MEMSCAP Earnings for Fiscal Year 2016: Third Consecutive Profitable Year

EBITDA at EUR. 1.2 million & Net cash increase by EUR 0.6 million

GRENOBLE, France & DURHAM, N.C.--()--Regulatory News:

MEMSCAP (Paris:MEMS), the leading provider of innovative solutions based on MEMS (micro-electro-mechanical systems) technology, today announced its earnings for fiscal year 2016 ending December 31, 2016.

Analysis of the consolidated income statement

Matching previous quarterly press releases, revenue for FY 2016 amounted to EUR 11.7 million (US$ 12.9 million). Consolidated revenue distribution by market segment over FY 2016 is as follows:

Market segments   Revenue (M€)   %
Aerospace   5.6   48%
Optical Communications / Adaptive Optics 3.9 33%
Medical / Biomedical 1.4 12%
Mass Market 0.8 7%
Total   11.7   100%

(Any apparent discrepancies in totals are due to rounding.)

MEMSCAP consolidated earnings for FY 2016 are given by the following table:

(In million euros)  

For the year ended

31 December 2016

 

For the year ended

31 December 2015

Revenue

- Standard products*

- Custom products

 

11.7

7.0

4.7

 

12.6

7.5

5.1

Gross margin

3.8

4.6

Operating expenses**

(3.8)

(3.8)

Operating profit / (loss)

0.0

0.8

Financial profit / (loss)

0.1

(0.1)

Net profit / (loss)   0.1   0.7

(Financial data were subject to an audit by the Group’s statutory auditors who will issue their reports at a later date. On March 17st, 2017, the MEMSCAP board of directors authorized the release of the FY 2016 consolidated financial statements. Any apparent discrepancies in totals are due to rounding.)

* Including the royalties from the dermo-cosmetics segment.
** Net of research & development grants.

The Group was confronted in 2016 to a weaker demand on the medical and biomedical market segment, partially offset by the dynamism of the optical communications and avionics activities. This change in volumes resulted in a gross margin rate at 32% of consolidated sales compared with 37% for the previous year. The consolidated gross margin therefore stood at EUR 3.8 million, compared with EUR 4.6 million for FY 2015.

Operating expenses (net of research & development grants) for FY 2016 were at a similar level than FY 2015 and amounted to EUR 3.8 million.

In 2016, the Group therefore reported break-even operating earnings compared to an operating profit of EUR 0.8 million euros for FY 2015.

The financial profit for FY 2016 amounted to EUR 0.1 million compared to a financial loss of EUR 0.1 million for FY 2015. This profit mainly included foreign exchange gains on Group’s sales for EUR 0.1 million (FY 2015: Foreign exchange losses of EUR 0.1 million).

Finally, the net profit for FY 2016 amounted to EUR 0.1 million compared to a net profit of EUR 0.7 million for FY 2015.

Net cash increase of EUR 0.6 million over FY 2016

The positive operating cash flow amounted to EUR 1.2 million for FY 2016 compared to EUR 1.5 million for FY 2015. At December 31, 2016, consolidated available cash was EUR 4.2 million including cash and short term deposits as well as cash investments (Corporate bonds) recorded under financial assets available for sale. In addition to this amount, the available unused credit lines amounted to EUR 0.4 million at December 31, 2016.

At December 31, 2016, net cash was EUR 2.8 million increasing by EUR 0.6 million compared to the net cash position at December 31, 2015.

MEMSCAP shareholder’s equity totaled EUR 18.6 million at December 31, 2016.

Analysis and perspectives

The year 2016 marks the third consecutive financial year of profitability of the Group combined with a significant increase in net cash. These performances materialized the MEMSCAP’s sales strategy initiated in 2013, focusing on high-value markets and productivity gains within the Group's production entities.

Over the year 2017, MEMSCAP intends to optimize its industrial organization in order to increase the flexibility of its production capacities. At the same time, the Group will accelerate its disengagement from low-margin services activities in favor of the development of its intellectual property driven activities. This evolution, while potentially impacting the Group's profitability in the short term, should enable MEMSCAP to significantly increase its margins over the coming years.

Q1 2017 earnings: April 21, 2017

Annual meeting of shareholders: May 23, 2017

About MEMSCAP

MEMSCAP is the leading provider of innovative micro-electro-mechanical systems (MEMS)-based solutions. MEMSCAP standard and custom products and solutions include components, component designs (IP), manufacturing and related services. MEMSCAP customers include Fortune 500 businesses, major research institutes and universities. The company's shares are traded on the Eurolist of NYSE Euronext Paris S.A (ISIN: FR0010298620-MEMS) and belong to the CAC small, CAC Mid & Small, CAC All-Tradable and CAC All-Share indexes. More information on the company's products and services can be obtained at www.memscap.com.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

at 31 December 2016

  31 December
2016
  31 December
2015
€000 €000
Assets
Non-current assets
Property, plant and equipment 2 856 3 151
Goodwill and intangible assets 8 485 8 254
Available-for-sale financial assets 1 332 1 265
Other non-current financial assets 46 --
Employee benefit net asset 72 --
Deferred tax asset 1 162 1 103
13 953 13 773
Current assets
Inventories 2 926 2 793
Trade and other receivables 2 456 2 051
Prepayments 276 138
Other current financial assets 12 --
Cash and short-term deposits 2 824 2 636
8 494 7 618
   
Total assets 22 447 21 391
 
 
Equity and liabilities
Equity
Issued capital 1 782 1 782
Share premium 18 624 18 675
Treasury shares (121) (133)
Retained earnings (29) (394)
Foreign currency translation (1 649) (2 168)
18 607 17 762
Non-current liabilities
Interest-bearing loans and borrowings 732 1 068
Employee benefit liability 4 54
736 1 122
Current liabilities
Trade and other payables 2 384 1 883
Interest-bearing loans and borrowings 412 451
Other current financial liabilities 230 95
Provisions 78 78
3 104 2 507
 
Total liabilities 3 840 3 629
Total equity and liabilities 22 447 21 391

CONSOLIDATED STATEMENT OF INCOME

For the year ended 31 December 2016

  2016   2015
€000 €000
Continuing operations
 
Sales of goods and services 11 714 12 623
Revenue 11 714 12 623
 
Cost of sales (7 938) (8 009)
Gross profit 3 776 4 614
 
Other income 315 503
Research and development expenses (1 387) (1 673)
Selling and distribution costs (808) (783)
Administrative expenses (1 882) (1 851)
Operating profit / (loss) 14 810

Finance costs

(62)

(207)

Finance income 156 61
Profit / (loss) for the year from continuing operations before tax 108 664

Income tax expense

--

--

   
Profit / (loss) for the year from continuing operations 108 664
   
Profit / (loss) for the year 108 664
 
Earnings per share:
 

- Basic, for profit / (loss) for the year attributable to ordinary equity
holders of the parent (in euros)

€ 0.02

€ 0.09

- Diluted, for profit / (loss) for the year attributable to ordinary equity
holders of the parent (in euros)

€ 0.01

€ 0.09

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the year ended 31 December 2016

  2016   2015
€000 €000
   
Profit / (loss) for the year 108 664
 
Items that will not be reclassified subsequently to profit or loss
Actuarial gains / (losses) 115 129
Income tax on items that will not be reclassified to profit or loss -- --
Total items that will not be reclassified to profit or loss 115 129
 
Items that may be reclassified subsequently to profit or loss
Net gain / (loss) on available-for-sale financial assets 33 (12)
Hedging instruments (124) 319
Exchange differences on translation of foreign operations 519 (196)
Income tax on items that may be reclassified to profit or loss -- --
Total items that may be reclassified to profit or loss 428 111
   
Other comprehensive income for the year, net of tax 543 240
   
Total comprehensive income for the year, net of tax 651 904

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the year ended 31 December 2016

 

(In thousands of euros, except for

 

Number

 

Issued

 

Share

 

Treasury

 

Retained

 

Foreign

 

Total

number of shares) of shares capital premium shares earnings currency translation shareholders’ equity
€000 €000 €000 €000 €000 €000
 
At 1 January 2015 7 089 215 1 772 18 771 (117) (1 656) (1 972) 16 798

Profit for the year

--

--

--

--

664

--

664

Other comprehensive income for the period, net of tax -- -- -- -- 436 (196) 240
Total comprehensive income -- -- -- -- 1 100 (196) 904
 
Capital increase 39 471 10 43 -- -- -- 53
Retained earnings offset with share premium -- -- (139) -- 139 -- --
Treasury shares -- -- -- (16) -- -- (16)
Share-based payment -- -- -- -- 23 -- 23
 
At 31 December 2015 7 128 686 1 782 18 675 (133) (394) (2 168) 17 762
 
At 1 January 2016 7 128 686 1 782 18 675 (133) (394) (2 168) 17 762

Profit for the year

--

--

--

--

108

--

108

Other comprehensive income for the period, net of tax -- -- -- -- 24 519 543
Total comprehensive income -- -- -- -- 132 519 651
 
Transfer to the reserves not available for distribution -- -- (51) -- 52 -- 1
Treasury shares -- -- -- 12 -- -- 12
Share-based payment -- -- -- -- 181 -- 181
 
At 31 December 2016 7 128 686 1 782 18 624 (121) (29) (1 649) 18 607

CONSOLIDATED CASH FLOW STATEMENT

For the year ended 31 December 2016

  2016   2015
€000 €000
Cash flows from operating activities:    
Net profit / (loss) for the year 108 664
Non-cash items written back:
Amortization and depreciation 935 836
Loss / (capital gain) on disposal of fixed assets 23 12
Other non-financial activities 162 (96)
Accounts receivable (217) 547
Inventories 11 (23)
Other debtors (46) (121)
Accounts payable 123 (221)
Other liabilities 114 (106)
Total net cash flows from operating activities 1 213 1 492
 

Cash flows from investing activities:

Purchase of fixed assets (416) (288)
Proceeds from sale / (purchase) of financial assets (46) (16)
Total net cash flows from investing activities (462) (304)
 

Cash flows from financing activities:

Proceeds from borrowings 290 --
Repayment of borrowings (622) (522)
Payment of finance lease liabilities (146) (114)
Sale / (purchase) of treasury shares 11 (16)
Proceeds from issue of shares -- 53
Change in restricted cash (58) --
Total net cash flows from financing activities (525) (599)
 

Net foreign exchange difference

(38)

88

 
Increase / (decrease) in net cash and cash equivalents 188 677
Opening cash and cash equivalents balance 2 636 1 959
Closing cash and cash equivalents balance 2 824 2 636

Contacts

MEMSCAP
Yann Cousinet
CFO
Ph: +33 (0) 4 76 92 85 00
Email: yann.cousinet@memscap.com

Contacts

MEMSCAP
Yann Cousinet
CFO
Ph: +33 (0) 4 76 92 85 00
Email: yann.cousinet@memscap.com