VIA optronics AG

Welcome. Joining me today are Juergen Eichner, Founder and Chief Executive Officer, and Dr. Marcus Peters, Chief Financial Officer. I'd like to remind everyone that statements made during this conference call relating to the company's expected future performance, future business prospects, or future events or plans may include forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. Participants are directed to via Optronics Form 20F for a description of certain business risks, some of which may be outside of the control of the company that may cause actual results to materially differ from those expressed in the forward-looking statements. We expressly disclaim any duty to provide updates to our forward-looking statements, whether as a result of new information, future events, or otherwise. Our earnings release for the preliminary second quarter 2022 results is posted on the company's website at via-optronics.com. With that, let me now turn the call over to Jurgen for his opening remarks.

Yeah, thank you, Lisa. Good morning and afternoon. Thank you all for joining us today. So once more, we are proud of how our team has performed during the quarter amidst ongoing component shortages and shipping challenges. We grew the top-line revenue by 10% with 15.5% growth in our display solution segment driven by stronger demand across all end markets and the ongoing production ramp-up at the facility in Nuremberg. Further, we continue to see a greater need for connectivity in cars, more autonomous systems and shared mobility. The accelerated transition to a carbon-neutral economy is creating a strong tailwind for EV and hydrogen markets, and we expect increasing adoption of more advanced infotainment panels as well as cluster and mirror replacement screens by electric vehicle, hydrogen cars, and additional car producers. Our capabilities, such as applying leading-edge cold form technology for cover lenses, stands up to the accelerating needs of automakers to provide superior durability and functionality inside their vehicles. Additionally, cold form technology does not only provide technological advantages, but also uses a lot of less energy compared to hot form for production. Therefore, we are improving our green footprint. On top of that, our technology achieves higher contrast and brightness without extra energy for LCD backlight. This again benefits the green footprint, resulting in much higher competitiveness compared to others. We remain encouraged by the strengths of our growing project pipeline as we continue to focus on higher value projects that will support merchants. Additionally, we continue to execute on our strategy with a target of 500 million in the annual revenue by 2026. We already maintain a backlog of approximately 250 million for that year, which supports this prediction. We continue to implement our previously announced actions to improve profitability and cash flow with various cost savings and performance improvement projects expected to take effect during the second half of the year. These actions include both internal activities, such as improving production efficiencies and streamlining resources, as well as measures related to customer pricing and supplier agreements to improve the company's profitability and cash flow. Most of our sales prices have already been adjusted and freight costs continue to be offloaded. We remain on track to become net profit neutral at the end of the year on a run rate basis. Furthermore, as indicated before, based on our very low use of energy in our production, we are not as impacted by energy costs compared to most others in the industry. This quarter, we announced plans for a new production location in the Philippines to support our growth strategy as we diversify our production base and improve cost efficiency. We can leverage VIA Electronics in the Philippines, which we incorporated in September of last year, to build a new, more cost-effective site that can produce current VR products in conjunction with the Chinese production site in Suzhou. This site helps VR Optronics to expand our production capabilities and capacity in Asia and exemplifies the significant growth in demand for our solutions. Furthermore, we announced a new production line in Thailand due to the increase in camera demand that we see in the future. Similar to this place, cars will be equipped with up to 10 cameras per car We continue to expect that camera revenues will become a very visible revenue stream in the future. In summary, we are pleased by the process we have made during the second quarter of 2022, with effects becoming visible during the remainder of this year and beyond, supporting continued momentum and growth. With that said, I'd like to turn now the call over to Markus for a review of our second quarter 2022 performance in full-year outlook. Markus.

Thanks Jürgen and good morning and good afternoon to everybody. I'll start by reviewing our financial and operating performance for the second quarter of 2022. Then I will outline the outlook for the third quarter in full year 2022. For the second quarter, total revenue of 48.1 million, increased 10% from 43.7 million euros in the second quarter of 2021, driven by further growth in the display solutions segment. Display solutions revenue of 43.2 million euros increased by 15.5% from 37.4 million euros in the second quarter of 2021, driven primarily by stronger demand in end markets and ongoing production ramp-up in Nuremberg. Sensor technology's revenue of 4.9 million euros decreased by 21.8% from 6.3 million euros in the second quarter of 2021 due to lower demand, partially as a consequence of market saturation. Revenue from the automotive end market increased 54% in the second quarter 2022 and accounted for 46% of display solutions revenue, especially due to higher volumes in the EV market segment. Revenue related to the industrial and specialized applications end market decreased 22% in the second quarter 2022, yet still accounted for 30% of display solutions revenue. Revenue related to the consumer end market increased 37% in the second quarter 2022 and accounted for 24% of display solutions revenue due to stronger demand partially caused by the termination of lockdown restrictions in China. Gross profit margin decreased to 8.5% from 14% in the second quarter of 2021. Display Solutions' cross-profit margin of 6.5% decreased from 10.7% in the second quarter of 2021 due to higher logistic costs throughout the value chain and margin pressure. Sensor Technologies' cross-profit margin of 31.8% decreased slightly from 34.4% in the second quarter of 2021 driven by a decline in demand and consequently lower utilization of the production facility in Japan. We continue to work on stabilizing the current situation with our team in Japan. Research on development expenses decreased to 1.7 million from 2 million in the second quarter of 2021 as we shifted towards utilizing more internal R&D services. Selling expenses remained stable at 1.2 million euros. General and administrative expenses of 6.5 million euros increased from 4.9 million euros in the second quarter of 2021. Operating loss was 1.2 million in the second quarter 2022 compared to operating loss of 3.1 million in the second quarter 2021. Net loss was 1.4 million euros or 31 euro cents per basic and diluted share. compared to net loss of 4 million euros or 88 euro cents per basic and diluted share in the second quarter of 2021. EBITDA loss was 0.1 million euros in the second quarter of 2022 compared to EBITDA loss of 1.9 million euros in the second quarter of 2021. Display Solutions EBITDA loss was 0.3 million euros compared to EBITDA of €0.9 million in the second quarter of 2021. Sensor Technologies EBTR was €0.3 million compared to €1.6 million in the second quarter of 2021. Other segments EBTR loss was €0.1 million compared to an EBTR loss of €4.4 million in the second quarter of 2021. The second quarter of 2021 results were positively impacted by SXK. We finished the second quarter with cash-in-cash equivalents of 53.3 million euros, up from 47.1 million at the end of the first quarter of 2022, which was driven by improvements in working capital management, which enhances our runway to fund our growth initiatives. For the third quarter of 2022, we expect total revenue in the range of 44 to 49 million euros. For the full year 2022, we continue to expect revenue growth for approximately 5 to 10 percent compared to 2021, taking into account all economic uncertainties. In closing, we are on track to achieve long-term consistent growth. We remain focused on our growth perspectives, especially in the automotive and industrial markets, and are committed to implement further initiatives to improve the company's profitability. With that financial overview, I'd like now to turn the call back over to Jürgen for a few closing comments. Jürgen.