Melexis Q4 and FY 2019 results - Full year sales of 486.9 million EUR

Intermediate declaration by the Board of Directors
Ieper, Belgium – February 5th, 2020, 07.00 hrs CET

YoY growth 2018 versus 2019 - Melexis

For the full year 2019, sales were 486.9 million EUR, a decrease of 14% compared to the previous year.
The EUR/USD exchange rate evolution had a positive impact on sales of 2% compared to 2018.
The gross result was 196.2 million EUR or 40.3% of sales, a decrease of 25% compared to 2018.
R&D expenses were 16.3% of sales, G&A was at 6.3% of sales and Selling was at 3.2% of sales.
The operating result was 70.6 million EUR or 14.5% of sales, a decrease of 49% compared to 138.5 million EUR last year.
The net result was 60.3 million EUR or 1.49 EUR per share, a decrease of 48% compared to 115.5 million EUR or 2.86 EUR per share in 2018.

Q4 YoY growth 2018 versus 2019 - Melexis

Sales for the fourth quarter of 2019 were 127.1 million EUR, a decrease of 10% compared to the same quarter of the previous year and an increase of 3% compared to the previous quarter.
The EUR/USD exchange rate evolution had a positive impact on sales of 1% compared to the same quarter of last year and no impact compared to the previous quarter.
The gross result was 50.4 million EUR or 39.7% of sales, a decrease of 21% compared to the same quarter of last year and an increase of 2% compared to the previous quarter.
R&D expenses were 16.1% of sales, G&A was at 6.0% of sales and Selling was at 3.2% of sales.
The operating result was 18.3 million EUR or 14.4% of sales, a decrease of 43% compared to the same quarter of last year and an increase of 1% compared to the previous quarter.
The net result was 15.4 million EUR or 0.38 EUR per share, a decrease of 46% compared to 28.5 million EUR or 0.70 EUR per share in the fourth quarter of 2018 and a status quo compared to the previous quarter.

Dividend

The Board of Directors approved on January 31st, 2020 to propose to the Annual Shareholders meeting to pay out over the result of 2019 a total dividend of 2.20 EUR gross per share. This amount contains an interim dividend of 1.30 EUR per share which was paid in October 2019 and a final dividend of 0.90 EUR per share which will be payable after approval of the Annual Shareholders meeting.
The Melexis shares will start trading ex coupon on May 13, 2020 (opening of the market). The record date is May 14, 2020 (closing of the market) and the dividend will be payable as from May 15, 2020.

Outlook

Melexis expects sales in the first quarter of 2020 to be in the range of 134-138 million EUR, with a gross profit margin around 41% and an operating margin around 17% at the midpoint of the sales guidance.
For the full year 2020, Melexis expects sales growth around 10%, a gross profit margin around 41% and an operating margin around 17%, all taking into account a EUR/USD exchange rate of 1.10.

Business comment – Françoise Chombar, CEO:

“Melexis announces fourth-quarter and full-year results in line with our guidance, concluding a challenging year. Based on the latest data points, worldwide car sales dropped by around 5% in 2019, while Melexis sales were impacted almost threefold, fully attributable to inventory corrections at customers, triggered by an uncertain economic and geopolitical situation caused by global trade tensions. In this difficult market context, Melexis is happy to confirm and update its October 2019 announcement: inventory corrections are now over and customer order behavior further improved in the fourth quarter of 2019 and the beginning of the new year.
For 2020, Melexis is confident to provide a sales growth guidance of around 10%, based on continued weak global car sales – potentially below the 2019 level – on the negative side, but normalized order behavior and automotive semiconductor content growth on the positive.
The product lines clearly outperforming in 2019 were pressure sensors and temperature sensors, both posting double-digit sales growth. A continued stricter legislation, for example with respect to reducing pollution generated by gasoline fuel vapor, especially critical with hybrid vehicles, is and will continue to be a strong content growth driver for our pressure sensor product line. Next to addressing challenges in automotive electrification, pressure sensors are also increasingly embedded in motorbikes. Our temperature sensor product line, for example with the far infrared array technology, continues to gain traction in applications in adjacent markets such as energy management in buildings. In 2019, Melexis also launched the world's smallest medical-grade far infrared integrated sensor. Another product line set for growth is embedded lighting. Lighting is one of the key features for future personalization and differentiation within the driver’s cabin. In 2019, new products were also announced in our magnetic sensor product lines, optical sensors (time of flight) and embedded motor drivers. Melexis is well positioned to benefit from the increase of sensor and driver content in cars, surfing on the secular trends of more electrification, assisted drive and personalization. Sales to automotive customers represented 91% of total sales in the fourth quarter and 92% of sales in the full year 2019. The portion of standard product (ASSPs) sales represented 66% of total sales in the fourth quarter and 65% in the full year 2019.”

Financial comment – Karen Van Griensven, CFO:

“Gross and operating profit margin guidance reflects a continued low utilization of test capacity, balanced by good cost control. The combination of these effects results in a 250bp improvement of operating margin guidance versus 2019.”

The statutory auditor has confirmed that the audit, which is substantially complete, has not to date revealed any material misstatement in the draft consolidated accounts, and that the accounting data reported in the press release is consistent, in all material respects, with the draft accounts from which it has been derived.

Financial calendar
  • Publication Q1 Results 2020: April 29, 2020 (at 7 hrs CET)
  • Annual Shareholders Meeting: May 12, 2020
  • Dividend pay date: May 15, 2020 (ex coupon on May 13, 2020)
  • Publication Q2 Results 2020: July 29, 2020 (at 7 hrs CET)
  • Publication Q3 Results 2020: October 28, 2020 (at 7 hrs CET)
  • Publication FY 2020 Results: February 3, 2021 (at 7 hrs CET)

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