The Styrian chip and sensor manufacturer AMS, which has recently acquired 71 percent of Osram, plans to integrate the German lighting group quickly. A domination and profit transfer agreement (BGV) should be implemented by the end of the year in order to create a clearly profitable joint company in the coming years.
Based on its majority stake, they are now starting to work more closely with Osram, for example with a view to preparing the future organizational and business structure. AMS also plans to take four seats on the Osram Supervisory Board.
The Munich lighting manufacturer will remain an independent listed subsidiary until further steps – such as the domination and profit transfer agreement – have been completed and implemented. AMS said that future excess cash from operating activities would be used to further increase Osram’s stake.
AMS increased operationally in the second quarter: operating income increased to $ 39.2 (21.5) million year-on-year in the second quarter and to $ 98.9 (17.1) million in the half year. The financial result was strongly negative – $ 32.2 (5.0) million in the second quarter and $ -105.0 (2.2) million in the first half.
Nevertheless, AMS made it back to the bottom line in the second quarter, after a $ 17 million drop by March. After-tax earnings of $ 5.9 million remained in the second quarter, though significantly less than a year earlier ($ 24.7 million). However, due to the negative first quarter, losses for the entire first half of the year were $ 9.8 million, after $ 15.5 million earnings after taxes from January to June 2019.
The situation at Osram is different:
Osram: Deep red numbers in the third quarter >>
Revenues this year were $ 460.3 million, 13 percent higher than a year earlier ($ 407.3 million) in the second quarter, and continued to grow strongly in the first half (960.9 after 785.8 million). Sales in the second quarter were in the middle of the expected range and profitability (EBIT margin) at the upper end of the expected range, AMS said.
Adjusted operating profit (EBIT) for the second quarter was $ 90.1 million, or 20 percent of sales (before acquisition and share-based compensation expense), a significant increase from the $ 49.0 million a year earlier, according to AMS (or 39.2 million, or 9 percent of sales, including acquisition-related expense and share-based compensation expense, up from the $ 21.5 million in the second quarter of 2019).
Adjusted EBIT for the half year was $ 191.0 million this year (before acquisition-related expense and expense for share-based compensation), a strong increase compared to 71.8 million in the same period last year (99.0 million incl. Acquisition-related expense and expense for share-based compensation) Compensation, up $ 17.1 million in the year-ago period).
Despite the sluggishness in the auto industry, AMS continues to spread confidence for the current third quarter: The continuing consumer demand is said to compensate for the weakness in the automotive and industrial markets. Thanks to the ramp-up of the production of smartphone sensors, sales will be between $ 530 and $ 570 million, 20 percent higher than in the second quarter. Adjusted operating return on sales (EBIT margin) should rise to 21 to 24 (second quarter: 20) percent. Osram figures are not yet included in the forecast, although the lighting group has been part of the group since July 9th. (apa / red)