Growth in sales to 522 million euros in 2007, cash flow from operating activities increased to the two and a half-fold, order intake posts a rise of nearly 9 percent. The result was down on the previous year. Strategic realignment will be continued in 2008.
The Jenoptik Group can look back on a year of significant change whilst simultaneously posting a successful fiscal year. "We implemented the company's customer and market-driven orientation with the help of a new corporate structure and culture and at the same time brought our key projects for the year 2007 to a successful conclusion", said Dr. Michael Mertin, Chairman of the JENOPTIK AG Executive Board since July 2007, at the press conference for the presentation of the financial statements on Friday in Jena. Jenoptik is an integrated optoelectronics Group which is divided into five divisions. The know-how in the field of optoelectronics forms the basis for the activities in the area of Lasers & Optics and is the enabling technology for the systems-related businesses in the Industrial Metrology, Traffic Solutions and Defense & Civil Systems divisions. "We have achieved our objectives and brought about a radical change in the Group. In ECE we also have a new major shareholder who welcomes the strategic reorientation and is supporting this through its medium to long-term commitment" said the Jenoptik boss.
In addition to the fundamental restructuring of the Group to make it more market and customer oriented, the key objectives in 2007 were:
- increase in cash flow,
- reduction of net debt and increase in shareholders' equity ratio,
- a new financing structure appropriate to the company's needs,
- as well as the consistent adjustment in the business portfolio.
Sales of the Jenoptik Group increased by 7.5 percent to 521.7 million euros (prev. year 485.1 million euros), almost 60 percent of which came from abroad. Cash flow from operating activities, which improved by more than 150 percent to 73.8 million euros (prev. year 28.8 million euros), unlike in previous years enabled the Group to finance all its capital expenditure and financing costs without having to resort to borrowings. The Group result from operating activities (Group EBIT), at 35.3 million euros, was below the figure for the previous year (prev. year 38.2 million euros). This reflects a generally weak year for Traffic Solutions which reported an absence of major international orders, whilst business in the domestic market remained stable. The area also invested massively in the new Traffic Service Providing business unit which is being significantly expanded in the USA following the receipt of an initial major order at the beginning of 2007. This was almost but not entirely offset by a very good set of results posted by the Laser & Optics business, up by 52 percent. Business development in the Mechatronics division was stable; this area primarily represents Jenoptik's activities in the defense technology business and its long-term nature is a characteristic feature.
One-off effects, which arise from the consistent adjustment in the Group portfolio and are included in the Group EBIT, balanced each other out. One of the key items of the one-off effects on the positive side, at approx. 24 million euros, was the sale of the PVA TePla shares in October 2007. This was offset by negative one-off effects of almost the same amount which resulted from the termination and disposal of various business activities as well as from value adjustments. "In the 2nd half of the year we analyzed and valued the business portfolio on the basis of current information and were forced to revise downwards the future earnings prospects for some of the initiatives. High value adjustments were required in particular due to the fact that we relinquished individual business activities." stated Michael Mertin.
The financial result came in at minus 34.6 million euros (prev. year minus 19.1 million euros) and was influenced for the very last time in 2007 by the high interest bond which had originally been issued to finance the business of M+W Zander. In mid November the bond could be repaid early, mainly using the funds from the sale of M+W Zander. For this reason - over and above the interest costs - one-off costs in the sum of 9.6 million euros had to posted arising from the compensation for early repayment. In addition, up to November 2007 high interest expenses for the high interest bond were offset by markedly lower interest income for the restricted cash which was then used for the repayment. The redemption of the bond will significantly improve Jenoptik's interest result in the future. Earnings before tax were therefore only just above the line at 0.7 million euros (prev. year 19.1 million euros). A non-cash deferred tax expense in the sum of 4.4 million euros was incurred as a result of the German tax reforms, earnings after tax therefore totaled minus 4.6 million euros (prev. year 16.1 million euros). Without the one-off effects described above, e.g. for the redemption of the high interest bond, the earnings after tax would have come out at above 10 million euros.
8.9 percent growth in the order intake. Reduction in the balance sheet total, further reduction in net debt.
The Jenoptik Group posted an 8.9 percent increase in its order intake despite a weak Sensors business. Order intakes rose to 525.8 million euros (prev. year 482.9 million euros) with Laser & Optics activities reporting the strongest organic growth with a rise of nearly 10.7 percent. The order backlog totaled 439.4 million euros and was consequently at the same level as in the previous year (per 31.12.2006: 438.4 million euros).
The balance sheet total reduced primarily as a result of the repayment of the high interest bond to 697 million euros as at the end of 2007 (31.12.2006: 874 million euros), a level more appropriate to the volume of business. The shareholders' equity ratio rose from 34 to 40 percent. Net debt was reduced to 191.7 million euros (31.12.2006: 203.0 million euros) despite two acquisitions.
The policy on dividends is intended to reflect the Group's realignment towards a more focused technology company also in 2007/2008, consequently no dividend will be paid for the year 2007.
Laser & Optics business posts high growth rates in 2007. Major orders in the double figure million range at end 2007 and beginning 2008.
The Group's Laser & Optics business posted double figure growth rates in 2007, with the EBIT, up by 52.3 percent, posting a disproportionately high rise compared with sales (plus 10 percent). With the formation of the joint venture JT Optical Engine, Trumpf and Jenoptik combined their fiber laser activities in 2007 and are jointly developing so-called optical engines for fiber lasers which are driving growth in the global laser market. The acquisition of EPIGAP Optoelektronik GmbH, Berlin, the key addition in 2007, provides for the combination of extensive expertise in the field of optics and semiconductor know-how and completes the technology chain for optoelectronic systems. Epigap specializes in the development and manufacture of photo diodes, LED chips and components as well as optoelectronic modules and is currently being integrated into the business portfolio. In the Sensors division the Etamic Group which was included for the first time for the full year and the integration of which was the characteristic feature of the 2007 fiscal year, led to small increases in the sales and order situation. Earnings of the Sensors division were significantly affected by the sharp fall in the Traffic Solutions business. Mechatronics reported stable development and posted a slight rise in sales, results and order intake.
Outlook for 2008: Sales and earnings expected to show an increase. Strategic realignment showing the first successes in collaboration and synergies.
"With the strategic realignment, accompanied by a more streamlined management structure we are creating the conditions required to achieve valuable and sustainable growth. We will be continuing this process in 2008 and consistently carry this over to the Group's divisions with what is for the most part a new management team and the focus on growth, customers and costs. We are already seeing the first successes of the collaboration. We anticipate a marked increased in sales for 2008 and 2009, accompanied by an improvement in the Group result. We expect the effects arising from the Group's strategic realignment to increase earnings from the year 2009", stated Jenoptik boss Michael Mertin.
In the current 2008 fiscal year, which has got off to a good start with several, multimillion orders, sales are expected to increase further to over 550 million euros. All three new segments (Lasers & Optical Systems, Metrology and Defense & Civil Systems)* plan to grow sales over the next year. As such, sales in the Lasers & Optical Systems segment are forecast to total between 220 and 240 million euros (prev. year 218 million euros). In the Metrology segment, following a slow year for Traffic Solutions and strong inorganic growth in Industrial Metrology in 2007, we are aiming for an increase in organic sales to between 125 and 140 million euros (prev. year 117 million euros). The Defense & Civil Systems segment plans to generate sales of between 185 and 200 million euros (prev. year 181 million euros).
The group result from operating activities is expected to increase to between 37 and 40 million euros. The Lasers & OpticaI Systems segment is again planning to provide high contributions to sales and earnings, the Defense & Civil Systems segment is expected to continue the stable positive development. In the Metrology segment the poor 2007 fiscal year posted by the Traffic Solutions division will still have a partial impact on the earnings situation in 2008 since it will not yet be able to repeat the quality of the results achieved in the years 2006 and before. As in 2007 the quality of the result and consequently the ability to achieve the group targets here will be influenced primarily by the ability to win major orders. The attainment of the targets generally assumes that there will be no significant deterioration in the economic environment. The positive effects of an adjusted group portfolio, together with the financing structure which has been adapted to suit our size and business activities, will start to be seen from 2008 in the interest result, the earnings before tax and after tax, as well as in the balance sheet. The increase in the earnings before tax in 2008 will therefore be at a significantly disproportionately high rate to the increase in the operating result.
"We are keeping to our long-term objectives: growth averaging 10 percent per annum, sales of one billion euros in the long-term, with an EBIT margin of between 9 and 10 percent. To this end we have started up numerous initiatives throughout the Group which are geared towards our five value levers of growth, customer orientation, internationalization, employees & management and operational excellence", said Michael Mertin.
Additional information
The segments reflect the new organizational structure and in view of the different composition of the operational business cannot be compared with the old structures nor consequently with their key indicators for 2007.
You will be able to view the full 2007 Annual Report from 9 a.m. online at www.jenoptik.com under Accounts and Reports.
The Jenoptik Group can look back on a year of significant change whilst simultaneously posting a successful fiscal year. "We implemented the company's customer and market-driven orientation with the help of a new corporate structure and culture and at the same time brought our key projects for the year 2007 to a successful conclusion", said Dr. Michael Mertin, Chairman of the JENOPTIK AG Executive Board since July 2007, at the press conference for the presentation of the financial statements on Friday in Jena. Jenoptik is an integrated optoelectronics Group which is divided into five divisions. The know-how in the field of optoelectronics forms the basis for the activities in the area of Lasers & Optics and is the enabling technology for the systems-related businesses in the Industrial Metrology, Traffic Solutions and Defense & Civil Systems divisions. "We have achieved our objectives and brought about a radical change in the Group. In ECE we also have a new major shareholder who welcomes the strategic reorientation and is supporting this through its medium to long-term commitment" said the Jenoptik boss.
In addition to the fundamental restructuring of the Group to make it more market and customer oriented, the key objectives in 2007 were:
- increase in cash flow,
- reduction of net debt and increase in shareholders' equity ratio,
- a new financing structure appropriate to the company's needs,
- as well as the consistent adjustment in the business portfolio.
Sales of the Jenoptik Group increased by 7.5 percent to 521.7 million euros (prev. year 485.1 million euros), almost 60 percent of which came from abroad. Cash flow from operating activities, which improved by more than 150 percent to 73.8 million euros (prev. year 28.8 million euros), unlike in previous years enabled the Group to finance all its capital expenditure and financing costs without having to resort to borrowings. The Group result from operating activities (Group EBIT), at 35.3 million euros, was below the figure for the previous year (prev. year 38.2 million euros). This reflects a generally weak year for Traffic Solutions which reported an absence of major international orders, whilst business in the domestic market remained stable. The area also invested massively in the new Traffic Service Providing business unit which is being significantly expanded in the USA following the receipt of an initial major order at the beginning of 2007. This was almost but not entirely offset by a very good set of results posted by the Laser & Optics business, up by 52 percent. Business development in the Mechatronics division was stable; this area primarily represents Jenoptik's activities in the defense technology business and its long-term nature is a characteristic feature.
One-off effects, which arise from the consistent adjustment in the Group portfolio and are included in the Group EBIT, balanced each other out. One of the key items of the one-off effects on the positive side, at approx. 24 million euros, was the sale of the PVA TePla shares in October 2007. This was offset by negative one-off effects of almost the same amount which resulted from the termination and disposal of various business activities as well as from value adjustments. "In the 2nd half of the year we analyzed and valued the business portfolio on the basis of current information and were forced to revise downwards the future earnings prospects for some of the initiatives. High value adjustments were required in particular due to the fact that we relinquished individual business activities." stated Michael Mertin.
The financial result came in at minus 34.6 million euros (prev. year minus 19.1 million euros) and was influenced for the very last time in 2007 by the high interest bond which had originally been issued to finance the business of M+W Zander. In mid November the bond could be repaid early, mainly using the funds from the sale of M+W Zander. For this reason - over and above the interest costs - one-off costs in the sum of 9.6 million euros had to posted arising from the compensation for early repayment. In addition, up to November 2007 high interest expenses for the high interest bond were offset by markedly lower interest income for the restricted cash which was then used for the repayment. The redemption of the bond will significantly improve Jenoptik's interest result in the future. Earnings before tax were therefore only just above the line at 0.7 million euros (prev. year 19.1 million euros). A non-cash deferred tax expense in the sum of 4.4 million euros was incurred as a result of the German tax reforms, earnings after tax therefore totaled minus 4.6 million euros (prev. year 16.1 million euros). Without the one-off effects described above, e.g. for the redemption of the high interest bond, the earnings after tax would have come out at above 10 million euros.
8.9 percent growth in the order intake. Reduction in the balance sheet total, further reduction in net debt.
The Jenoptik Group posted an 8.9 percent increase in its order intake despite a weak Sensors business. Order intakes rose to 525.8 million euros (prev. year 482.9 million euros) with Laser & Optics activities reporting the strongest organic growth with a rise of nearly 10.7 percent. The order backlog totaled 439.4 million euros and was consequently at the same level as in the previous year (per 31.12.2006: 438.4 million euros).
The balance sheet total reduced primarily as a result of the repayment of the high interest bond to 697 million euros as at the end of 2007 (31.12.2006: 874 million euros), a level more appropriate to the volume of business. The shareholders' equity ratio rose from 34 to 40 percent. Net debt was reduced to 191.7 million euros (31.12.2006: 203.0 million euros) despite two acquisitions.
The policy on dividends is intended to reflect the Group's realignment towards a more focused technology company also in 2007/2008, consequently no dividend will be paid for the year 2007.
Laser & Optics business posts high growth rates in 2007. Major orders in the double figure million range at end 2007 and beginning 2008.
The Group's Laser & Optics business posted double figure growth rates in 2007, with the EBIT, up by 52.3 percent, posting a disproportionately high rise compared with sales (plus 10 percent). With the formation of the joint venture JT Optical Engine, Trumpf and Jenoptik combined their fiber laser activities in 2007 and are jointly developing so-called optical engines for fiber lasers which are driving growth in the global laser market. The acquisition of EPIGAP Optoelektronik GmbH, Berlin, the key addition in 2007, provides for the combination of extensive expertise in the field of optics and semiconductor know-how and completes the technology chain for optoelectronic systems. Epigap specializes in the development and manufacture of photo diodes, LED chips and components as well as optoelectronic modules and is currently being integrated into the business portfolio. In the Sensors division the Etamic Group which was included for the first time for the full year and the integration of which was the characteristic feature of the 2007 fiscal year, led to small increases in the sales and order situation. Earnings of the Sensors division were significantly affected by the sharp fall in the Traffic Solutions business. Mechatronics reported stable development and posted a slight rise in sales, results and order intake.
Outlook for 2008: Sales and earnings expected to show an increase. Strategic realignment showing the first successes in collaboration and synergies.
"With the strategic realignment, accompanied by a more streamlined management structure we are creating the conditions required to achieve valuable and sustainable growth. We will be continuing this process in 2008 and consistently carry this over to the Group's divisions with what is for the most part a new management team and the focus on growth, customers and costs. We are already seeing the first successes of the collaboration. We anticipate a marked increased in sales for 2008 and 2009, accompanied by an improvement in the Group result. We expect the effects arising from the Group's strategic realignment to increase earnings from the year 2009", stated Jenoptik boss Michael Mertin.
In the current 2008 fiscal year, which has got off to a good start with several, multimillion orders, sales are expected to increase further to over 550 million euros. All three new segments (Lasers & Optical Systems, Metrology and Defense & Civil Systems)* plan to grow sales over the next year. As such, sales in the Lasers & Optical Systems segment are forecast to total between 220 and 240 million euros (prev. year 218 million euros). In the Metrology segment, following a slow year for Traffic Solutions and strong inorganic growth in Industrial Metrology in 2007, we are aiming for an increase in organic sales to between 125 and 140 million euros (prev. year 117 million euros). The Defense & Civil Systems segment plans to generate sales of between 185 and 200 million euros (prev. year 181 million euros).
The group result from operating activities is expected to increase to between 37 and 40 million euros. The Lasers & OpticaI Systems segment is again planning to provide high contributions to sales and earnings, the Defense & Civil Systems segment is expected to continue the stable positive development. In the Metrology segment the poor 2007 fiscal year posted by the Traffic Solutions division will still have a partial impact on the earnings situation in 2008 since it will not yet be able to repeat the quality of the results achieved in the years 2006 and before. As in 2007 the quality of the result and consequently the ability to achieve the group targets here will be influenced primarily by the ability to win major orders. The attainment of the targets generally assumes that there will be no significant deterioration in the economic environment. The positive effects of an adjusted group portfolio, together with the financing structure which has been adapted to suit our size and business activities, will start to be seen from 2008 in the interest result, the earnings before tax and after tax, as well as in the balance sheet. The increase in the earnings before tax in 2008 will therefore be at a significantly disproportionately high rate to the increase in the operating result.
"We are keeping to our long-term objectives: growth averaging 10 percent per annum, sales of one billion euros in the long-term, with an EBIT margin of between 9 and 10 percent. To this end we have started up numerous initiatives throughout the Group which are geared towards our five value levers of growth, customer orientation, internationalization, employees & management and operational excellence", said Michael Mertin.
Additional information
The segments reflect the new organizational structure and in view of the different composition of the operational business cannot be compared with the old structures nor consequently with their key indicators for 2007.
You will be able to view the full 2007 Annual Report from 9 a.m. online at www.jenoptik.com under Accounts and Reports.
