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VIA optronics AG American Depositary Shares, each representing one-fifth of an Ordinary Share
Q4 2022 Earnings Conference Call
3/28/2023
spk_0: hello everyone and welcome to the by optronics full quarter twenty twenty two financial would have to thank you for standing by money baby and i'll be coordinating a cold day if you would like to ask a question please craft store followed by one or know per phone keypad oh no like to have your hand over your host some new cohen with alpha i agree to begin say some please go ahead
spk_1: right you and welcome joining me today or juergen eichner founder and chief executive officer and doctor marcus peters chief financial officer i like to remind everyone that fitness made during a conference commonly to the company's expected future performing future business prospects are future events or plan may include code looking statements and depending funding the product security litigation reform act of ninety ninety five a different part of was elected to the optronics on twenty of perception of certain business with some of which may be outside of the controlled the company that may cause actual results to materially different from the expression or looking and we expressed be disclaims any duty to provide updates are forward looking statements without your permission future events or a lot our own is really cross the wire shortly for the foot preliminary analysis fourth quarter or years of of twenty two issue and will be shortly put on the company's website at the arch on it's back home republicans are food preliminary on a result become do not provide segment bible teaches quarter been audited group and it's same as we made available to the required one yeah period with that woman out from nepal reardon for a few opening remarks
spk_2: thank you sam i'm good morning and thank you for joining us today into this call little couple fourth quarter and four year twenty twenty two as well as she outlook for twenty twenty three total revenue for the fourth quarter was fifty four point nine million an increase of eighteen point six percent from four to six point three million in the fourth quarter of twenty twenty one total revenue for the full year and it and then it is to was two hundred eighteen point five million an increase of twenty point nine percent from one hundred eighty point eight million in twenty twenty one dublin growth exceeded all expectations and was driven by continued strength notice play solutions segment we were pleased with all fourth quarter results capping an important year in enrich our team has demonstrated resolve in overcoming challenges presented by the broader microelectronic and mcrae could have an economic environment including supply chain efficiencies an ongoing effects of the cool with nineteen pandemic which impacted operational results in twenty twenty one and twenty twenty two as i stepped back and look at the full year you made significant strides to resolve such impacts by costs down activities and says present suspense even so the measures did not cover the whole year as they faced in during the course of twenty twenty two be can already showed significantly improved results in twenty twenty two furthermore we could consolidate and strength of the organization expanding older but facility and completing our production ramp up while implementing cost savings measures to expand buses further improvements will face in than twenty twenty three like production efficiency measures shit service so sorry shit service savings and others epic country to there will be the production numbers are on you know smoothly showing that we can produce eat my of quantities compared to what replant the production line was enhanced to enable significantly higher throughput additionally we continue to separate ourselves from competitors buffalo the pushing our display and sensor technology as well as the camera portfolio this enables us to fulfill that the specifications of automotive industry customers which i ever changing and advancing and we remain an optimal position to exceed the unique requirements the growing demand for some that readable in an outdoor displace as well as sensors and cameras has resulted in increased or order volume for the cutting edge technology solutions oh we are excited about or healthy pipeline of projects with fortune four hundred companies additionally we are exploring opportunities to extend our solution for kind to us with the active display in touch functionality with industry partners we believe that will drive considerable growth in the future and look forward for sharing additional details later this year as it fits the demand the requirement of changing automotive supply chain turning to our cost savings to the she is kinda should use our shit service and then if lupins will allow us to consolidate all administrators and global services which will drive some issues and recuse operating expenses and recently kicked off offers chet services activities in the philippines you believe that this combination would allow us to dispute resources and free up chemical be improved business critical functions and focus on growth opportunities in each of the three and markets looking at to twenty twenty three it appears that elevated freight cars are beginning to ease and all measures taken mitigate the impact going forward in twenty twenty three be anticipate the for the realization of the previously announced performance improvements and continuously focus on higher value projects that will support much it's going forward we believe that these initiatives to continue to help improve our much and profile in position to company for long term sustainability
spk_3: and profitability
spk_2: despite a challenging macro environment macro economic environment they are strong structurally team wins in the and markets and which we operate and we remain well positioned to capture the spending applications and use cases for products the increased adoption of electronic vehicles and sophistication of applications in these vehicles support our long term growth forecasts and be continue to believe that he provided really differentiate offering to out when does to new orleans with it said was that set i know like to turn to call over markers for if you have a fourth quarter and full year twenty twenty two performance and a for year outlook marcus
spk_4: like you're you're in the morning good afternoon for everyone of it's thought by reviewing of financial and operating performing for the fourth quarter and before year two thousand for two then i'll outline also for the first quarter and for your two thousand twenty three but the fourth quarter the revenue of fifty four point nine increased by eight point six percent from four forty six point three million euros the fourth quarter to home riven by further growth in our display the russian segment supported by strength to the automotive and bargain then thought technology's revenue decrease from headed for photo with for the one you to lower demand is a consumer and market gross profit margin margin increased to two point six percent from that point seven percent of the fourth quarter of two thousand twenty one you to are extra product make favor of it's effect and cup and are related one time display solutions gross profit much of increase compared to the fourth quarter of two thousand twenty one the fight margin pressure linked to increases in mature growth deflation fergus that with the expensive as well as an award competitive environment and that acknowledges gross profit margin degrees to do that or of pandemic on a project friendly lot of television the research and development expensive increase compared to the fourth quarter of two thousand twenty one selling veteran and general and administrative expenses degrees compared to the fourth quarter of two thousand forty one you to further improvements to the administrative crop fracture in favour of on time effects fix for could be held over all favor operating lot of four point four million the fourth quarter two thousand twenty two compared to an operating loss of them front of me the the fourth quarter of two thousand twenty one lot of the texas from continue operation attribute attributable to be a chronic a shareholder was as six million euro them have one from the one euro thirty one as share the fourth quarter of two thousand ready to compared to a lot of the texas from continue operations attributable to be a product edgy up of eight million euros for one euro seventy seven for sale and the respect of for don't of two thousand and twenty one if better outlook what two point seven million euro in the fourth quarter two thousand twenty two compared to have two and a better angle of six point one billion euros in the fourth quarter of two thousand twenty one if resolution a the are increase compared to the fourth quarter of two thousand twenty one driven by operation performance and nonrecurring event the technology every to a degree likely compared to the for photo two thousand twenty one and of a me he be there are degrees compared to the fourth quarter of two thousand twenty one new to the whole year financial performance total revenue of two hundred eighty fifteen million euros increased by twenty point nine percent from one hundred eighty point eight million compared to two thousand twenty one the increase was mainly driven by strong performance and that is split the recent segments supported by increase demand for our solution especially within the automotive and market venice favour fine change effect sensor technology revenue decrease compared to two thousand twenty grand you to have your to especially as the sorry attend the technology is ugly your empty treats compared to two thousand twelve twenty one you for lower demand specially in the third and fourth quarter of two thousand twenty two and the consumer and market after a record turn over in the prior year ross profit margin for ten point three percent down from eleven point three percent to two thousand twenty one our enter result of i know that for impacted by effect resulting from a stronger you're at done are compared to that the euro over the year deflated wasn't drug profit margin slightly increase compared to two thousand twenty one despite ongoing much pressure and are highly competitive environment center technology is gross profit margin degrees compared to two thousand twenty one you to the look to the lower part pandemic demand be consequently know why you tradition research and development expensive than two thousand twenty two increase due to the support of the company's future strategy to expand into integrated is littered with him my over germany to be age was fully integrated into two thousand twenty two rivers setting expenses and general and administrative expenses decrease in two thousand for the school compared to two thousand twenty one two to improve processing plant and the administrative function and one time to think of all the fixed cost structure could be have seven despite and and and increase revenue operating loss of a six point seven million euros from passed on operating lot of nine point five million euros in two thousand twenty one lot of the taxes from continuing operations attribute attributable to be up front pages out of was nine point nine million euro or two girls seventeen percent in two thousand twenty two compared to a lot after taxes from continue operations attributable to via front edges shahada of eleven point eight million years thought to your fifty nine percent two thousand and twenty one
spk_5: porter a better outlook was
spk_4: and whole point two million euros in two thousand twenty two compared to and a be there are lots of three point four million euros in two thousand twenty one it's great solution if you to our increase competitive robert vaughn driven by improve operation performance and nonrecurring effect sensor technology and other segments a better are decrease competitive two thousand twenty one for the first quarter of two thousand twenty three the expect total revenue in the range of about forty two forty five million euros for the full year two thousand twenty three company expects revenue for be around thousand and twenty two eleven at the experience increased volatility consumer demand the company is increasingly focusing on profit over revenue growth and villages it for for you accordingly via the focus on the most promising carmarthen applications and at the same time intensified is diversification into industrial applications additionally he will continue to focus on networking capital management the plan to continue growing our revenue over the upcoming years but it the most likely not to be linear this is due to increased volatility is there a couple who customer demand new project starting did and sharpening all much him for for profile even if you finish the felt for the fourth quarter of cash and cash prevalent as well as short as other short term deposit of fifty two point four million euros which route support our strategic approach his throat growth initiative with that financial of a you i'd like to turn now the call back to your for to closing comment your
spk_2: take your workers as you what we've been through quite challenging to use in the past and are now back on track be prioritized profit overgrowth right efficiency and i expanding our portfolio was kind curious illusions on top of holland and active display and censor solutions pick somber a to for example complete dashboards including our product portfolio but is set to maintain our five hundred million revenue talked intend to twenty six and feel confident about our prospects to improve profitability and twenty twenty three our financial discipline remain strong and we have a solid base from which we can deliver strong growth and shareholder value and the as to come thank you for your continued support that concludes our prepared remarks and are now turned the corner for to the operator fukyo any
spk_0: i'm kids as a reminder if anyone would like to register a question please press star followed by one on your telephone key pad if you'd like to withdraw your question please press saw it by two i'm prepared to ask a question please ensure you want me to likely to that star flipped by one on your telephone keypad too much or question we have a question registered from anthony anthony stuff from cray column on think we had to learn from them
spk_6: thank you argument you're gonna markets
spk_2: just for housekeeping what can we expect a full income statement with each of the lines rather than the brigade one
spk_6: put out like today
spk_4: crescent as soon as auditor fun of as a pc a be account
spk_7: oh okay
spk_8: later north from
spk_1: i'm sorry later today did you say marcus i would like this with the publication of if twenty
spk_4: okay
spk_6: got it in a new organ of just as a woman or the up the numbers but for not allowed to publish it
spk_1: got it okay palm you're going on the the comments in the release that you're gonna you're getting flat revenue for twenty twenty three two to focus on more profitable business
spk_6: in the union sense of what your expectations are and gross margins what you're willing to take what do you think the full twenty twenty three gross margin might look like
spk_2: for you can october twenty years yeah so the i cannot comment on the and percentage of the cause much in in this year but what i can tell us as and i think we just be disclosed that before that we basically eliminated discontinued some of the law much in consumer projects that the i'm focusing on the the higher much importance of of course then we have at the end of the day i'm now i'm at and a book in production and be brooklyn efficiency the this is all coming together oh my god the final much shouldn't talk it remains what we have been communicating during the ip all am how that will increase over the next usual show communicate on a call in a follow up call but i'm for now i cannot comment on the much in foot ended of industry as you know vs asked him under i'm under we haven't completed the filing it
spk_9: no i understand the filing for the the queue for i'm just curious if you're focusing on you're saying that that the press release you want you have is and higher profit margin deals are design with what what's your goal and gross margins me what are you not willing to take business wise and what are you willing to take with
spk_2: wise from a gross margin perspective nothing debts
spk_4: that polio okay so our one office at a complex question on the one in
spk_10: for balance your capacity that your capacity is utilize that cross eyed capacity to service you have
spk_11: but mean of course
spk_12: the martian that me
spk_4: current level or lower level however to be a profitable organization as he says doubt that finished off for optimism more higher margins you
spk_13: and if not have eternity a specific can operate that a significant at a higher
spk_14: real and i realize now
spk_2: i'm who maybe i'm from from from am from the overall direction so we basically push to get deal so we are much advice over twenty percent of course it's hard to fill out this would marcus's saying empty capacity which will then come up as a mix with the new portfolio that be are planning that should they be can drive it to the much any from ohio but what you have feel last two years and this is one of the reasons why we have not been performing as we all list was that the automotive industry use the last two years of to cup matches as much as the him on the on the supply chain saw this is one of of the reasons why the have been affected snow again in this is five years five for higher value applications and of course trying to maintain outlets april the new projects maintain that much of at least twenty
spk_15: he hoping that this is at the end of the day in in in the three four five years from now the the average
spk_6: important for okay in the
spk_16: right
spk_6: he didn't give me for you anyways markets the maybe can tak about of can you comment on how many ten percent customers you had in in the december quarter and and what percentage of revenue was your biggest customer
spk_17: ten percent
spk_18: and your what percent of revenues was your biggest single biggest customer
spk_19: the figure three of talking about it
spk_20: well known
spk_4: or producer
spk_21: our
spk_20: from a five cross
spk_4: our customers in singapore and on our of a bonafide a and has four to doubt published for the vague of talked about and we probably have something about for your heart's content via a can overcome percent
spk_6: five and ten
spk_4: ago have to open up for five
spk_6: and it also depends how you manage the project
spk_4: i'll just i'll jump back in the queue agatha agatha apply on have to do not this is him over ten percent on turn over sort of sorry for apathetic about five customer for it i did everything i was wrong as broken an arrow i'm i'm pretty much of a federal mean you meant biggest customers
spk_2: yeah what percent of rabbits twenty present thirty present your single biggest customer in the in the quarter
spk_8: cut them up with doubt
spk_6: or ever or i was over narrative rather than up with you
spk_22: frederick recently source
spk_2: that think the tony wanted to see how many customers to we have which have a a revenue shield more than ten percent that's about five four
spk_23: five or three on area
spk_24: got it and then my for it thought about it and maybe your gun maybe you could even just ballpark this you'd be your biggest auto customer what person their revenue or they
spk_6: ah must i'm not ah another one hundred percent sure but they should be in these and twenty percent range but that be okay
spk_25: to say oh with them not to hundred percent sure
spk_2: and over
spk_26: top ten still ten that is somewhere between ten and twenty
spk_2: and the thrones it
spk_0: okay i went along with a couple excellent
spk_6: okay nodded what will we get tickets up offline but i'll jump back at you for others that got us
spk_27: i'm tony
spk_0: yes and no i'll just have to question are you are you next week or in two weeks in in the bay area
spk_2: ah no okay so i was hoping to meet we can chat on our we can chat on or call back here and in a while been i'll just go back to get to the other questions in the public publica okay i agree
spk_0: we don't have any further questions registered shall tiny if you want to have anything else
spk_28: no i i think of good for now all above line
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