SILTRONIC AG
DGAP-News: Siltronic AG / Key word(s): Annual Report
Siltronic AG: Siltronic closes 2020 financial year in line with expectations - dividend proposal of EUR 2.00 per share
2021-03-09 / 06:56
The issuer is solely responsible for the content of this announcement.
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Press release
Siltronic AG
Einsteinstr. 172
81677 Munich
www.siltronic.com
Siltronic closes 2020 financial year in line with expectations - dividend proposal of EUR 2.00 per share
- Sales of EUR 1,207.0 million down year-on-year, as expected (2019: EUR 1,270.4 million)
- EBITDA decreased to EUR 332.0 million and EBITDA margin to 27.5 percent (2019: EUR 408.7 million; 32.2 percent)
- EBIT of EUR 192.2 million and EBIT margin of 15.9 percent significantly below prior year, also due to increased
depreciation (2019: EUR 298.3 million; 23.5 percent)
- Dividend proposal of EUR 2.00 per share for financial year 2020
- Forecast for 2021 - Significant growth in wafer demand expected
Munich, Germany, March 9, 2021 - As expected, sales and earnings of Siltronic AG (MDAX/TecDAX: WAF) declined in 2020.
"2020 was characterized by a surge in digitization triggered by the corona pandemic, which lead to a slightly higher
than expected demand for silicon wafers. Average selling prices (ASP) per wafer area were lower than in 2019. In H2
2020, sales and earnings were additionally burdened by the strength of the Euro, particularly against the US dollar. In
this environment, we focused on further strengthening our technological capabilities and increasing our productivity.
The health of our workforce has always been in our focus during the pandemic," said Dr. Christoph von Plotho, CEO of
Siltronic AG.
Business development in 2020
Change Change
Q4 Q3 Q4 Q4 to Q4 to
2020 2019 2020 2020 2019 Q3 Q4
in EUR
Sales million 1,207.0 1,270.4 -63.4 284.5 299.3 304.3 -14.8 -19.8
in % -5.0 -4.9 -6.5
in EUR
Cost of sales million 867.5 812.8 54.7 211.7 221.0 207.4 -9.3 4.3
in % 6.7 -4.2 2.1
in EUR
Gross profit million 339.5 457.6 -118.1 72.8 78.2 96.9 -5.4 -24.1
in % -25.8 -6.9 -24.9
Gross margin in % 28.1 36.0 25.6 26.1 31.8
in EUR
EBITDA million 332.0 408.7 -76.7 67.2 80.1 90.0 -12.9 -22.8
in % -18.8 -16.1 -25.3
EBITDA margin in % 27.5 32.2 23.6 26.8 29.6
Depreciation, amortization and impairment less in EUR
reversals thereof million -139.8 -110.4 -29.4 -38.8 -36.5 -33.3 -2.3 -5.5
in EUR
EBIT million 192.2 298.3 -106.1 28.4 43.6 56.7 -15.2 -28.3
in % -35.6 -34.9 -49.9
EBIT margin in % 15.9 23.5 10.0 14.6 18.6
in EUR
Financial result million -3.0 4.4 -7.4 1.4 -0.5 1.0 1.9 0.4
in EUR
Result before income taxes million 189.2 302.7 -113.5 29.8 43.2 57.7 -13.4 -27.9
in % -37.5 -31.0 -48.4
in EUR
Income taxes million -2.4 -41.7 39.3 11.1 -4.0 -12.3 15.1 23.4
Tax rate in % 1 14 -37 9 21
in EUR
Result for the period million 186.8 261.0 -74.2 40.9 39.2 45.4 1.7 -4.5
in % -28.4 4.3 -9.9
Earnings per share in EUR 5.36 7.52 -2.16 1.17 1.08 1.21 0.09 -0.05 At EUR 1,207.0 million, Siltronic AG's sales in 2020 were five percent down y-o-y (2019: EUR 1,270.4 million). The digitization push triggered by the corona pandemic had a positive impact on wafer area sold. At the same time, the increased wafer area could not compensate for the decline in sales resulting from the reduction in ASP in Euro y-o-y. The main drivers of ASP in 2020 were price pressure in the first months of the year, the increase in the exchange rate of the Euro against the US dollar and negative effects in the product mix in H2 2020.
The increase in cost of sales by EUR 54.7 million resulted from higher wafer area sold and from the increase in scheduled depreciation of property, plant and equipment. Excluding the increased depreciation, cost of sales per wafer area decreased significantly y-o-y. This result is due to the success of cost reduction programs and exchange rate effects. Gross margin decreased from 36.0 percent in 2019 to 28.1 percent due to declining ASP and increased depreciation.
EBITDA of EUR 332.0 million was just under 19 percent below 2019 (EUR 408.7 million). The main reasons were the lower ASP in invoicing currency, the effects of the product mix shift and additional expenses for consultancy costs of around EUR 12 million relating to the tender offer of GlobalWafers, which are included in administrative expenses. The EBITDA margin reached a solid 27.5 percent (2019: 32.2 percent).
Earnings before interest and taxes (EBIT) of EUR 192.2 million were significantly lower than 2019 (EUR 298.3 million). In addition to price pressure and the strength of the Euro, higher scheduled depreciation had a negative impact. EBIT margin in 2020 was 15.9 percent compared to 23.5 percent in 2019.
The Group tax rate in 2020 was one percent only, compared to 14 percent in 2019. This is due to the increased share of profit from subsidiaries with low effective tax rates and tax incentives due to the Corona pandemic.
Profit for the period decreased from EUR 261.0 million to EUR 186.8 million. Of this, EUR 160.8 million (2019: EUR 225.6 million) are attributable to Siltronic AG shareholders. Earnings per share amounted to EUR 5.36 , compared with EUR 7.52 in 2019.
Development of net cash flow and net financial assets
In EUR million 2020 2019 Change Cash flow from operating activities 236.7 385.3 -148.6 Proceeds/payments for capital expenditure including intangible assets -204.7 -348.9 144.2 Free cash flow 32.0 36.4 -4.4 Cash-effective change in customer prepayments 45.4 44.9 0.5 Net cash flow 77.4 81.3 -3.9
In 2020, Siltronic invested EUR 187.6 million in property, plant and equipment and intangible assets. In addition to basic investments, this includes spending on capabilities, capacity expansion and investments in additional Epi reactors. This will secure and further expand Siltronic's position as one of the technology leaders.
The high cash outflows for property, plant and equipment and intangible assets and the refunding of customer prepayments were easily financed from operating activities. At EUR 77.4 million, net cash flow in 2020 was slightly below 2019 (EUR 81.3 million) and in line with expectations.
Net financial assets decreased by only EUR 89.7 million to EUR 499.2 million (2019: EUR 588.9 million) due to the positive net cash flow despite the dividend payment of EUR 90 million and the refunding of customer prepayments. Dividend proposal of EUR 2.00 per share
Based on the business results achieved, the Executive Board and Supervisory Board of Siltronic AG will propose a dividend of EUR 2.00 per share for 2020 to the Annual General Meeting on April 29, 2021. This corresponds to a dividend payment of 60 million euros and thus a pay-out ratio of 37.3 percent.
Forecast 2021 - challenges and opportunities
Siltronic AG has made a good start to 2021. The company is experiencing high demand for wafers and loading is good to very good.
The ongoing corona pandemic makes it considerably more difficult to issue a forecast for Siltronic AG, as the associated macroeconomic effects remain difficult to assess.
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