COMET achieves marked double-digit growth, with improved profitability

Transcription

1 Press Release COMET achieves marked double-digit growth, with improved profitability F l a m a t t, Switzerland August 23, 2007 The COMET Group, a world-leading manufacturer of components and systems for the growth markets of security, inspection, electronics and communication, delivered record sales of CHF 58 million in the first half of 2007, an increase of 28% from the year-earlier level of CHF 45.1 million. This growth was driven by all markets and product segments (both OEM and the system business for end customers). Operating income (EBIT) was pushed up by 79% from CHF 2.0 million to CHF 3.6 million. Operating cash flow (EBITDA) was boosted by 34% from CHF 5.5 million to CHF 7.4 million. The acquisition of YXLON International Group Holding GmbH (YXLON) closed on July 19, 2007; these financial results for the first half of the year therefore still exclude the results of YXLON. Security & Inspection division The Industrial X-Ray business unit, with healthy growth of 15%, benefited from the worldwide upswing in the manufacturing sector and the successful launch of new products. This expansion was driven especially by the market segment of non-destructive testing and the success of integrated modules. The FEINFOCUS business unit, a specialist in microsystem applications, showed a welcome upward trend compared to the prior-year period. Thanks to the combination of restructuring measures and a flourishing electronics market, FEINFOCUS achieved growth of 47% from one year earlier. Net sales in the Security & Inspection division grew by 24% from CHF 24.8 million to CHF 30.6 million. Given the top-line growth coupled with cost-saving efforts, the division s EBIT improved by CHF 2.7 million (from a CHF 2.0 million deficit to a positive CHF 0.7 million). Operating cash flow (EBITDA) improved from CHF -0.2 million to CHF 2.3 million.

2 Electronics & Communication division The Vacuum Capacitors business unit again saw strong growth of 34%, fueled by the boom in the semiconductor industry during the first half of the year and by the market success of the ever-more-important module strategy. The business unit develops-to-order so-called match boxes that are of key importance in plasma production for coating and etching of semiconductor wafers. In the first half of 2007 these modules already accounted for 20% of sales. EBIT in this division, at CHF 4.5 million, again represented a disproportionately high fraction (16.4%) of total EBIT, even if the superb year-earlier result of CHF 5.2 million was not repeated. EBITDA eased by 18% year-over-year from CHF 6 million to CHF 4.9 million. Outlook For the second half of 2007, COMET continues to expect growth in all of the Group s business areas although the emerging temporary downturn in the semiconductor industry will slow growth in the Vacuum Capacitors unit. The sustained improvement at FEINFOCUS and the further launches of new products and applications in the Industrial X-Ray business unit should generate key contributions to revenue performance. For the full fiscal year 2007 as well, COMET s existing business (before YXLON) is thus expected to grow at a rate in the double digits. In the second half of the year, the recently acquired YXLON will be included in the COMET Group s consolidated results and will thus further strengthen EBITDA. Significant activity in the second half of the year is devoted to the integration of the YXLON acquisition. This includes the integration of the existing FEINFOCUS business unit in the future X-Ray Systems division and the consolidation of the distribution channels in the system activities. For further information, please contact Dr. Roland Zarske Chief Executive Officer T roland.zarske@comet.ch

3 COMET and YXLON have both been involved for decades in the market for non-destructive materials testing based on x-ray technology. While COMET has concentrated on the manufacture of high-tech components, which it has long supplied to YXLON, the latter is focused on providing entire systems, including software and service. The strong positions of COMET and YXLON in their respective markets mean the combined Group, as global market leader, will derive most benefit from the rapid growth of the non-destructive testing market. COMET was founded in 1948 and is based in Flamatt near Berne, Switzerland. COMET s stock (COTN) is listed on the SWX Swiss Exchange. Disclaimer This press release does not constitute an offer or invitation to subscribe for or purchase any securities. This press release does not constitute a prospectus within the meaning of Article 652a of the Swiss Code of Obligations or within the meaning of the listing rules of SWX Swiss Exchange. Investment decisions with regard to investments in the shares of Comet Holding AG should be based on the offering circular issued by Comet Holding AG in connection with the offering. A copy of the offering circular can be obtained free of charge in Switzerland at the offices of Bank Vontobel AG, Bahnhofstrasse 3, P.O. Box, CH-8022 Zürich, or can be ordered by telephone ( ), facsimile ( ) or (prospectus@vontobel.ch). This press release is not being issued in countries where the public dissemination of the information contained herein may be restricted or prohibited by law. In particular, this press release is not being issued in the United States of America and should not be distributed to United States persons or to publications with a general circulation in the United States. Any non-compliance with such restrictions may result in an infringement of United States securities laws. Securities of Comet Holing AG are not being publicly offered outside of Switzerland. In particular, the securities of Comet Holding AG have not been registered under the United States securities laws and may not be offered, sold or delivered within the United States or to U.S. persons absent registration under or an applicable exemption from the registration requirements of the United States securities laws.

4 Consolidated balance sheet in thousands of CHF ASSETS % Change Cash and cash equivalents 8,662 15,799-7,137 10,319 Trade and other receivables 21,279 16,577 4,702 14,967 Tax receivables Inventories 30,061 25,800 4,261 27,215 Prepaid expenses 2, , Total current assets 62, % 58, % 3,608 52,933 Property, plant and equipment 66,669 66, ,943 Investment properties ,914 Financial assets 2,625 2, ,464 Intangible assets 7,734 8, ,428 Deferred tax assets Total non-current assets 77, % 78, % ,235 TOTAL ASSETS 140, % 137, % 2, ,168 LIABILITIES AND SHAREHOLDERS EQUITY Current debt - 2,500-2,500 - Trade and other payables 10,691 10, ,122 Tax payables 605 1,741-1, Accrued expenses 5,943 4,726 1,217 4,764 Current provisions 1,435 1, , % 15.2% Total current liabilities 18,674 20,813-2,139 16,056 Long-term debt 30,000 27,500 2,500 30,000 Non-current provisions Deferred tax liabilities 2,130 2, , % 22.0% Total non-current liabilities 32,674 30,175 2,499 33, % 37.2% Total liabilities 51,348 50, ,635 Capital stock 6,017 6, ,000 Additional paid-in capital 26,558 25, ,252 Treasury stock Currency translation differences Retained earnings 56,990 55,106 1,884 53, % 62.8% Total shareholders equity 88,714 86,094 2,620 83, % 100.0% TOTAL LIABILITIES AND 140, ,082 2, ,168 SHAREHOLDERS EQUITY

5 Consolidated statement of income Change in thousands of CHF Six months ended June30 CHF thousands % Net sales 57,952 45,115 12,837 28% Cost of sales -34,761-26,870-7,891 29% Gross profit 23,191 18,245 4,946 27% Other operating income 2, , % Research and development expenses -6,452-4,544-1,908 42% Marketing and selling expenses -5,970-5, % General and administrative expenses -9,226-7,211-2,015 28% Operating income (EBIT) 3,635 2,034 1,601 79% Net financing expense % Income before tax 3,655 1,153 2, % Income tax % Net income 3, , % Amortization / depreciation 3,717 3, % EBITDA 7,352 5,472 1,880 34% Basic consolidated earnings per share % Consolidated statement of cash flows in thousands of CHF Change Six months ended June30 Cash flows from operating activities -3,175 2,325-5,500 Cash flows from investing activities -2,636-3, Cash flow from financing activities -1,200-1, Currency translation differences Net change in cash and cash -7,137-3,294-3,843 equivalents Cash and cash equivalents at January 1 15,799 13,613 2,186 Net change in cash and cash equivalents -7,137-3,294-3,843 Cash and cash equivalents at June 30, ,662 10,319-1,657

6 Consolidated statement of changes in equity in thousands of CHF Capital Additional Treasury Currency Retained Total stock paid-in capital stock translation earnings shareholders differences equity December 31, ,000 25, ,440 84,629 Currency translation differences Net income Total income and expenses Dividends paid -1,782-1,782 Capital increase Treasury stock transactions Stock-based compensation June 30, ,000 25, ,464 83,533 Capital Additional Treasury Currency Retained Total stock paid-in capital stock translation earnings shareholders differences equity December 31, ,000 25, ,107 86,094 Currency translation differences Net income ,084 3,084 Total income and ,084 3,127 expenses Dividends paid ,200-1,200 Capital increase Treasury stock transactions Stock-based compensation June 30, ,017 26, ,991 88,714

7 Notes to the consolidated financial statement 1 Significant accounting policies The unaudited half-year report for the six months ended June 30, 2007 has been prepared in compliance with Swiss stock corporation law and International Financial Reporting Standards (IFRS). All IFRS in force at the balance sheet date and all interpretations of the International Financial Reporting Interpretations Committee are applied. These consolidated financial statements are based on IAS 34, Interim Financial Reporting. Changes in reporting and valuation methods The present half-year report has been compiled using the same reporting and valuation methods as the consolidated financial statements at December 31, 2006, the only exception being the standards revised and extended as of January 1, 2007, which had no influence on the reporting and valuation of the present financial statements. The relevant revisions and new interpretations were as follows: - IFRS 7, Financial Instruments: Disclosure - IAS 1, Presentation of Financial Statements: Capital Disclosures - IFRIC 7, Applying the Restatement Approach under IAS 29 - IFRIC 8, Scope of IFRS 2 - IFRIC 9, Reassessment of Embedded Derivatives - IFRIC 10, Interim Financial Reporting and Impairment Basis of consolidation No acquisitions or disposals of businesses were made during the first half of The basis of consolidation has thus remained the same as in the annual accounts for the year ended December 31, Estimates The consolidated financial statements of COMET HOLDING AG, Flamatt, Switzerland, contain assumptions and estimates which affect the reported financial position, results of operations and cash flows. These assumptions and estimates were made on the basis of management s then-current best knowledge. Actual results could differ from the values reported. The following estimates have the greatest impact on the consolidated financial statements: Intangible assets: The valuation of goodwill and other intangibles, as well as the estimation of useful life, have an effect on the consolidated financial statements. Provisions: Provisions are recognized only if the specific criteria under IFRS are met. Nevertheless, provisions are based on assumptions which by their nature may later prove to be incorrect.

8 Contingent capital On April 28, 2005 the Ordinary Annual Shareholder Meeting authorized the creation of contingent capital with a par value of CHF 300,000 as payment in lieu of rights arising out of the employee stock compensation plan. On March 12, 2007 the Board of Directors authorized a capital increase through the issue of 30,000 new registered shares using the contingent capital. Application for listing of the new registered shares on the SWX Swiss Exchange was submitted and approved on April 26, As at June 1, 2007 a total of 1,658 shares from the contingent capital were issued in connection with the payment of bonuses relating to fiscal Change in contingent capital Status at December 31, Change + 16,580 Status at December June 30, ,580 in thousands of CHF Seasonality of business The business performance by segment as well as seasonal or cyclical fluctuation are described in the first part of the report. Foreign-currency translation The following exchange rates were used to translate the most important currencies into Swiss francs: Foreign-currency translation Rate at reporting Average rate for six date of June 30 months ended June USA USD Europe EUR China RMB Dividend payment A dividend of CHF 2.00 per shares was paid on May 4, 2007 (previous year: CHF 3.00). 3 Segment reporting The Group s two divisions Security & Inspection and Electronics & Communication form the primary segments for the purpose of segment reporting. Details on the course of business by segment are provided in the first part of the report. Net sales EBIT EBIT in % of sales in thousands of CHF Six months ended Six months ended Six months ended June 30 June 30 June Security & Inspection division 30,643 24, , % -8.0% Electronics & Communication 27,309 20,344 4,486 5, % 25.7% division Other and eliminations ,579-1,220 Total 57,952 45,115 3,635 2, % 4.5%

9 4 Events after the balance sheet date On June 1, 2007 COMET announced that it had acquired a 100% stake in the German company YXLON International Holding GmbH, Hamburg. The transaction was completed on July 19, An Extraordinary General Meeting, held on June 27, 2007, approved the creation of further authorized capital amounting to 120,000 shares which is to be used exclusively to finance the acquisition. The purchase price for YXLON International Holding GmbH is EUR 47.5 million, plus acquisition costs of around EUR 1.1 million. As the interim financial statements of YXLON Group at July 19, 2007 are not yet available, it is not possible to compare pre-acquisition IFRS values with IFRS values that take account of the purchase price allocation. A provisional calculation of the purchase price allocation shows that the following assets were acquired as part of the transaction: brands valued at EUR 2.0 million, technology at EUR 7.0 million, client lists at EUR 15.1 million and inventories at EUR 1.1 million. Additional liabilities and contingent liabilities valued at EUR 2.0 million were also identified. The initial assessment of intangible assets showed deferred tax liabilities of approximately EUR 7.9 million. The synergies arising from this transaction are expected to result in goodwill of around EUR 23.1 million. If this transaction had taken place on January 1, 2007, it would have generated additional income of CHF 2.3 million and additional net sales of approximately CHF 53.8 million. This would have resulted in pro-forma consolidated sales for the period ended June 30, 2007 of approximately CHF million and income of CHF 5.4 million. The transaction was financed by bank loans amounting to CHF 45.0 million and through a capital increase, effected through the issue of 145,000 registered shares at a placement price of CHF 288 per share. The gross revenue from the authorized capital increase was CHF 41.8 million.