Komax Group mastering challenging market situation

KOMAX Holding AG / Key word(s): Forecast
Komax Group mastering challenging market situation

18-Jun-2024 / 07:00 CET/CEST
Release of an ad hoc announcement pursuant to Art. 53 LR
The issuer is solely responsible for the content of this announcement.

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Dierikon, 18 June 2024

Media release
Ad hoc announcement pursuant to Art. 53 LR

The Komax Group currently finds itself in a market environment shaped by
uncertainties and excess capacity in some places, which is why its customers
are investing less and postponing projects. As a consequence, it is
witnessing a significant decline in its revenues. The Komax Group already
started to reduce costs at the end of 2023 and continues to focus
intensively on optimizing the structures that arose through the combination
with Schleuniger. It expects to see a slight improvement in the market
situation in the second half of 2024.

With the automotive industry beset by a number of uncertainties, the Komax
Group has been facing a subdued order intake since the end of 2023. In
Europe and Asia in particular, customers are showing a certain reluctance
when it comes to taking investment decisions, given excess capacities and
the strained economic situation. One exception here is the market
development in India, which has been very positive this year to date.
Although the Komax Group is seeing signs that the overall situation will
improve slightly in the second half of 2024, visibility in terms of how
business will develop is still low.

The Komax Group entered fiscal 2024 with a solid order backlog (CHF 208.2
million). Over the first few months of the year, this allowed it to absorb
some of the drop in order activity, but this is now no longer possible.
Order intake and revenues were both down 20% on the previous year in the
first five months of 2024. The Komax Group anticipates that the decline in
revenues will remain at this level for full-year 2024. Revenues amounted to
CHF 752.0 million in 2023.

This decline in revenues is due in large part to lower levels of volume
business, which accounts for a disproportionately large share of operating
profit (EBIT). Customers continue to have low levels of automation, leaving
plenty of potential for the Komax Group to increase these levels. This is
why the decline in orders for products that play a part in this increase of
automation is noticeably smaller. Even though various projects have been
pushed back this year, customers remain willing to invest in such products.
Overall, the Komax Group expects EBIT to be modestly positive for fiscal
2024.

Cost reduction and structural optimizations

In order to align with the volatile market situation, the Komax Group
started to bring down costs early on. This is achieved, for example, by
reducing its headcount - by not replacing staff when they leave and through
minor active downsizing measures. In addition, it has continued to
streamline its product portfolio and optimize its distribution and
organizational structures. Part of this involved the discontinuation of
production at Komax Testing Bulgaria at the end of April 2024, alongside the
ongoing closure process at the site in Jettingen, Germany.

As well as optimizing structures, the Komax Group is focusing on
strengthening its position in the growing Chinese market. Consequently, it
will acquire a 56% stake in the Chinese firm Hosver effective 1 July 2024.
Hosver is the leading manufacturer in China of machines for processing
high-voltage cables, which are required in vehicles with electric drive
systems.

The Komax Group is convinced that, with the measures it has undertaken, it
will emerge strengthened from the current phase of weakness. To help it get
through this phase, short-time working was introduced for production staff
in Dierikon, Switzerland, in May 2024. Subject to approval from the cantonal
authorities, this will be extended to the entire site as of 1 July 2024 and
the site in Cham, Switzerland, will likewise introduce short-time working.

     Financial calendar
     Half-year results 2024                            13 August 2024
     Investor Day                                      22 November 2024
     Preliminary information on 2024 financial year    21 January 2025

Contact
Roger Müller
Vice President Investor Relations / Corporate Communications
Phone +41 41 455 06 16
roger.mueller@komaxgroup.com

Komax is a globally active technology company that focuses on markets in the
automation sector. As a leading manufacturer of innovative and high-quality
solutions for the wire processing industry, the Komax Group helps its
customers implement economical and safe manufacturing processes, especially
in the automotive supply sector. The Komax Group employs more than 3400
employees worldwide and provides sales and service support via subsidiaries
and independent agents in more than 60 countries.

Komax Stories
Topics and insights from the world of automated wire processing:
https://www.komaxgroup.com/en/stories

Komax Holding AG, Industriestrasse 6, 6036 Dierikon, Switzerland
Phone +41 41 455 04 55, komaxgroup.com


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End of Inside Information

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   Language:       English
   Company:        KOMAX Holding AG
                   Industriestrasse 6
                   6036 Dierikon
                   Switzerland
   ISIN:           CH0010702154
   Valor:          907324
   Listed:         SIX Swiss Exchange
   EQS News ID:    1927033

End of Announcement EQS News Service
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1927033 18-Jun-2024 CET/CEST