EQS-News: AT&S Austria Technologie & Systemtechnik AG: AT&S already positions itself for the financial year 2026/27

EQS-News: AT&S Austria Technologie & Systemtechnik AG / Key word(s):
   Miscellaneous
   AT&S Austria Technologie & Systemtechnik AG: AT&S already positions itself
   for the financial year 2026/27

   16.03.2023 / 14:33 CET/CEST
   The issuer is solely responsible for the content of this announcement.

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   AT&S already positions itself for the financial year 2026/27

    

     • Customer diversification successfully initiated
     • Revenue growth of € 1.8 billion in 2022/23e to € 3.5 billion in
       2026/27e
     • Ready for challenging market environment

    

   Leoben – Given the current market environment, AT&S has adapted its pace
   of growth to the market conditions and postponed its medium-term goals by
   a year to the 2026/27 financial year. “While the current weakness of the
   market in the area of IC substrates affects the speed of our growth, it
   does not change anything about the long-term perspective of our markets
   and our positioning,” says CEO Andreas Gerstenmayer. “On the contrary, we
   will use this challenging time to emerge stronger and continue to drive
   our strategy with a broader customer portfolio,” Gerstenmayer comments on
   the company’s perspective. “Initially, this will, however, require
   consequent adjustments to our cost structures,” he concedes.

    

   Customer diversification successfully initiated

   As part of its diversification strategy, AT&S has already succeeded in
   winning additional IC substrate customers. Therefore, the R&D centre in
   Leoben, which is currently under construction, will be expanded to include
   real series production, supported by financing contributions of the new
   customers. These customers operate in the computing/data processing
   business and have a high need for IC substrates; they use these to offer
   energy-efficient processors, among other things.

    

   In addition to the diversification in the area of IC substrates, the
   company also won major new customers in the PCB business and significantly
   increased profitability. This shows that a broad, high-quality portfolio
   pays off.

    

   Revenue growth of € 1.8 billion in 2022/23e to € 3.5 billion in 2026/27e

   The outlook for 2025/26, which AT&S presented in November 2021, was based
   on a completely different market environment with high growth forecast for
   IC substrates. The Ukraine conflict and its impact on the energy market,
   growing tensions between the USA and China as well as the general economic
   slowdown, coupled with rising inflation, have had a significant negative
   effect on market conditions after the end of the COVID pandemic. The
   extreme increase in PC and notebook sales as a result of mandatory remote
   working during the pandemic led to a saturation in this segment and
   consequently market weakness coupled with high inventories.

    

   As a result of the changes in the market and the reduced growth momentum,
   AT&S had to adapt its projects and projections. The medium-term goals were
   consequently postponed by a year. AT&S expects to generate revenue of
   approximately € 3.5 billion in 2026/27 and anticipates an EBITDA margin of
   27 to 32%. This corresponds to a compound annual growth rate for revenue
   of 17% (2022/23e: € 1.8 billion) and a significant increase in
   profitability.

    

   Ready for a challenging market environment

   In the markets for IC substrates, demand for notebooks is expected to be
   lower in 2023 than in 2022. The negative impact on the supplier chain is
   further intensified by high inventories. According to current forecasts,
   this will affect the first half of 2023 in particular; towards the end of
   the year, demand is expected to recover. The demand for IC substrates for
   servers will benefit from the technology shift towards heterogeneous
   integration[1][1].

    

   In order to mitigate the resulting effects, such as pressure on prices and
   inflation, AT&S has initiated comprehensive cost optimisation programmes.
   These programmes focus on expanding the scope for the ongoing improvement
   measures and on accelerating their implementation. AT&S had already
   announced sustainable cost optimisations in February, predominantly based
   on measures to increase productivity and material use as well
   optimisations in purchasing. Against the backdrop of growing market
   challenges, AT&S has intensified these programmes. Compared to the
   financial year 2022/23 cost savings totalling € 440 million are expected
   for the following two years.

    

   In addition, the investment programmes will be analysed depending to the
   respective expected demand and adapted to the respective market situation.
   In the 2022/23 financial year AT&S invested CAPEX of approximately € 600
   million in the location in Chongqing, China. The plant in Leoben, Austria,
   is being completed for the new customers and the first machines are
   already being installed. In Kulim, Malaysia, € 340 million was invested in
   the 2022/23 financial year. One of the two plants in Kulim is currently
   being finalised; the first machines have already been installed.
   Production is expected to start in 2024 as planned. The second plant in
   Kulim will be completed regarding the building envelope, for which
   considerable costs will still be incurred; however, the timing of the
   procurement and installation of the infrastructure and production
   equipment depends on how the market and the situation of a relevant
   customer develop. As a result, the investment volume for the 2023/24 and
   2024/25 financial years will be reduced by a total of € 450 million
   compared with the original plan – despite an increase in investment
   requirements in Leoben. In 2021, AT&S had announced investments totalling
   € 2.2 billion for the locations in Kulim and Leoben; currently the company
   is planning total investments of € 1.8 billion in the medium term.

    

    

    

   AT & S Austria Technologie & Systemtechnik Aktiengesellschaft – Advanced
   Technologies & Solutions
   AT&S is a globally leading manufacturer of high-end printed circuit boards
   and IC substrates. AT&S industrialises leading-edge technologies for its
   core business segments Mobile Devices & Substrates, Automotive, Industrial
   and Medical. AT&S has a global presence with production sites in Austria
   (Leoben, Fehring) and plants in India (Nanjangud), China (Shanghai,
   Chongqing) and Korea (Ansan near Seoul). A new high-end production site
   for IC substrates is currently being established in Kulim, Malaysia. The
   company employs roughly 15,000 people. For further information please
   visit [2]www.ats.net

    

    

    

   Press contact:

   Gerald Reischl, Vice President Corporate Communications

   Tel: +43 3842 200 4252; Mobile: +43 664 8859 2452; [3][email protected]

    

   Investor Relations contact:

   Philipp Gebhardt, Senior Director Investor Relations

   Tel: +43 3842 200 2274; Mobile: +43 664 7800 2274; [4][email protected]

    

    

   AT & S Austria Technologie & Systemtechnik Aktiengesellschaft

   Fabriksgasse 13
   8700 Leoben / Austria
   [5]www.ats.net  

   [6]^[1] Heterogeneous integration means that the different functionalities
   of a single microchip are split up into chiplets, which reduces costs and
   increases performance. However, this requires significantly larger and
   more complex IC substrates to ensure the connection between the individual
   chiplets

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   16.03.2023 CET/CEST This Corporate News was distributed by EQS Group AG.
   www.eqs.com

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   Language:    English
   Company:     AT&S Austria Technologie & Systemtechnik AG
                Fabriksgasse 13
                8700 Leoben
                Austria
   Phone:       +43 (1) 3842200-0
   E-mail:      [email protected]
   Internet:    www.ats.net
   ISIN:        AT0000969985, AT0000A09S02
   WKN:         922230
   Indices:     ATX
   Listed:      Regulated Unofficial Market in Berlin, Dusseldorf, Frankfurt,
                Hamburg, Hanover, Munich, Stuttgart, Tradegate Exchange;
                Vienna Stock Exchange (Official Market)
   EQS News ID: 1584637


    
   End of News EQS News Service


   1584637  16.03.2023 CET/CEST

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