MUNICH & WILMINGTON, Mass.--(BUSINESS WIRE)--In the last fiscal year, Osram benefited from persistently strong demand for its high-tech products, and particularly its opto-semiconductors. On a comparable basis (i.e. adjusted for portfolio and currency effects), revenue rose by just over 8 percent year on year to reach more than four billion Euro. The operating margin reached 16.8 percent, the EBITDA adjusted for special items was up by more than 6 percent to €695 million. Profit after tax came to €275 million. A dividend of €1.10 per share is to be proposed to the supervisory board. That means an increase by ten percent. Encouraging progress is being made with the 'Diamond' innovation and growth initiative, two years after it was launched. We are on track with our strategy. Despite negative currency effects and investments, Osram will continue to grow in 2018.
In the strong fourth quarter of fiscal year 2017 (ending September 30), the company registered significant increases in both revenue and earnings compared to the prior year while continuing with a program of capital spending. Osram's transition to a high-tech business will continue to feature strongly in fiscal year 2018. Optical semiconductor-based products already account for two thirds of the company's revenue. To lay the foundations for sustained profitable growth, Osram is investing around the world in its locations and technologies. This expenditure as well as headwinds from currency trends will be dominant factors in the current fiscal year.
Outlook for fiscal year 2018
In fiscal year 2018, Osram will continue to build on its foundations for the future. Revenue is expected to increase by between 5.5 and 7.5 percent. The EBITDA adjusted for special items is likely to be around €700 million and will be influenced by factors such as currency effects, ramp up costs for Kulim and increased capital expenditure on research and development which in total sums up to a three digit million Euro amount. The currency effects alone have a negative impact of roughly €70 million. Diluted earnings per share is expected to be between €2.40 and €2.60. We are expecting a free cash flow between minus €50 million and minus €150 million. The Managing Board is confident about Osram's positive medium-term prospects and is therefore aiming for a dividend of at least €1.10 per share once again in fiscal year 2018.
Trends in the segments
The growth trends and operational strength of Osram's Opto Semiconductor (OS) segment remain undiminished. The start-up costs related to the Kulim plant, together with currency effects, will impact on the operating margin in fiscal year 2018. Specialty Lighting (SP) is expanding because of the increased use of LEDs in the automotive sector. The Asia region delivered the highest rate of growth recently. The performance of Lighting Solutions & Systems (LSS) remains unsatisfactory. The Managing Board has taken action and with a new management team is exploring all options for the luminaires business (LS). There will be a strategic decision in the current fiscal year.
Planned joint venture with Continental in the preparation stage
Osram and Continental took a major step forward in their planned alliance in the automotive sector by setting out the key financial parameters. Revenue in the mid-triple-digit millions of euros is the initial target for the 50:50 joint venture, which is called Osram Continental GmbH. After launching in fiscal year 2018, the joint venture will operate in the market as an independent company and will be fully consolidated in Osram's financial statements. All that is now needed is the signing of final contracts and the required anti-trust authorizations to be issued.
The joint venture will combine innovative lighting technologies with electronics and software, and will develop, manufacture, and market intelligent lighting solutions for the automotive industry and set makers. Today, lighting and electronics in the automotive market are becoming increasingly integrated: Sensors, for example, are now able to scan oncoming traffic and partially dip the headlamps so that drivers using full beam do not dazzle other road users; Osram's infrared sensor lights are also used by a number of driver assistance systems.
Osram will hold its annual press conference featuring the Managing Board of OSRAM Licht AG on Tuesday, November 7, starting at 9 a.m. CET. The conference will be broadcast online at www.osram-group.de/de-DE/media/download-center/media-kits/mk-2017. A recording will be made available there afterwards.
You can follow the Managing Board's conference for analysts, which starts at 3 p.m. CET on Tuesday, at http://services.choruscall.eu/links/osram171107ir.html.
The annual report of OSRAM Licht AG will be published on November 30 in the investor relations section of the company's website at www.osram-group.com/en/investors/publications/2017.
Selected key figures for the OSRAM Light Group (continuing operations) in the fourth quarter. |
|||||||||||||||
Q4
2017 |
Q4
2016 |
Change
nominal |
|||||||||||||
Revenue | 1,029 | 909 | 13.2% | ||||||||||||
EBITDA | 118 | 125 | (5.5%) | ||||||||||||
…margin | 11.4 | 13.7 | (230bps) | ||||||||||||
Adjusted EBITDA1 | 160 | 131 | 21.8% | ||||||||||||
…margin | 15.5 | 14.4 | 110bps | ||||||||||||
Profit after tax | 40 | 44 | (10%) | ||||||||||||
Free Cash Flow | (28) | 30 | n.a. | ||||||||||||
‘000 Employees | 26.4 | 24.6 | 7% |
(Provisional, unaudited figures. Items stated in € million, margin in %,
employees as at September 30. Negative values in brackets.)
(1Adjustment
for special items (S.I.) includes e.g. transformation costs, substantial
legal and regulatory matters, and costs related to mergers and
acquisitions activities.
Segments Q4 |
|||||||||||||||
Q4
2017 |
Q4
2016 |
change
nominal |
|||||||||||||
Opto Semiconductors2 | |||||||||||||||
…Revenue | 429 | 372 | 15.3% | ||||||||||||
…EBITDA | 121 | 94 | 28.3% | ||||||||||||
…adjusted EBITDA | 121 | 94 | 28.3% | ||||||||||||
Specialty Lighting2 | |||||||||||||||
…Revenue | 551 | 495 | 11.4% | ||||||||||||
…EBITDA | 65 | 55 | 18.6% | ||||||||||||
…adjusted EBITDA | 71 | 58 | 23.5% | ||||||||||||
Lighting Solutions & Systems | |||||||||||||||
…Revenue | 242 | 258 | (5.9%) | ||||||||||||
…EBITDA | (37) | 4 | n.a. | ||||||||||||
…adjusted EBITDA | (7) | 6 | n.a. |
(Provisional, unaudited figures. Items stated in € million, margin in %,
employees as at September 30. Negative values in brackets.)
(2
Beginning with fiscal year 2017, certain external revenue in the
automotive sector, yet reported in the OS segment, are reported at SP.
Instead, OS now reports intersegment revenue (eliminated within the
corporate consolidation). Prior-year figures were adjusted accordingly.)
Selected key figures for the OSRAM Light Group (continuing operations) in FY 2017 |
|||||||||||||||
FY
2017 |
FY
2016 |
Change
nominal |
|||||||||||||
Revenue | 4,128 | 3.785 | 9.1% | ||||||||||||
EBITDA | 621 | 621 | 0% | ||||||||||||
…Margin | 15.1 | 16.4 | (140bps) | ||||||||||||
adjusted EBITDA | 695 | 652 | 6,6% | ||||||||||||
…Margin | 16.8 | 17.2 | (40bps) | ||||||||||||
Profit after tax | 275 | 532 | (48.3%) | ||||||||||||
Free Cash Flow | 99 | 24 | 316% | ||||||||||||
‘000 Employees | 26.4 | 24.6 | 7% |
(Provisional, unaudited figures. Items stated in € million, margin in %, employees as at September 30. Negative values in brackets.)
Segments FY 2017 |
|||||||||||||||
FY
2017 |
FY
2016 |
Change
nominal |
|||||||||||||
Opto Semiconductors2 | |||||||||||||||
Revenue | 1,685 | 1,417 | 18.9% | ||||||||||||
…EBITDA | 473 | 408 | 15.9% | ||||||||||||
…adjusted EBITDA | 473 | 408 | 15.9% | ||||||||||||
Specialty Lighting2 | |||||||||||||||
Revenue | 2,312 | 2,135 | 8.3% | ||||||||||||
…EBITDA | 317 | 292 | 8.6% | ||||||||||||
…adjusted EBITDA | 339 | 305 | 11.3% | ||||||||||||
Lighting Solutions & Systems | |||||||||||||||
Revenue | 989 | 1.005 | (1.5%) | ||||||||||||
…EBITDA | (72) | 6 | n.a. | ||||||||||||
...adjusted EBITDA | (21) | 16 | n.a. |
(Provisional, unaudited figures. Items stated in € million, margin in %,
employees as at September 30. Negative values in brackets.)
(2
Beginning with fiscal year 2017, certain external revenue in the
automotive sector, yet reported in the OS segment, are reported at SP.
Instead, OS now reports intersegment revenue (eliminated within the
corporate consolidation). Prior-year figures were adjusted accordingly.)
ABOUT OSRAM
OSRAM, based in Munich, is a leading global
high-tech company with a history dating back more than 110 years.
Primarily focused on semiconductor-based technologies, our products are
used in highly diverse applications ranging from virtual reality to
autonomous driving and from smart phones to smart and connected lighting
solutions in buildings and cities. OSRAM uses the endless possibilities
of light to improve the quality of life for individuals and communities.
OSRAM’s innovations enable people all over the world not only to see
better, but also to communicate, travel, work and live better. OSRAM has
approximately 26,400 employees worldwide as of end of fiscal 2017
(September 30) and generated revenue of more than €4.1 billion. The
company is listed on the stock exchanges in Frankfurt and Munich (ISIN:
DE000LED4000; WKN: LED400; trading symbol: OSR). Additional information
can be found at www.osram.com.
Disclaimer
This document contains statements and information
pertaining to our future business and financial performance and future
developments that may constitute forward-looking statements – i.e.
statements about processes that take place in the future, not in the
past. These statements pertaining to the future can be identified by
expressions such as "anticipate", "expect", "want", "intend", "plan",
"believe", "aspire", "estimate", "will”, "predict" or words of similar
meaning. Such statements are based on current expectations and certain
assumptions of OSRAM’s management. They are, therefore, subject to
certain risks and uncertainties. A variety of factors, many of which are
beyond OSRAM’s control, affect OSRAM’s operations, performance, business
strategy and results and could cause the actual results, performance or
achievements of OSRAM to be materially different from any future
results, performance or achievements that may be expressed or implied by
such forward-looking statements or anticipated on the basis of historic
trends. These factors include in particular, but are not limited to, the
matters described in the chapter “Report on Risks and Opportunities” in
the Annual Report of OSRAM Licht Group. Should one or more of these
risks or uncertainties materialize, or should underlying assumptions
prove incorrect, actual results, performance or achievements of OSRAM
may vary materially from those described in the relevant forward-looking
statement as being expected, anticipated, intended, planned, believed,
sought, estimated or projected. OSRAM neither intends, nor assumes any
obligation, to update or revise these forward-looking statements in
light of developments which differ from those anticipated. Due to
rounding, numbers presented throughout this and other documents may not
add up precisely to the totals provided and percentages may not
precisely reflect the absolute figures they reference.