News › Jen­op­tik achie­ves 2019 tar­gets; out­look is sub­ject to review

• Group reve­nue up to 855.2 mil­lion euros in 2019 (+2.5 percent)
• Rise in EBITDA to 134.0 mil­lion euros (+5 percent)
•  Stron­gest order intake in Q4; order intake for full year down to 812.6 mil­lion euros (-7.0 percent)
• Divi­dend pay­ment under review
• Noti­ceable effects of SARS-CoV‑2 in first half of the year

With reve­nue of 855.2 mil­lion euros, the Jen­op­tik Group achie­ved growth of 2.5 per­cent in the 2019 fis­cal year and excee­ded the high level of the prior year despite a dif­fi­cult mar­ket envi­ron­ment (prior year: 834.6 mil­lion euros). Momen­tum picked up as the year pro­gres­sed and, in line with expec­ta­ti­ons, the fourth quar­ter saw the stron­gest reve­nue of 259.5 mil­lion euros (prior year: 241.2 mil­lion euros), with growth coming from the Light & Optics and Light & Pro­duc­tion divi­si­ons. The solid busi­ness per­for­mance was dri­ven in par­ti­cu­lar by high demand from the semi­con­duc­tor equip­ment indus­try and good busi­ness deve­lo­p­ment in the Auto­ma­tion & Inte­gra­tion area. The com­pa­nies acqui­red in 2018 – Pro­do­max and the OTTO Group – con­tri­bu­ted 66.4 mil­lion euros of reve­nue in the past fis­cal year (prior year: 37.0 mil­lion euros).

On a regio­nal level, growth momen­tum came from abroad, in par­ti­cu­lar from North Ame­rica. Europe remained the region with the hig­hest reve­nue of 246.0 mil­lion euros (prior year: 244.7 mil­lion euros), clo­sely fol­lo­wed by the Ame­ri­cas with 239.7 mil­lion euros (prior year: 207.7 mil­lion euros). Jen­op­tik thus gene­ra­ted around 73 per­cent of reve­nue abroad in the past fis­cal year (prior year: 71 per­cent) – a proof of the suc­cessful imple­men­ta­tion of the company’s inter­na­tio­na­liza­tion strategy.

Despite hig­her func­tional costs and increased spen­ding for future growth, EBITDA impro­ved by 5.0 per­cent to 134.0 mil­lion euros in 2019 (prior year: 127.5 mil­lion euros). This was mainly the result of con­tri­bu­ti­ons made by the acqui­red com­pa­nies and posi­tive impacts from the first-time appli­ca­tion of the inter­na­tio­nal finan­cial report­ing stan­dard IFRS 16. The EBITDA mar­gin accor­din­gly increased to 15.7 per­cent (prior year: 15.3 per­cent). At 88.9 mil­lion euros, EBIT was 6.3 per­cent down on the prior-year figure of 94.9 mil­lion euros. The group EBIT mar­gin thus fell to 10.4 per­cent (prior year: 11.4 per­cent). The EBIT includes the ope­ra­ting result of the acqui­red com­pa­nies of 5.8 mil­lion euros (prior year: minus 0.5 mil­lion euros), inclu­ding impacts ari­sing from the purchase price allo­ca­tion of minus 5.3 mil­lion euros (prior year: minus 10.5 mil­lion euros).

“As we had expec­ted, demand impro­ved across key sec­tions of our busi­ness in the second half-year 2019, allo­wing us to achieve our tar­gets and boost pro­fi­ta­bi­lity. We owe this, in no small part, to the com­mit­ment of our employees. But it also shows that we are well posi­tio­ned in rele­vant mar­kets with our range of pro­ducts and ser­vices. This will allow us to con­ti­nue our company’s suc­cess story,” said Dr. Ste­fan Trae­ger, Pre­si­dent & CEO of JENOPTIK AG.

Order intake increased momen­tum in 2nd half, full year shows decline

The deve­lo­p­ment of order inta­kes in the report­ing year was impac­ted by a reluc­tance to invest within the auto­mo­tive sec­tor. Over­all, the Group recei­ved orders of 812.6 mil­lion euros in 2019 (prior year: 873.7 mil­lion euros). The decline of 7.0 per­cent was also due to a major order in the semi­con­duc­tor equip­ment busi­ness boo­ked alre­ady at the end of 2018. With lar­ger pro­jects, par­ti­cu­larly in its defense and traf­fic safety busi­nesses, the Group’s order intake in the fourth quar­ter came to 237.7 mil­lion euros, a sharp rise on prior quar­ters and a solid basis for sche­du­led growth in 2020. Due to good reve­nue figu­res, par­ti­cu­larly in the fourth quar­ter, the order back­log fell to 466.1 mil­lion euros at the end of the year (31/12/2018: 521.5 mil­lion euros).

In line with expec­ta­ti­ons and as a result of a lower ope­ra­ting cash flow and hig­her capi­tal expen­dit­ure, the Group repor­ted a free cash flow of 77.2 mil­lion euros (prior year: 108.3 mil­lion euros). Cash and cash equi­va­lents, inclu­ding short-term finan­cial invest­ments, grew to 168.7 mil­lion euros (31/12/2018: 148.7 mil­lion euros). Despite a hig­her divi­dend pay­out of 20.0 mil­lion euros (prior year: 17.2 mil­lion euros) and exten­sive invest­ment, Jenoptik’s net debt came to minus 9.1 mil­lion euros at the end of the year, which means the Group was again free of net debt (31/12/2018: minus 27.2 mil­lion euros).

Com­pany is inves­ti­ga­ting fea­si­bi­lity of Annual Gene­ral Mee­ting on the plan­ned date and puts divi­dend pay­ment under review

The com­pany is curr­ently inves­ti­ga­ting poten­tial impacts of the SARS-CoV‑2 out­break on the fea­si­bi­lity of the Annual Gene­ral Mee­ting 2020 on the plan­ned date, and puts the pro­po­sed divi­dend pay­ment under review. “To keep our ope­ra­tio­nal busi­ness pro­ces­ses run­ning, and to con­ti­nue to enable stra­te­gic invest­ments in the future deve­lo­p­ment of our com­pany towards a focu­sed tech­no­logy group in optics and pho­to­nics is the Board’s hig­hest prio­rity at the moment” says Dr. Ste­fan Trae­ger, Pre­si­dent and CEO of JENOPTIK AG. Ori­gi­nally, the Exe­cu­tive and Super­vi­sory Boards had plan­ned to pro­pose a divi­dend of 0.35 euros (prior year: 0.35 euros) to share­hol­ders at the Annual Gene­ral Meeting.

“Based on the deve­lo­p­ments in the coming weeks, the Exe­cu­tive and Super­vi­sory Boards will review the appro­pria­tion of pro­fit and issue an updated pro­po­sal to the Annual Gene­ral Mee­ting, if appro­priate.” adds Hans-Die­ter Schu­ma­cher, Chief Finan­cial Offi­cer of JENOPTIK AG.

Employee num­bers up in line with ope­ra­ting business

The num­ber of Jen­op­tik employees (incl. trai­nees) grew by 1.9 per­cent or 79 employees to 4,122 as of Decem­ber 31, 2019 (31/12/2018: 4,043 employees). In Ger­many, Jen­op­tik recor­ded a rise in its work­force of 2.4 per­cent, to 3,134 employees. The num­ber of peo­ple employed abroad, at 988, was vir­tually unch­an­ged on the prior year (31/12/2018: 981).

Deve­lo­p­ment of the divisions

In the Light & Optics divi­sion, reve­nue grew by 3.9 per­cent to 350.0 mil­lion euros (prior year: 337.0 mil­lion euros). The divi­sion par­ti­cu­larly bene­fi­ted from good busi­ness with solu­ti­ons for the semi­con­duc­tor equip­ment indus­try, allo­wing it to more than off­set the decline in the Indus­trial Solu­ti­ons area. EBITDA showed a year-on-year reduc­tion of 5.8 per­cent to 69.8 mil­lion euros (prior year: 74.1 mil­lion euros). This was due to the decli­ning mar­gin con­tri­bu­tion in the Indus­trial Solu­ti­ons area, mainly the result of a wide­spread reluc­tance to invest within the auto­mo­tive indus­try. This could not be off­set by the good busi­ness with the semi­con­duc­tor equip­ment indus­try or the posi­tive impacts ari­sing from the first-time appli­ca­tion of IFRS 16. At 19.8 per­cent, the EBITDA mar­gin in 2019 was down on the prior-year figure of 21.8 per­cent, but still remained at a very good level. As expec­ted, the year’s order intake, worth 324.7 mil­lion euros, was down on the prior-year figure of 396.1 mil­lion euros, in part due to the fact that a high-volume order for semi­con­duc­tor equip­ment was alre­ady boo­ked in late 2018. Due to the lower order intake, the division’s order back­log fell by 35.7 mil­lion euros to 144.9 mil­lion euros at the end of the year (31/12/2018: 180.6 mil­lion euros).

Reve­nue in the Light & Pro­duc­tion divi­sion grew by 8.6 per­cent to 228.9 mil­lion euros in 2019 (prior year: 210.7 mil­lion euros), with the Auto­ma­tion & Inte­gra­tion area making a signi­fi­cant con­tri­bu­tion to this increase. The com­pa­nies acqui­red in 2018 con­tri­bu­ted 66.4 mil­lion euros of reve­nue (prior year: 37.0 mil­lion euros). By con­trast, the deve­lo­p­ment of the Metro­logy and Laser Pro­ces­sing areas was affec­ted by incre­asingly dif­fi­cult con­di­ti­ons in the auto­mo­tive indus­try, par­ti­cu­larly in the second half of 2019. On the basis of good reve­nue growth and posi­tive impacts ari­sing from the first-time appli­ca­tion of IFRS 16, EBITDA increased by 4.7 per­cent to 25.8 mil­lion euros (prior year: 24.6 mil­lion euros). The EBITDA mar­gin came to 11.3 per­cent, com­pared with 11.7 per­cent in the prior year. The division’s order intake was worth 199.3 mil­lion euros, prac­ti­cally unch­an­ged on the prior-year figure of 200.7 mil­lion euros, with growth seen in the Auto­ma­tion & Inte­gra­tion area. The order intake includes orders from Pro­do­max and the OTTO Group, worth around 46 mil­lion euros (prior year: appro­xi­m­ately 24 mil­lion euros). As a result of the hig­her reve­nue, the order back­log decreased by 27.5 per­cent to 81.6 mil­lion euros at year-end 2019 (31/12/2018: 112.5 mil­lion euros).

In the 2019 fis­cal year, the Light & Safety divi­sion gene­ra­ted reve­nue of 108.7 mil­lion euros (prior year: 116.9 mil­lion euros). In the prior year, the deli­very of toll moni­to­ring sys­tems had retur­ned a strong 26 mil­lion euros of reve­nue. In 2019, Light & Safety mana­ged to lar­gely off­set the short­fall in reve­nue ari­sing from this pro­ject, par­ti­cu­larly assis­ted by a strong fourth quar­ter. Despite the fall in reve­nue, EBITDA clim­bed shar­ply to 18.8 mil­lion euros (prior year: 15.9 mil­lion euros), pri­ma­rily due to impacts ari­sing from the first-time appli­ca­tion of IFRS 16 and a hig­her-mar­gin pro­duct mix. The EBITDA mar­gin impro­ved signi­fi­cantly to 17.3 per­cent in 2019 (prior year: 13.6 per­cent). As expec­ted, the divi­sion increased its order intake in the fourth quar­ter, pos­ting new orders in par­ti­cu­lar from North Ame­rica. At 107.9 mil­lion euros, the order intake for the full year was still down on the prior-year figure of 118.4 mil­lion euros. As of Decem­ber 31, 2019, the order back­log of 69.9 mil­lion euros was at the same good level as the prior year (31/12/2018: 69.5 mil­lion euros).

As expec­ted, VINCORION’s reve­nue remained prac­ti­cally unch­an­ged on the prior year, at 164.8 mil­lion euros (prior year: 166.4 mil­lion euros). Buoyed by the issue of a license in early Octo­ber to export power sup­ply units for the “Patriot” mis­sile defense sys­tem to the United Arab Emi­ra­tes (UAE), VINCORION’s reve­nue in the final quar­ter was signi­fi­cantly hig­her than in the prior quar­ters of the year. EBITDA saw a sharp rise to 24.2 mil­lion euros (prior year: 20.1 mil­lion euros), mainly due to posi­tive impacts ari­sing from the first-time appli­ca­tion of IFRS 16. The EBITDA mar­gin accor­din­gly grew to 14.7 per­cent (prior year: 12.1 per­cent). As expec­ted, VINCORION signi­fi­cantly increased its order intake in the fourth quar­ter. At 177.9 mil­lion euros, the order intake for the full year was up on the prior-year figure of 154.9 mil­lion euros. VINCORION pri­ma­rily recei­ved orders for sys­tems for the Leo­pard 2 tank, the mis­sile defense sys­tem, and in the avia­tion busi­ness. The hig­her order intake also led to growth in the order back­log to 169.7 mil­lion euros as of Decem­ber 31, 2019 (31/12/2018: 158.9 mil­lion euros).

SARS-CoV‑2 out­break makes pre­dic­tions dif­fi­cult, fore­cast is sub­ject to review

At pre­sent, it is not pos­si­ble to relia­bly assess to what ext­ent the spread of coro­na­vi­rus will affect Jenoptik’s busi­ness in the cur­rent fis­cal year. The fore­cast made by the Exe­cu­tive Board in the Annual Report was based on the know­ledge at the time of pre­pa­ring the report (March 10, 2020) resp. at the date of publi­shing the preli­mi­nary figu­res at the begin­ning of Febru­ary, and is, the­r­e­fore, sub­ject to review. In view of the cur­rent situa­tion, the Exe­cu­tive Board is expec­ting noti­ceable impacts at least in the first half of the year.

“Jen­op­tik pro­vi­des its pro­ducts and ser­vices pri­ma­rily for the capi­tal goods mar­ket, which in our opi­nion should be less affec­ted than con­su­mer goods seg­ments. We also fore­see only little impact on the pro­ject busi­ness with public cus­to­mers of the Light & Safety divi­sion and of VINCORION. Our semi­con­duc­tor equip­ment busi­ness is also not much affec­ted at pre­sent. But we see signi­fi­cant impacts, espe­ci­ally in the auto­mo­tive sec­tor, due to lon­ger lead times for pro­jects, post­po­ne­ments and noti­ceable effects in the sup­ply chains,” says Ste­fan Traeger.

The 2019 Annual Report is available on the Jen­op­tik web­site, Inves­tors / Reports and Pre­sen­ta­ti­ons. Images are available for down­load from the Jen­op­tik media library.

Kon­takt

Kat­rin Lauterbach
JENOPTIK AG
Lei­te­rin Kom­mu­ni­ka­tion und Marketing
Tele­fon: +49 3641 65–2255
E‑Mail: moc.kitponej@hcabretual.nirtak

Tho­mas Fritsche
JENOPTIK AG
Head of Inves­tor Relations
Tele­fon: +49 3641 65–2156
E‑Mail: moc.kitponej@ehcstirf.samoht