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20.02.2024 06:30:53 - dpa-AFX: EQS-Adhoc: Resilient Operational Results in Highly Demanding Environment; Taking Final Step to Become a Pure-Play Surface Solutions Leader Over Next 12-36 Months (english)
Resilient Operational Results in Highly Demanding Environment; Taking Final
Step to Become a Pure-Play Surface Solutions Leader Over Next 12-36 Months
OC Oerlikon / Key word(s): Annual Results/Strategic Company Decision
Resilient Operational Results in Highly Demanding Environment; Taking Final
Step to Become a Pure-Play Surface Solutions Leader Over Next 12-36 Months
20-Feb-2024 / 06:30 CET/CEST
Release of an ad hoc announcement pursuant to Art. 53 LR
The issuer is solely responsible for the content of this announcement.
---------------------------------------------------------------------------
Key Figures of the Oerlikon Group as of December 31, 2023 (in CHF Million)
1 For the reconciliation of operational and unadjusted figures, please see
tables I and II on page 3 of this news release. 2 Operational EBITDA and
operational EBIT were restated for effects from discontinued activities. 3
Operational ROCE, excl. M&A, is 7.7% in 2023 (2022: 10.8%).
Pfaeffikon, Schwyz, Switzerland - February 20, 2024 - "In 2023, we managed
short-term market headwinds and adverse currency effects (CHF -174 million
on 2023 sales) and executed on our strategy," said Michael Suess, Executive
Chairman, Oerlikon. "Our swift and decisive strategic actions, particularly
in Q4, streamlined our existing business and strengthened our foundation for
growth and profitability."
"Today, we announce our final strategic step to become a pure-play leader in
the broad surface solutions markets with attractive organic and inorganic
growth opportunities. We will further leverage our technology leadership to
drive growth and profitability by expanding regionally and into new
applications and end markets," added Suess. "The board and management will
evaluate options for the separation of Polymer Processing Solutions with the
aim of optimizing value for all stakeholders."
Taking the Final Step to Become a Pure-Play Surface Solutions Leader
Oerlikon began executing its strategy in 2014 to become a pure-play Surface
Solutions leader. From five divisions, the Group has streamlined to its
current two divisions. Both divisions occupy "sweet spots" in their
respective markets, delivering leading technologies that act as high
barriers to entry. The synergies between the divisions though are limited.
Oerlikon announces today its intent to take the final step in becoming a
pure-play Surface Solutions leader. Oerlikon will implement this step over
the next 12-36 months as Polymer Processing Solutions' filament cycle
recovers. The Group will look for the best value creative option for Polymer
Processing Solutions, where it can better leverage its distinct brands and
leading technologies in its end markets, which are driven by long-term
growth trends, such as population expansion and increasing demand for
clothing and housing.
With the final step, Oerlikon will become a pure-play leader in the Surface
Solutions' attractive end markets. The division serves a broad base of
customers in diverse industries - from automotive, aerospace and energy to
luxury, medical and semiconductors. Oerlikon will drive profitable growth by
delivering innovative technologies that help customers achieve greater
efficiency and productivity, while using less energy and producing less
waste and fewer emissions. Oerlikon will continue to leverage its core
competencies to grow and expand into Surface Solutions' broad end markets.
This includes exploiting new applications, markets and geographies.
Oerlikon confirms its mid-term target of 4-6% organic sales growth (at
constant FX) for Surface Solutions. Disciplined cost management and the
application of the strengthened capital allocation framework will support
the division to achieve its mid-term operational EBITDA margin target of
20%+.
The Executive Chair Model is required to smoothly execute this final step in
going pure play. With the completion of this step, the Model will be
discontinued.
2023 Results Impacted by Challenging Environment in Polymer Processing
Solutions
Group order intake decreased by 17.8% to CHF 2 457 million. Adjusted for FX
and the Riri acquisition, orders decreased by 16.8%. Group sales decreased
by 7.4% to CHF 2 693 million, including an FX headwind of -6.0% and an
impact of +4.5% from the Riri acquisition. The FX-adjusted organic decline
of 5.9% was driven by the filament downturn in Polymer Processing Solutions,
while Surface Solutions saw an FX-adjusted organic sales growth of +7.0%.
EBITDA and EBIT
Group operational EBITDA decreased by 13.4% to CHF 444 million, versus CHF
513 million in 2022. The operational EBITDA margin was at 16.5% versus 17.6%
in 2022, due to lower sales, higher input costs, adverse currency impact and
unfavorable mix effects. The operational EBIT margin was 8.7% (CHF 235
million) compared with 10.4% (CHF 301 million) in the previous year.
Group unadjusted EBITDA decreased by 8.2% year-over-year to CHF 384 million,
or 14.2% of sales
(2022: CHF 418 million, or 14.4% of sales). Group unadjusted EBIT was CHF
105 million, or 3.9% of sales (2022: CHF 176 million, or 6.0% of sales).
Oerlikon has strategically realigned its additive manufacturing (AM)
business, consolidating production and focusing the business in the U.S. to
take advantage of the U.S. as the largest growth market for AM.
To strengthen the division's resilience, Surface Solutions is optimizing its
coating centers footprint in Germany and discontinuing its U.S. thermal
spray coating services. In Polymer Processing Solutions, the Teknoweb
business was discontinued, and its intralogistics offering was divested.
These actions led to one-off charges, largely non-cash, which were included
in the Q4 results. Operational EBIT and EBITDA for 2023 and 2022 were
adjusted to exclude these activities.
The reconciliation of the operational and unadjusted figures can be seen in
the tables below.
Table I: Reconciliation of Q4 2023 and FY 2023 Operational EBITDA and EBITDA1
Table II: Reconciliation of Q4 2023 and FY 2023 Operational EBIT and EBIT1
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. 2 Includes provisions for personnel
expenses, primarily aimed at reducing costs in the divisions. 3 Includes
costs from discontinued businesses, thus 2023 and 2022 numbers have been
restated accordingly.
The Group's net result was impacted by the downturn in Polymer Processing
Solutions and the previously mentioned cost actions. It amounted to CHF 23
million in 2023, compared with CHF 93 million in 2022. Earnings per share in
2023 stood at CHF 0.10 (CHF 0.27 in 2022).
As of December 31, 2023, Oerlikon had net debt of CHF 1 151 million,
corresponding to a net debt/operational EBITDA ratio of 2.6. This represents
an increase compared to the ratio of 0.9 as of year-end of 2022 and was
mainly driven by the acquisition of Riri and the downturn in Polymer
Processing Solutions impacting EBITDA and net working capital. Oerlikon's
total equity ratio was 25% as at the end of 2023.
Continued Commitment to Sustainable R&D
In 2023, Oerlikon filed 78 patents and continued to invest in innovation,
spending 3.8% (CHF 103 million) of 2023 Group sales on R&D to develop new,
improved and sustainable technologies designed to meet customer needs and
demands.
Q4 2023 Performance
Order intake for the fourth quarter decreased by 16.7%, including an FX
impact of -5.5% and a positive impact from the Riri acquisition of 5.0%.
Group sales decreased by 14.0% to CHF 633 million. This includes an FX
headwind of 5.5% and a positive effect from the Riri acquisition of 4.2%.
The organic FX-adjusted sales decline of 12.7% was driven by the filament
downturn in Polymer Processing Solutions, while Surface Solutions posted a
solid FX-adjusted organic sales growth of 7.6%.
Group operational EBITDA decreased by 21.0% in Q4 2023 to CHF 100 million,
or 15.8% of sales (Q4 2022: CHF 127 million, or 17.2% of sales). The
operational EBITDA margin was impacted by the strong decline in sales in
Polymer Processing Solutions, while Surface Solutions achieved a slight
margin improvement. Group operational EBIT for Q4 2023 was CHF 47 million,
or 7.5% of sales (Q4 2022: CHF 72 million, or 9.7% of sales).
Group Q4 2023 unadjusted EBITDA amounted to CHF 64 million, or 10.2% of
sales (2022: CHF 55 million, or 7.5% of sales), and unadjusted EBIT was CHF
-49 million, or -7.8% of sales (2022: CHF -22 million, or -3.0% of sales).
The decrease was mainly attributable to the one-off costs and impairments
booked in the fourth quarter.
Dividend of CHF 0.20 per Share In-Line with Policy
As per past years, Oerlikon's dividend payout is in line with its dividend
policy and can be based on up to 50% of the Group's underlying net result
and beyond, after considering the Group's financial position and
affordability from the balance sheet. Thus, the Board will recommend to
shareholders an ordinary dividend payout of CHF 0.20 per share at the AGM on
March 21, 2024, taking place at ENTRA, Rapperswil-Jona, Switzerland.
Oerlikon's dividend policy will be reevaluated upon completion of pure-play
execution.
2024 Outlook
For 2024, Oerlikon expects a high single-digit percentage decrease in
FX-adjusted organic sales, and an operational EBITDA margin of 15.0-15.5%.
Oerlikon anticipates growth in Surface Solutions to be offset by the
downturn in Polymer Processing Solutions.
Division Overview
Surface Solutions Division
Key Figures of the Surface Solutions Division as of December 31, 2023 (in
CHF Million)
1 Operational EBITDA and operational EBIT were restated for effects from
newly discontinued activities.
Surface Solutions improved orders and sales, despite facing contracting
manufacturing PMIs. The division's 2023 order intake increased by 6.8% to
CHF 1 514 million (including an FX effect of -6.4%, an impact from the Riri
acquisition of +8.9% and organic growth of 4.3%). In Q4 2023, order intake
increased by 6.4% year-over-year (incl. an FX effect of -6.8%, an impact
from the Riri acquisition of +9.5% and organic growth of 3.7%). Division
sales of CHF 1 521 million in 2023 were 9.9% higher than in the previous
year and includes an FX effect of -6.5%, an impact from the Riri acquisition
of +9.4% and organic growth of 7.0%. In Q4 2023, sales increased 9.3%
(including an FX effect of -6.9%, impact of +8.6% from the Riri acquisition
and organic growth of 7.6%), supported by equipment sales and higher demand
in the energy and automotive sectors.
To take advantage of the U.S. as the largest growth market for additive
manufacturing (AM), the division is strategically realigning its business
for this new technology. It is focusing its AM production in Huntersville,
North Carolina, bringing the business closer to the U.S. growth sectors,
such as semiconductor, and also enabling the business to benefit from the
more conducive U.S. framework conditions and higher market acceptance for
disruptive technologies.
To strengthen its resilience, operational actions were taken in 2023. The
division is optimizing its footprint in Germany for surface coatings and
discontinuing its U.S. thermal spray coating services. Operational EBITDA
for 2023 improved by 4.2% to CHF 262 million, or 17.1% of sales. The margin
was impacted by higher input costs, the strengthening Swiss franc and an
unfavorable mix. Operational EBITDA for Q4 2023 increased by 10.7%
year-over-year, and the margin improved by 20 basis points to 18.2%. The
margin improvement was supported by pricing measures and positive operating
leverage, counteracting the higher input costs, an unfavorable mix and the
strong Swiss franc. Operational EBIT for 2023 amounted to CHF 117 million,
or 7.7% of sales in 2023 (2022: CHF 104 million, or 7.5% of sales).
Unadjusted EBITDA was CHF 230 million, or 15.1% of sales, compared with CHF
226 million, or 16.2% of sales in 2022. Unadjusted EBIT was CHF 51 million,
or 3.3% of sales (2022: CHF 54 million, or 3.9% of sales), attributable to
one-off costs and impairments related to the operational actions.
Polymer Processing Solutions Division
Key Figures of the Polymer Processing Solutions Division as of December 31,
2023 (in CHF Million)
1 Operational EBITDA and operational EBIT were restated for effects from
newly discontinued activities.
The division faced highly challenging filament and non-filament markets in
2023. Order intake decreased by 40.1% (35.9% FX-adjusted) to CHF 943 million
year-over-year, including -42.2% (-38.2% FX adjusted) in Q4 2023. Sales
declined by 23.1% (17.7% FX-adjusted) to CHF 1 172 million, including -36.1%
(-31.9% FX-adjusted) in Q4 2023. The division's results were driven by the
cyclical downturn in filament, as a result of the slowdown in consumption,
production and investment in China. Furthermore, the division was impacted
by weakness in the global nonwoven market and in the Oerlikon HRSflow
market, the latter due to transitorily decline in car launches.
Toward the end of 2023, the division noted an initial return in demand for
carpet yarn (BCF) plants from the automotive and nylon industries and first
signs of recovery for Oerlikon HRSflow solutions.
In Q4 2023, the division discontinued its Teknoweb business and divested its
intralogistics offering for large spinning mills (Oerlikon Barmag
Automation) to Irico Gualchierani Handling S.r.l. This will structurally
strengthen the division's profitability in line with Oerlikon's capital
allocation framework.
Operational EBITDA for 2023 amounted to CHF 170 million, or 14.5% of sales,
attributable to the decrease in sales. Operational EBITDA margin for Q4 2023
decreased from 15.6% to 11.2% year-over-year, due to lower sales and limited
pass-through of higher input costs to maintain volume. Operational EBIT for
2023 was CHF 122 million, or 10.4% of sales (2022: CHF 203 million, or 13.3%
of sales).
Since the end of 2022, the division has been taking measures to mitigate
impacts from the cyclical downturn. The division has started to see initial
positive effects from these measures in the final quarter of 2023 and is
expecting that these measures will further support the margin in 2024.
Unadjusted EBITDA amounted to CHF 143 million, or 12.2% of sales (2022: CHF
193 million, or 12.6% of sales). Unadjusted EBIT was CHF 61 million, or 5.2%
of sales (2022: CHF 135 million, or 8.9% of sales). Both were impacted by
the decline in sales and non-recurring expenses in conjunction with the
discontinuation/divestment of Teknoweb and the intralogistics business.
Additional Information
FY2023 Results Conferences
Oerlikon will present its results today, February 20, 2024, as follows:
Live Webcast for Analysts and Investors
The analysts and investors conference will also be broadcast live via
webcast and can be viewed via this link on the Group's website (
www.oerlikon.com).
To ask questions, please dial in using one of these numbers:
FY2023 Documents can be downloaded from Oerlikon's website:
The recording of the analyst and investor conference will be available from
February 21, 2024, onward at
www.oerlikon.com/en/investors/reports-publications.
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,
empower customers by improving and maximizing the performance, function,
design and sustainability of 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 12 600
employees at 207 locations in 38 countries and generated sales of CHF 2.7
billion in 2023.
For further information, please contact:
Disclaimer
OC Oerlikon Corporation AG, Pfäffikon 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.
The contents of this document, including all statements made therein, are
based on estimates, assumptions and other information currently available to
the management of Oerlikon. This document contains certain statements
related to the future business and financial performance or future events
involving Oerlikon that may constitute forward-looking statements. The
forward-looking statements contained herein could be substantially impacted
by risks, influences and other factors, many of which are not foreseeable at
present and/or are beyond Oerlikon's control, so that the actual results,
including Oerlikon's financial results and operational results, may vary
materially from and differ from those, expressly or implicitly, provided in
the forward-looking statements, be they anticipated, expected or projected.
Oerlikon does not give any assurance, representation or warranty, expressed
or implied, that such forward-looking statements will be realized. Oerlikon
is under no obligation to, and explicitly disclaims any obligation to,
update or otherwise review its forward-looking statements, whether as a
result of new information, future events or otherwise.
This document, including any and all information contained therein, is not
intended as, and may not be construed as, an offer or solicitation by
Oerlikon for the purchase or disposal of, trading or any transaction in any
Oerlikon securities. Investors must not rely on this information for
investment decisions and are solely responsible for forming their own
investment decisions.
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End of Inside Information
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End of Announcement EQS News Service
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1840505 20-Feb-2024 CET/CEST
Step to Become a Pure-Play Surface Solutions Leader Over Next 12-36 Months
OC Oerlikon / Key word(s): Annual Results/Strategic Company Decision
Resilient Operational Results in Highly Demanding Environment; Taking Final
Step to Become a Pure-Play Surface Solutions Leader Over Next 12-36 Months
20-Feb-2024 / 06:30 CET/CEST
Release of an ad hoc announcement pursuant to Art. 53 LR
The issuer is solely responsible for the content of this announcement.
---------------------------------------------------------------------------
* 2023 Group orders, sales and EBITDA impacted by Polymer Processing
Solutions downturn. Strong performance in Surface Solutions with 7%
organic sales growth at constant FX and sequentially improved
profitability throughout 2023.
* Oerlikon took substantial actions in Q4 to secure future growth and
improved profitability; one-off charges, primarily non-cash, included in
Q4 results.
* Taking final strategic step to become a pure-play global market leader
in surface solutions within next 12-36 months. Executive Chair Model to
discontinue upon completion of this step.
* Board to propose an ordinary dividend of CHF 0.20 per share in line with
dividend policy.
* 2024 outlook: Expecting high single-digit percentage decrease in
FX-adjusted organic sales and operational EBITDA margin of 15.0-15.5%.
Anticipate growth in Surface Solutions to be offset by Polymer
Processing Solutions.
Key Figures of the Oerlikon Group as of December 31, 2023 (in CHF Million)
FY FY Q4 Q4
2023 2022 2023 2022
Order intake 2 457 2 990 -17.8% 552 663 -16.7%
Sales 2 693 2 909 -7.4% 633 736 -14.0%
Operational EBITDA1 444 5132 -13.4% 100 1272 -21.0%
Operational EBITDA 16.5% 17.6%2 -110 15.8% 17.22 -140
margin1 bps bps
Operational EBIT1 235 3012 -21.9% 47 722 -34.0%
Operational EBIT 8.7% 10.4%2 -170 7.5% 9.7%2 -220
margin1 bps bps
Net result 23 93 -74.9% - - -
ROCE 2.7%3 5.3% - - - -
1 For the reconciliation of operational and unadjusted figures, please see
tables I and II on page 3 of this news release. 2 Operational EBITDA and
operational EBIT were restated for effects from discontinued activities. 3
Operational ROCE, excl. M&A, is 7.7% in 2023 (2022: 10.8%).
Pfaeffikon, Schwyz, Switzerland - February 20, 2024 - "In 2023, we managed
short-term market headwinds and adverse currency effects (CHF -174 million
on 2023 sales) and executed on our strategy," said Michael Suess, Executive
Chairman, Oerlikon. "Our swift and decisive strategic actions, particularly
in Q4, streamlined our existing business and strengthened our foundation for
growth and profitability."
"Today, we announce our final strategic step to become a pure-play leader in
the broad surface solutions markets with attractive organic and inorganic
growth opportunities. We will further leverage our technology leadership to
drive growth and profitability by expanding regionally and into new
applications and end markets," added Suess. "The board and management will
evaluate options for the separation of Polymer Processing Solutions with the
aim of optimizing value for all stakeholders."
Taking the Final Step to Become a Pure-Play Surface Solutions Leader
Oerlikon began executing its strategy in 2014 to become a pure-play Surface
Solutions leader. From five divisions, the Group has streamlined to its
current two divisions. Both divisions occupy "sweet spots" in their
respective markets, delivering leading technologies that act as high
barriers to entry. The synergies between the divisions though are limited.
Oerlikon announces today its intent to take the final step in becoming a
pure-play Surface Solutions leader. Oerlikon will implement this step over
the next 12-36 months as Polymer Processing Solutions' filament cycle
recovers. The Group will look for the best value creative option for Polymer
Processing Solutions, where it can better leverage its distinct brands and
leading technologies in its end markets, which are driven by long-term
growth trends, such as population expansion and increasing demand for
clothing and housing.
With the final step, Oerlikon will become a pure-play leader in the Surface
Solutions' attractive end markets. The division serves a broad base of
customers in diverse industries - from automotive, aerospace and energy to
luxury, medical and semiconductors. Oerlikon will drive profitable growth by
delivering innovative technologies that help customers achieve greater
efficiency and productivity, while using less energy and producing less
waste and fewer emissions. Oerlikon will continue to leverage its core
competencies to grow and expand into Surface Solutions' broad end markets.
This includes exploiting new applications, markets and geographies.
Oerlikon confirms its mid-term target of 4-6% organic sales growth (at
constant FX) for Surface Solutions. Disciplined cost management and the
application of the strengthened capital allocation framework will support
the division to achieve its mid-term operational EBITDA margin target of
20%+.
The Executive Chair Model is required to smoothly execute this final step in
going pure play. With the completion of this step, the Model will be
discontinued.
2023 Results Impacted by Challenging Environment in Polymer Processing
Solutions
Group order intake decreased by 17.8% to CHF 2 457 million. Adjusted for FX
and the Riri acquisition, orders decreased by 16.8%. Group sales decreased
by 7.4% to CHF 2 693 million, including an FX headwind of -6.0% and an
impact of +4.5% from the Riri acquisition. The FX-adjusted organic decline
of 5.9% was driven by the filament downturn in Polymer Processing Solutions,
while Surface Solutions saw an FX-adjusted organic sales growth of +7.0%.
EBITDA and EBIT
Group operational EBITDA decreased by 13.4% to CHF 444 million, versus CHF
513 million in 2022. The operational EBITDA margin was at 16.5% versus 17.6%
in 2022, due to lower sales, higher input costs, adverse currency impact and
unfavorable mix effects. The operational EBIT margin was 8.7% (CHF 235
million) compared with 10.4% (CHF 301 million) in the previous year.
Group unadjusted EBITDA decreased by 8.2% year-over-year to CHF 384 million,
or 14.2% of sales
(2022: CHF 418 million, or 14.4% of sales). Group unadjusted EBIT was CHF
105 million, or 3.9% of sales (2022: CHF 176 million, or 6.0% of sales).
Oerlikon has strategically realigned its additive manufacturing (AM)
business, consolidating production and focusing the business in the U.S. to
take advantage of the U.S. as the largest growth market for AM.
To strengthen the division's resilience, Surface Solutions is optimizing its
coating centers footprint in Germany and discontinuing its U.S. thermal
spray coating services. In Polymer Processing Solutions, the Teknoweb
business was discontinued, and its intralogistics offering was divested.
These actions led to one-off charges, largely non-cash, which were included
in the Q4 results. Operational EBIT and EBITDA for 2023 and 2022 were
adjusted to exclude these activities.
The reconciliation of the operational and unadjusted figures can be seen in
the tables below.
Table I: Reconciliation of Q4 2023 and FY 2023 Operational EBITDA and EBITDA1
In CHF million Q4 Q4 FY FY
2023 2022 2023 2022
Operational EBITDA 100 127 444 513
Expenses/income from restructuring2 1 -53 1 -54
Expenses related to discontinued -36 -15 -58 -32
activities3
Expenses related to acquisition and -1 -3 -3 -9
integration costs
EBITDA 64 55 384 418
Table II: Reconciliation of Q4 2023 and FY 2023 Operational EBIT and EBIT1
In CHF million Q4 Q4 FY FY
2023 2022 2023 2022
Operational EBIT 47 72 235 301
Expenses/income from restructuring2 1 -53 1 -54
Impairment charges -14 0 -14 0
Expenses related to discontinued -83 -37 -114 -63
activities3
Expenses related to acquisition and -1 -3 -3 -9
integration costs
EBIT -49 -22 105 176
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. 2 Includes provisions for personnel
expenses, primarily aimed at reducing costs in the divisions. 3 Includes
costs from discontinued businesses, thus 2023 and 2022 numbers have been
restated accordingly.
The Group's net result was impacted by the downturn in Polymer Processing
Solutions and the previously mentioned cost actions. It amounted to CHF 23
million in 2023, compared with CHF 93 million in 2022. Earnings per share in
2023 stood at CHF 0.10 (CHF 0.27 in 2022).
As of December 31, 2023, Oerlikon had net debt of CHF 1 151 million,
corresponding to a net debt/operational EBITDA ratio of 2.6. This represents
an increase compared to the ratio of 0.9 as of year-end of 2022 and was
mainly driven by the acquisition of Riri and the downturn in Polymer
Processing Solutions impacting EBITDA and net working capital. Oerlikon's
total equity ratio was 25% as at the end of 2023.
Continued Commitment to Sustainable R&D
In 2023, Oerlikon filed 78 patents and continued to invest in innovation,
spending 3.8% (CHF 103 million) of 2023 Group sales on R&D to develop new,
improved and sustainable technologies designed to meet customer needs and
demands.
Q4 2023 Performance
Order intake for the fourth quarter decreased by 16.7%, including an FX
impact of -5.5% and a positive impact from the Riri acquisition of 5.0%.
Group sales decreased by 14.0% to CHF 633 million. This includes an FX
headwind of 5.5% and a positive effect from the Riri acquisition of 4.2%.
The organic FX-adjusted sales decline of 12.7% was driven by the filament
downturn in Polymer Processing Solutions, while Surface Solutions posted a
solid FX-adjusted organic sales growth of 7.6%.
Group operational EBITDA decreased by 21.0% in Q4 2023 to CHF 100 million,
or 15.8% of sales (Q4 2022: CHF 127 million, or 17.2% of sales). The
operational EBITDA margin was impacted by the strong decline in sales in
Polymer Processing Solutions, while Surface Solutions achieved a slight
margin improvement. Group operational EBIT for Q4 2023 was CHF 47 million,
or 7.5% of sales (Q4 2022: CHF 72 million, or 9.7% of sales).
Group Q4 2023 unadjusted EBITDA amounted to CHF 64 million, or 10.2% of
sales (2022: CHF 55 million, or 7.5% of sales), and unadjusted EBIT was CHF
-49 million, or -7.8% of sales (2022: CHF -22 million, or -3.0% of sales).
The decrease was mainly attributable to the one-off costs and impairments
booked in the fourth quarter.
Dividend of CHF 0.20 per Share In-Line with Policy
As per past years, Oerlikon's dividend payout is in line with its dividend
policy and can be based on up to 50% of the Group's underlying net result
and beyond, after considering the Group's financial position and
affordability from the balance sheet. Thus, the Board will recommend to
shareholders an ordinary dividend payout of CHF 0.20 per share at the AGM on
March 21, 2024, taking place at ENTRA, Rapperswil-Jona, Switzerland.
Oerlikon's dividend policy will be reevaluated upon completion of pure-play
execution.
2024 Outlook
For 2024, Oerlikon expects a high single-digit percentage decrease in
FX-adjusted organic sales, and an operational EBITDA margin of 15.0-15.5%.
Oerlikon anticipates growth in Surface Solutions to be offset by the
downturn in Polymer Processing Solutions.
Division Overview
Surface Solutions Division
Key Figures of the Surface Solutions Division as of December 31, 2023 (in
CHF Million)
FY FY Q4 Q4
2023 2022 2023 2022
Order intake 1 514 1 418 6.8% 370 348 6.4%
Sales (to third parties) 1 521 1 384 9.9% 391 358 9.3%
Operational EBITDA1 262 251 4.2% 72 65 10.7%
Operational EBITDA 17.1% 18.0% -90 18.2% 18.0% 20
margin1 bps bps
1 Operational EBITDA and operational EBIT were restated for effects from
newly discontinued activities.
Surface Solutions improved orders and sales, despite facing contracting
manufacturing PMIs. The division's 2023 order intake increased by 6.8% to
CHF 1 514 million (including an FX effect of -6.4%, an impact from the Riri
acquisition of +8.9% and organic growth of 4.3%). In Q4 2023, order intake
increased by 6.4% year-over-year (incl. an FX effect of -6.8%, an impact
from the Riri acquisition of +9.5% and organic growth of 3.7%). Division
sales of CHF 1 521 million in 2023 were 9.9% higher than in the previous
year and includes an FX effect of -6.5%, an impact from the Riri acquisition
of +9.4% and organic growth of 7.0%. In Q4 2023, sales increased 9.3%
(including an FX effect of -6.9%, impact of +8.6% from the Riri acquisition
and organic growth of 7.6%), supported by equipment sales and higher demand
in the energy and automotive sectors.
To take advantage of the U.S. as the largest growth market for additive
manufacturing (AM), the division is strategically realigning its business
for this new technology. It is focusing its AM production in Huntersville,
North Carolina, bringing the business closer to the U.S. growth sectors,
such as semiconductor, and also enabling the business to benefit from the
more conducive U.S. framework conditions and higher market acceptance for
disruptive technologies.
To strengthen its resilience, operational actions were taken in 2023. The
division is optimizing its footprint in Germany for surface coatings and
discontinuing its U.S. thermal spray coating services. Operational EBITDA
for 2023 improved by 4.2% to CHF 262 million, or 17.1% of sales. The margin
was impacted by higher input costs, the strengthening Swiss franc and an
unfavorable mix. Operational EBITDA for Q4 2023 increased by 10.7%
year-over-year, and the margin improved by 20 basis points to 18.2%. The
margin improvement was supported by pricing measures and positive operating
leverage, counteracting the higher input costs, an unfavorable mix and the
strong Swiss franc. Operational EBIT for 2023 amounted to CHF 117 million,
or 7.7% of sales in 2023 (2022: CHF 104 million, or 7.5% of sales).
Unadjusted EBITDA was CHF 230 million, or 15.1% of sales, compared with CHF
226 million, or 16.2% of sales in 2022. Unadjusted EBIT was CHF 51 million,
or 3.3% of sales (2022: CHF 54 million, or 3.9% of sales), attributable to
one-off costs and impairments related to the operational actions.
Polymer Processing Solutions Division
Key Figures of the Polymer Processing Solutions Division as of December 31,
2023 (in CHF Million)
FY FY Q4 Q4
2023 2022 2023 2022
Order intake 943 1 572 -40.1% 182 315 -42.2%
Sales (to third 1 172 1 525 -23.1% 241 378 -36.1%
parties)
Operational EBITDA1 170 254 -33.2% 27 59 -53.8%
Operational EBITDA 14.5% 16.6% -210 11.2% 15.6% -440
margin1 bps bps
1 Operational EBITDA and operational EBIT were restated for effects from
newly discontinued activities.
The division faced highly challenging filament and non-filament markets in
2023. Order intake decreased by 40.1% (35.9% FX-adjusted) to CHF 943 million
year-over-year, including -42.2% (-38.2% FX adjusted) in Q4 2023. Sales
declined by 23.1% (17.7% FX-adjusted) to CHF 1 172 million, including -36.1%
(-31.9% FX-adjusted) in Q4 2023. The division's results were driven by the
cyclical downturn in filament, as a result of the slowdown in consumption,
production and investment in China. Furthermore, the division was impacted
by weakness in the global nonwoven market and in the Oerlikon HRSflow
market, the latter due to transitorily decline in car launches.
Toward the end of 2023, the division noted an initial return in demand for
carpet yarn (BCF) plants from the automotive and nylon industries and first
signs of recovery for Oerlikon HRSflow solutions.
In Q4 2023, the division discontinued its Teknoweb business and divested its
intralogistics offering for large spinning mills (Oerlikon Barmag
Automation) to Irico Gualchierani Handling S.r.l. This will structurally
strengthen the division's profitability in line with Oerlikon's capital
allocation framework.
Operational EBITDA for 2023 amounted to CHF 170 million, or 14.5% of sales,
attributable to the decrease in sales. Operational EBITDA margin for Q4 2023
decreased from 15.6% to 11.2% year-over-year, due to lower sales and limited
pass-through of higher input costs to maintain volume. Operational EBIT for
2023 was CHF 122 million, or 10.4% of sales (2022: CHF 203 million, or 13.3%
of sales).
Since the end of 2022, the division has been taking measures to mitigate
impacts from the cyclical downturn. The division has started to see initial
positive effects from these measures in the final quarter of 2023 and is
expecting that these measures will further support the margin in 2024.
Unadjusted EBITDA amounted to CHF 143 million, or 12.2% of sales (2022: CHF
193 million, or 12.6% of sales). Unadjusted EBIT was CHF 61 million, or 5.2%
of sales (2022: CHF 135 million, or 8.9% of sales). Both were impacted by
the decline in sales and non-recurring expenses in conjunction with the
discontinuation/divestment of Teknoweb and the intralogistics business.
Additional Information
FY2023 Results Conferences
Oerlikon will present its results today, February 20, 2024, as follows:
09:30 In-person Media Information Zunfthaus zur Saffran
CET Session
13:30 Hybrid Analysts and Investors Zunfthaus zur Saffran and
CET Conference live webcast
Live Webcast for Analysts and Investors
The analysts and investors conference will also be broadcast live via
webcast and can be viewed via this link on the Group's website (
www.oerlikon.com).
To ask questions, please dial in using one of these numbers:
Switzerland/Eur- +41 58 310 50 00 ope United Kingdom +44 207 107 06 13 United States +1 631 570 56 13 Other Please click (1)here 1. international https://services3.choruscall.ch/NUMBERS/Attended_Dia- numbers l_In_Numbers.pdf
FY2023 Documents can be downloaded from Oerlikon's website:
Annual Report (1)www.oerlikon.com/annualreport-2023 1.
2023 (in http://www.oerlikon.com/annualreport-2023
English)
Sustainability (1)oerlikon.com/sustainabilityreport-2023 1.
Report 2023 https://oerlikon.com/sustainabilityreport-2023
(in English)
2023 FY (1)www.oerlikon.com/pressreleases 1.
Results News https://www.oerlikon.com/en/company/media/press-relea
Release ses/?tab=adhoc
2023 Results (1)www.oerlikon.com/en/investors/reports-publications
Presentation 1.
http://www.oerlikon.com/en/investors/reports-publicat
ions
The recording of the analyst and investor conference will be available from
February 21, 2024, onward at
www.oerlikon.com/en/investors/reports-publications.
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,
empower customers by improving and maximizing the performance, function,
design and sustainability of 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 12 600
employees at 207 locations in 38 countries and generated sales of CHF 2.7
billion in 2023.
For further information, please contact:
Thomas Schmidt Head of Group Stephan Gick Head of Investor
Communications Tel.: +41 58 360 96 Relations Tel: +41 58 360 98 50
60 (1)thomas.schmidt@oerlikon.com (1)stephan.gick@oerlikon.com
(2)www.oerlikon.com 1. (2)www.oerlikon.com 1.
mailto:thomas.schmidt@oerlikon.com mailto:stephan.gick@oerlikon.com
2. http://www.oerlikon.com 2. http://www.oerlikon.com
Leng Wong
Head of Group External Communications
& Public Affairs
Tel.: +41 58 360 96 14
(1)leng.wong@oerlikon.com
(2)www.oerlikon.com
1. mailto:leng.wong@oerlikon.com
2. http://www.oerlikon.com
Disclaimer
OC Oerlikon Corporation AG, Pfäffikon 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.
The contents of this document, including all statements made therein, are
based on estimates, assumptions and other information currently available to
the management of Oerlikon. This document contains certain statements
related to the future business and financial performance or future events
involving Oerlikon that may constitute forward-looking statements. The
forward-looking statements contained herein could be substantially impacted
by risks, influences and other factors, many of which are not foreseeable at
present and/or are beyond Oerlikon's control, so that the actual results,
including Oerlikon's financial results and operational results, may vary
materially from and differ from those, expressly or implicitly, provided in
the forward-looking statements, be they anticipated, expected or projected.
Oerlikon does not give any assurance, representation or warranty, expressed
or implied, that such forward-looking statements will be realized. Oerlikon
is under no obligation to, and explicitly disclaims any obligation to,
update or otherwise review its forward-looking statements, whether as a
result of new information, future events or otherwise.
This document, including any and all information contained therein, is not
intended as, and may not be construed as, an offer or solicitation by
Oerlikon for the purchase or disposal of, trading or any transaction in any
Oerlikon securities. Investors must not rely on this information for
investment decisions and are solely responsible for forming their own
investment decisions.
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End of Inside Information
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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: 1840505
End of Announcement EQS News Service
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1840505 20-Feb-2024 CET/CEST
