332 million in the preceding quarter.
The financial result came in at negative EUR42 million and was therefore down on the negative EUR26 million reported for the first quarter, which had benefitted from positive one-off items.
The tax expense increased from EUR49 million to EUR62 million quarter-on-quarter.
For the second quarter of the 2021 fiscal year, Infineon generated income from continuing operations totaling EUR209 million, down on the figure of EUR256 million reported for the first quarter. The loss from discontinued operations amounted to EUR6 million in the second quarter, compared to a break-even result for the previous three-month period. Net income for the second quarter was EUR203 million compared with EUR256 million in the first quarter.
Earnings per share from continuing operations amounted to EUR0.15 (basic and diluted), compared to EUR0.19 in the preceding three-month period. Adjusted earnings per share^3 (diluted) came in at EUR0.24 after EUR0.28 in previous quarter.
Investments - which Infineon defines as the sum of purchases of property, plant and equipment, purchases of other intangible assets and capitalized development costs - rose to EUR332 million in the second quarter of the current fiscal year, compared with EUR283 million in the preceding three-month period. At EUR368 million, depreciation and amortization remained unchanged from the previous quarter.
Free cash flow for the second quarter increased from EUR313 million to EUR407 million quarter-on-quarter. Net cash provided by operating activities from continuing operations increased to EUR742 million, up by EUR154 million compared to the previous quarter's corresponding figure of EUR588 million.
At the end of the second quarter of the 2021 fiscal year, the gross cash position stood at EUR3,444 million, compared to EUR3,334 million at 31 December 2020. Net debt increased from EUR3,369 million to EUR3,415 million over the course of the second quarter. Due to the increase in the exchange rate of the US dollar between the measurement dates, financial debt increased to EUR6,859 million at the end of the quarter under report, compared with EUR6,703 million at 31 December 2020.
OUTLOOK FOR THE THIRD QUARTER OF THE 2021 FISCAL YEAR Based on an assumed exchange rate of USUSD1.20 to the euro, Infineon expects to generate revenue of between EUR2.6 billion and EUR2.9 billion in the third quarter of the 2021 fiscal year. Revenue growth will continue to be held down by supply constraints, including the temporary shutdown of our manufacturing facilities in Austin, Texas, in February, as well as capacity limitations at foundries. Taking account of these developments, revenue in the CSS segment is expected to decline slightly, whereas the IPC segment - which is less severely affected by them than the other segments - is expected to grow revenue by a high single-digit percentage rate quarter-on-quarter. Revenue generated by the ATV and PSS segments is forecast to increase slightly. At the mid-point of the guided revenue range, the Segment Result Margin is expected to come in at about 18 percent.
OUTLOOK FOR THE 2021 FISCAL YEAR Based on its good performance in the first two quarters of the current fiscal year, and continuously strong momentum of the semiconductor market, Infineon again slightly raises its guidance for revenue and Segment Result Margin for the fiscal year as a whole, despite tight capacities at foundries. Based on an unchanged assumed exchange rate of USUSD1.20 to the euro, revenue is now forecast at around EUR11.0 billion (plus or minus 3 percent). All segments are expected to benefit from an improving supply situation and continued growth in demand during the second half of the fiscal year. At the mid-point of the guided revenue range, the Segment Result Margin is now expected to be about 18 percent.
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