Austrian semiconductor manufacturer AT&S announced it made €1 billion ($1.08 billion) in the fiscal year ending March 31. Though the firm’s full-year sales fell by 2.7 percent, it managed to keep its gross income stable despite headwinds from various adverse geopolitical events.
Furthermore, the IC substrate producer declined to offer guidance for the current fiscal year due to COVID-19 related challenges but has a positive outlook in the medium-term.
AT&S FY19 Earnings Results
The Leoben headquartered firm makes most of its money fabricating a range of printed circuit boards and IC substrates. Apple counts the firm among its suppliers now for several years, and it also has contracts with Intel and a variety of European automakers.
In its earnings statement, AT&S noted it did not surpass its FY19 sales of €1.02 billion ($1.11 billion) because of the economic impact of the Sino-American trade war, Brexit, and now the coronavirus pandemic.
The firm reported FY20 earnings before interest, taxes, depreciation, and amortization (EBITDA) of €194.5 million ($210.33), down 22.2 percent year-over-year. In addition, the company’s annual profits contracted because it increased its capital expenditure by 116.7 percent.
On a per-segment basis, AT&S kept revenue generation stable in its core businesses but experienced decreases in income. The firm’s Mobile Device & Substrates profits fell by 18.1 percent from the 2019 fiscal year while its Automotive, Industrial, and Medical EBITDA plunged by 45.1 percent.
Positive But Measured Outlook
Because of coronavirus prompted market volatility, AT&S did not offer granular guidance for FY21. The corporation noted its operations have not been “essentially affected” by the pandemic, its impact on demand is unknown. However, the firm expressed confidence in its ability to overcome the challenges presented by current conditions.
Based on its current projections, the firm expects its first-quarter revenue will be consistent with Q1 2019. Further out, the PCB maker believes its introduction of new mobile device products will be hampered by industry instability. The company also expects industrial and medical orders will remain flat but is unsure about interest in its automotive components.
Nevertheless, the company holds that global digital infrastructure expansion will continue in the medium-term, which will foster its growth. The manufacturer specifically highlighted the increasing popularity of 5G technology as a key revenue driver because it is a leader in the sector. As such, the firm expects to double its revenue and improve its net margin by 5 percent in the coming years.
Though COVID-19 has significantly altered the semiconductor marketplace, AT&S’s forward-looking strategy and proven resiliency suggest its forecast is justified.