OC Oerlikon / Key word(s): Quarter Results
Ad hoc announcement pursuant to Art. 53 LR News Release
05-Nov-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.
| Third Quarter 2024 Results | Pfaeffikon Schwyz, Switzerland, November 5, 2024 |
Strong Execution Supports Robust Profitability in Challenging Markets Stable operational Group EBITDA margin attributed to both divisions, driven by strong focus on pricing, cost actions and efficiency, while facing challenging end markets. Group order intake decreased by 4% year-over-year at constant FX, driven by transitory softening of end markets in Surface Solutions. Polymer Processing Solutions orders continued to stabilize in the third quarter year-over-year. Group sales down 5% year-over-year at constant FX due to 2023 order postponements in Polymer Processing Solutions. Surface Solutions delivered stable sales (-1% at constant FX) despite sluggish market conditions. Updating 2024 guidance: Expect operational EBITDA margin of ~16% (previously: 15.5%-16.0%) supported by continued strong execution and despite softening PMIs that impacted sales. Organic sales expected to decrease by high single-digit to low-teens percentage at constant FX (previously: high single-digit percentage decrease). Group Key Figures as of September 30, 2024 (CHF million)1 | | Q3 2024 | Q3 2023 | YoY | 9M 2024 | 9M 2023 | YoY | | Order intake | 538 | 567 | -5.1%2 | 1 832 | 1 905 | -3.8%4 | | Sales | 580 | 623 | -6.9%3 | 1 747 | 2 061 | -15.2%5 | | Operational EBITDA | 98 | 106 | -7.3% | 285 | 344 | -17.2% | | Operational EBITDA margin | 16.9% | 17.0% | -8 bps | 16.3% | 16.7% | -38 bps | | EBITDA | 92 | 95 | -3.1% | 273 | 319 | -14.5% | | EBITDA margin | 15.9% | 15.3% | 62 bps | 15.6% | 15.5% | 13 bps |
1 Due to rounding, some totals may not correspond with the sum of the separate figures. For the reconciliation of operational and reported EBITDA figures, please see earnings presentation. 2 Impact from M&A: +0.0%, foreign exchange (FX): -1.1%, organic: -4.0%. 3 Impact from M&A: +0.0%, FX: -1.8%, organic: -5.2%. 4Impact from M&A: +1.7%, FX: -3.4%, organic: -2.2%. 5 Impact from M&A: +1.3%, FX: -3.0%, organic: -13.5%. Michael Suess, Executive Chairman of Oerlikon, stated: “In the third quarter, we achieved robust profitability, driven by our strong focus on execution quality in challenging end markets. Surface Solutions’ resilience, supported by innovation and diversification started a decade ago, positions us strongly to benefit when markets recover. Polymer Processing Solutions still faces challenges in its end markets, yet succeeded in delivering a strong 13% EBITDA margin, which was well above the levels during the last downcycle. Our pure play strategy implementation is on track. We have initiated actions to merge our headquarters organization with that of Surface Solutions, and these changes will be implemented from January 2025 onwards. In addition, our manmade fibers business will be set-up as an independent organization ready for separation. As we evaluate different options, our goal remains to create maximum value for all stakeholders.” Separation of Oerlikon’s Manmade Fibers Business on Track As announced in February 2024, the planned separation of Oerlikon’s manmade fibers business over 12-36 months and the implementation of Oerlikon’s pure play strategy focusing on surface solutions are well on track. As a next step, the manmade fibers business will be set-up as a largely independent organization ready for the planned separation. In preparation for the separation, Oerlikon is reducing its support functions, as it will no longer require all of the Group’s current resources. Accordingly, streamlining has been initiated, merging headquarters’ functions with those from Surface Solutions. Oerlikon has introduced a retention plan to ensure business continuity and retain talents. The streamlining will result in an agile and lean organization, while allowing Oerlikon to adjust its costs base to reflect the future revenue of the company. Surface Solutions Division with Stable Sales and Improved Profitability Surface Solutions delivered stable sales (-1% year-over-year) at constant exchange rates despite declining end markets. Resilience was supported by continued innovation and a robust performance in general industries, energy and aviation. Order intake decreased by 5% year-over-year at constant exchange rates. This was driven by slowing markets in the third quarter, as indicated by contracting purchasing managers indices (PMIs) worldwide. Operational EBITDA margin improved 45 basis points to 18.0% in Q3, supported by pricing, efficiency and innovation. Key figures as of September 30, 2024 (CHF million)1 | | Q3 2024 | Q3 2023 | YoY | 9M 2024 | 9M 2023 | YoY | | Order intake | 343 | 367 | -6.6%2 | 1 123 | 1 144 | -1.8%4 | | Sales (to third parties) | 356 | 368 | -3.4%3 | 1 120 | 1 130 | -0.9%5 | | Operational EBITDA | 64 | 65 | -0.9% | 203 | 190 | 6.9% | | Operational EBITDA margin | 18.0% | 17.5% | 45 bps | 18.1% | 16.7% | 134 bps | | EBITDA | 63 | 63 | 0% | 199 | 182 | 9.1% | | EBITDA margin | 17.5% | 16.9% | 58 bps | 17.7% | 16.1% | 164 bps |
1Due to rounding, some totals may not correspond with the sum of the separate figures. 2 Impact from M&A: +0.0%, FX: -1.8%, organic: -4.9%. 3 Impact from M&A: +0.0%, FX: -1.9%, organic: -1.4%. 4Impact from M&A: +2.9%, FX: -3.5%, organic: -1.2%. 5 Impact from M&A: +2.4%, FX: -3.5%, organic: +0.3%. Polymer Processing Solutions Division with Stabilizing Orders and Robust Profitability Polymer Processing Solutions order intake continued to stabilize (-2%) year-over-year, while sales at constant currency declined by 11%, reflecting postponement of orders in 2023. The division continued to see positive momentum in small- and mid-sized filament orders. Sluggish industrial production, as indicated in PMIs, impacted the non-filament business, where Q3 orders have decreased to 2016 trough levels. The division achieved a robust operational EBITDA margin of 13.1% despite lower sales volume. The margin was supported by proactive cost actions, counteracting operating leverage and limited pass-through of higher input costs to maintain volume. Key figures as of September 30, 2024 (CHF million)1 | | Q3 2024 | Q3 2023 | YoY | 9M 2024 | 9M 2023 | YoY | | Order intake | 195 | 199 | -2.2%2 | 709 | 760 | -6.8%4 | | Sales (to third parties) | 224 | 255 | -12.1%3 | 627 | 931 | -32.7%5 | | Operational EBITDA | 29 | 35 | -16.7% | 74 | 142 | -47.8% | | Operational EBITDA margin | 13.1% | 13.8% | -73 bps | 11.8% | 15.3% | -345 bps | | EBITDA | 28 | 28 | -0.9% | 72 | 127 | -43.7% | | EBITDA margin | 12.5% | 11.1% | 141 bps | 11.4% | 13.7% | -223 bps |
1 Due to rounding, some totals may not correspond with the sum of the separate figures. 2 Impact from M&A: +0.0%, FX: 0.0%, organic: -2.3%. 3 Impact from M&A: 0.0%, FX: -1.5%, organic: -10.5%. 4Impact from M&A: +0.0%, FX: -3.2%, organic: -3.6%. 5 Impact from M&A: +0.0%, FX: -2.4%, organic: -30.2%. Additional Information To participate in the results’ conference call today at 10:30 CET, please click on this link to join the webcast. To ask questions in the Q&A session, please dial in. | Country | Local toll call numbers | | Switzerland | +41 58 310 50 00 | | UK | +44 207 107 06 13 | | USA | +1 631 570 56 13 |
The media release can be found at www.oerlikon.com/pressreleases and www.oerlikon.com/ir. 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.
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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