Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on AMS AG. We currently have 7 research reports from 1 professional analysts.
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Weak guidance, and an acquisition which supposes flawless execution
25 Oct 16
ams reported Q3 revenues of €146.7m, corresponding to a 10.8% increase sequentially but a 4.1% decrease yoy. The Products business line accounted for €131.7m (+9.3% sequentially, -7.5% yoy), leaving €15m to the Foundry business (+41.5% yoy). The adj. gross margin reached 55.4% (53% in IFRS), down 160bp yoy (130bp in IFRS); the adj. EBIT, came in at €28m (€49.7m in IFRS), for a margin of 19.1% (vs. 33.9% in IFRS), leading to a net result of €55.9m. For Q3, the company expects a muted quarter due to a negative development concerning a particular customer in the consumer end market and a production yield issue in an industrial product line, the latter unlikely to be solved before early 2017. This will lead to expected revenues of between €127m and €134m, while the customer-specific development may result in negative profitability effects due to depreciation of work-in-progress inventory, leading to an expected adj. EBIT margin of 11-13%. Moreover, the company announced the acquisition of Heptagon, a specialist in micro-optics and optical sensing solutions with particular expertise in high performance optical packaging. The transaction includes an upfront consideration in cash ($64m) and shares (shares currently held in treasury combined with a 15% capital increase), for a total of $570m, as well as an earn-out consideration subject to future results but potentially as high as $285m. This takes the company’s potential value to $855m, i.e. 9.5x the current TTM revenues of $90m. These revenues are associated with negative profitability, which is expected to disappear following a capacity increase funded by $250m of existing cash and triggered by a specific customer commitment starting next year. The combination of the two activities is expected to result in a 30% CAGR for the coming three years with a profitability target of 30% EBIT margin from 2019; the deal is expected to close by early 2017.
Signs of stabilisation
26 Jul 16
ams reported Q2 revenues of €132m, corresponding to a 3.4% decrease sequentially and 21.9% yoy. The Products business line accounted for €120.5m (-5.5% sequentially, -23.6% yoy), leaving €11.9m to the Foundry business (flat yoy). The gross margin reached 53.4%, down by 100bp yoy; EBIT, excluding acquisition-related costs, came in at €24.4m, for a margin of 18.4% (vs. €16.7m and 12.6% including these costs), leading to a net result of €19.6m. The company also announced the acquisition of the colour and spectral sensing systems specialist MAZeT, based in Germany and employing 80 people, for an undisclosed amount in cash. The company had also acquired during the quarter Cambridge CMOS Sensors (CCMOSS), a specialist in gas and infrared sensors, based in Cambridge and employing 33 people, once again for an undisclosed amount in cash. For Q3, the company expects positive momentum in the consumer business, which will lead to expected revenues of between €146m and €153m (vs. €153m in Q3 15). The adjusted gross margin should remain at a comparable or slightly lower level to Q2, while EBIT excluding acquisition-related costs should be in the 18-20% range. 2016 capex is expected above €80m to support the expected customer uptake of the latest generation of sensors.
2016 likely to be a blank year
26 Apr 16
ams reported Q1 revenues of €137m, corresponding to a 6.9% decrease sequentially and 10.6% yoy. The Products business line accounted for €127.5m (-6.4% sequentially, -10.7% yoy), leaving €9.5m to the Foundry business (-9.1% yoy). The gross margin reached 53.9%, down by 50bp yoy; EBIT, excluding acquisition-related costs, came in at €28.2m, for a margin of 20.6% (vs. 14.4% including these costs), leading to a net result of €13.6m. For Q2, the company expects significant volatility in the consumer market supply chain, as well as unfavorable currency effects, which will lead to expected revenues of between €127m and €134m. The gross margin should remain at a comparable level with Q1, while EBIT excluding acquisition-related costs should be in the 17-19% range.
Soft market conditions to hamper H1 performance
02 Feb 16
ams reported Q4 revenues of €147m, corresponding to a 5.9% growth yoy but to a 3.8% decrease sequentially. The Products business line accounted for €136m (-4.4% sequentially, +5% yoy), leaving €11m to the Foundry business (+18% yoy). The gross margin reached 54.6%, slightly increasing from the previous quarters; EBIT, excluding acquisition-related costs, came in at €33.7m, for a margin of 22.8% (vs. 19.9 % including these costs), leading to a net result of €31m. For the full year, revenues increased by 34.2% at €623m, for a stable gross margin of 54.4% (including acquisition-related costs) and an operating profit of 23.5% also including these costs. For Q1, the company expects weaker demand due to traditional seasonality and softer market conditions in the consumer space, leading to revenues expected between €131-138m, while the gross margin should remain stable; the operating margin is expected between 18% and 20%. For the full year, the company is expecting its top-line to show some growth.
A positive further move in the CMOS sensor space
20 Nov 15
ams has announced the acquisition of CMOSIS, a fabless provider of sensor and analog solutions for machine vision, medical, photographic and scientific imaging. The company is present in Belgium, Germany, Portugal and the US, and has more than 110 employees. The price paid is €217m, with 2015 revenues expected at around €60m and to be growing next year. The operating profitability is higher than ams’. The transaction will be funded through existing cash and credit lines, no additional financing being required, and is expected to close within the next six weeks.
Soft guidance and uncertainties on NFC licensing
27 Oct 15
ams reported Q3 revenues of €153m, corresponding to a 15.2% growth yoy but to a 9.8% decrease sequentially. The Products business line accounted as usual for most of the top-line with €142m (-9.7% sequentially, +15.8% yoy), leaving €11m to the Foundry business (+8% yoy). The gross margin reached 54.3%, stable compared to the three previous quarters; EBIT excluding acquisition-related costs came in at €37m, for a margin of 24.8% (23% including these costs), leading to a net result of €34m. For Q4, the company expects softer demand, in both the consumer and non-consumer markets, and is expecting revenues between €137m and €142m, a stable gross margin but lower operating profitability due to heavy R&D investments.
A data-driven H1 raises expectations
05 Dec 16
The first reporting period under the new D4t4 Solutions brand saw the group (previously IS Solutions) deliver good growth, leaving it well on track to meet PBT forecasts in FY 2017, and we now increase FY 2018 forecasts. The business continues to flourish from its focus on data management and analytics, enabling its international blue-chip client base to gather and gain advantage from the mass of customer data available, utilising the leading-edge Celebrus solution. Industry analysts predict 12% CAGR for the BI & Analytics market through to 2020, and D4t4 is riding this wave of demand.
08 Dec 16
Elderstreet stake acquired 02 GENERAL NEWS Globalworth premium In this issue Venture capital firm Draper Esprit has taken a 30.8% stake in venture capital trust manager Elderstreet. Both investment managers focus on the technology sector and they will be able to co-invest. Elderstreet has investments in a number of AIM-quoted companies through its VCTs. The purchase was funded by an issue of Draper Esprit shares worth just over £250,000. Simon Cook, the chief executive of Draper Esprit, is a former partner at Elderstreet so he knows the business and the people who run it, although he did leave more than 14 years ago. Cook has previously acquired portfolios from 3i and Cazenove, two other firms where he has worked. Draper Esprit has an option to acquire the remaining shares in Elderstreet, which has more than £25m under management. Adding Elderstreet to the group enables Draper Esprit to offer investors a range of EIS funds, VCTs and an ISA qualifying listed evergreen patient capital fund. The enlarged group has venture capital assets under management of more than £350m. At the end of September 2016, Draper Esprit had a net asset value of 352p a share, which is similar to the current share price. The June 2016 flotation price was 300p a share. Draper Esprit is quoted on Ireland’s Enterprise Securities Market as well as AIM.
06 Dec 16
600 Group* (SIXH): Interim results: order book showing signs of improvement (CORP) | Real Good Food* (RGD): Commodity volatility impacts numbers (CORP) | Minds + Machines* (MMX): .vip goes live in China (CORP | Imaginatik* (IMTK): Interims (CORP) | iomart* (IOM): Quality business as usual (CORP) | Fulcrum (FCRM): Upgrades continue (BUY)
N+1 Singer - Morning Song 05-12-2016
05 Dec 16
RTHM is acquiring a profitable Canadian listed mobile specialist for equivalent of US$42.5m consideration in shares (88.235m). This helps adds to two growth vectors RTHM is targeting; (i) adds unique exclusive audience (10m unique) and (ii) Exclusive demand Yahoo and Facebook. The business has 15 premium and owned and operated apps which provide users with rewards for activity. The business is expected to deliver c$9m of EBITDA in FY18 including $2m of cost synergies. This equates to just 4.7x EV/EBITDA. This marks what we see the first step in RTHM activity to scale the business and deliver on margin potential (see our initiation notes). Our initial estimates for EPS revisions are very significant - for FY18 are 2.3 cents (currently 0.6) and for FY19 4.3 (currently 2.5). There is a call at 830 for investors and we will revise post this.
Taking a prudent road
28 Nov 16
As flagged in September, H1 2017 profit is indeed below LY; adj. PBT of £0.5m compares with £1.5m in H1 2016 as Trakm8 invests heavily in new technology and acquisition integration. Management remains confident in another very strong H2 performance and in particular is focused on closing a couple of large high-margin software-related sales which would see the group meeting the original FY 2017 expectations of £5.9m adj. PBT. However, should these fall outside the March year-end, profits are only likely to be in line with last year’s £3.9m, albeit on a growing revenue base. Prudence dictates we assume a worst-case scenario in our forecasts so that surprise is only in the upside – if the deals close in the year, the company will meet those original revenue and profit expectations.
Joy of Techs
21 Nov 16
ICT evolution is driven by technological development as advances are made which both meet and shape customer requirements. Our 2011 note No such thing as a telco described the modern reality in that former ‘telcos’ now deliver varying elements of a range of managed services. We built on this theme last year, exploring in further detail their evolutionary paths, operating fundamentals, and cashflow yield similarities. In the consumer environment, demand for bundles of technology is complemented by demand for content. Across the pond, the mooted combination of AT&T and Time Warner typifies the bundled need of ‘pipe’ and content, since unbundled alternatives such as FaceTime and WhatsApp can be easier and clearer to chat over, and Amazon and Netflix are easier to watch anywhere. In the UK, BT’s defensive actions cover delivery, content and capabilities, acquiring EE yet also buying football rights. While TV was long ago added to triple play to become quad play, voice is now merely an app, and fixed and mobile seen as just dumb pipes: it's the content that will influence consumer choices. Growth of TV and film as well as music and gaming over IP leads to UK small cap opportunities. In context of the drive to maximise value from pipes and access by offering content and data, we look at some amongst the potential tech small cap beneficiaries: Amino*, Keyword Studios, ZOO Digital*, 7digital*, KCOM* and CityFibre*.