Confirmation of the Profitable Growth
Profile
- 55.6% growth in half-year revenue
- Strong momentum across all Group's businesses
- Half-year adjusted1 EBITDA of EUR 1,677 thousand (23.7%
of revenue)
- Half-year operating profit of EUR 1,158 thousand (16.3%
of revenue)
- Consolidated half-year net profit of EUR 1,134 thousand
euros (16.0% of revenue)
- Consolidated available cash at EUR 4,832 thousand as of
June 30, 2023
- Signature of the first contract for engine control
applications for aerospace
- Confirmation of MEMSCAP profile shift: a solid model of
profitable growth
- Growth and profitability momentum expected to continue in
the second half of 2023
Regulatory News:
MEMSCAP (Euronext Paris: MEMS), leading provider of
high-accuracy, high-stability pressure sensor solutions for the
aerospace and medical markets using MEMS technology (Micro Electro
Mechanical Systems), today announced its earnings for the first
half of 2023 ending June 30, 2023.
Analysis of consolidated revenue
In accordance with the previous quarterly press releases,
consolidated revenue from continuing operations for the first half
of 2023 amounted to EUR 7,089 thousand compared to EUR 4,555
thousand for the first half of 2022.
Over the first half of 2023, the distribution of consolidated
revenue from continuing operations by market segment is as
follows:
Market segments / Revenue (In
thousands of euros)
H1 2022
H1 2022 (%)
H1 2023
H1 2023 (%)
Aerospace
3,492
77%
4,515
64%
Medical
1,011
22%
1,709
24%
Optical communications
--
--
798
11%
Others (Royalties from licensed
trademarks)
52
1%
67
1%
Total revenue from continuing
operations
4,555
100%
7,089
100%
(Any apparent discrepancies in totals are due to rounding.)
Consolidated revenue from continuing operations in the first
half of 2023 increased by 55.6% compared to the first half of
2022.
The aerospace segment, the Group's largest market, posted
revenue of EUR 4,515 thousand for the first half of 2023, an
increase of 29.3% compared to the first half of 2022. This segment
represented 64% of consolidated revenue for the first half of
2023.
Sales in the medical segment also demonstrated strong dynamism,
reaching EUR 1,709 thousand for the first half of 2023, thus an
increase of a 69.0% compared to the first half of 2022. This
segment represented 24% of consolidated revenue for the first half
of 2023.
The optical communications business, including design and sales
of variable optical attenuators (VOA) according to a fabless
organization, achieved a revenue of EUR 798 thousand for the first
half of 2023, i.e. 11% of consolidated revenue.
Royalties from licensed trademarks amounted to EUR 67 thousand
for the first half of 2023, similar to the first half of 2022.
Analysis of consolidated income statement
MEMSCAP’s consolidated earnings for the first half of 2023 are
given within the following table:
In thousands of euros
H1 2022
H1 2023
Revenue from continuing
operations
4,555
7,089
Cost of revenue
(2,841)
(4,030)
Gross margin
1,714
3,059
% of revenue
37.6%
43.2%
Operating expenses*
(1,685)
(1,901)
Operating profit /
(loss)
29
1,158
Financial profit / (loss)
95
23
Income tax expense
(38)
(47)
Net profit / (loss) from
continuing operations
86
1,134
Profit / (loss) after tax from
discontinued operations
(657)
--
Net profit / (loss)
(571)
1,134
(Financial data were subject to a limited review by the Group’s
statutory auditors. On August 31, 2023, MEMSCAP’s board of
directors authorized the release of the interim condensed
consolidated financial statements on June 30, 2023. Any apparent
discrepancies in totals are due to rounding.) * Net of research
& development grants.
The strong growth in business volumes and the evolution of sales
mix resulted in a consolidated gross margin of EUR 3,059 thousand
for the first half of 2023, representing 43.2% of consolidated
revenue, compared to EUR 1,714 thousand for the first half of 2022,
representing 37.6% of consolidated revenue. This represented an
increase of 5.6 percentage points in margin.
Operating expenses, net of research and development grants,
amounted to EUR 1,901 thousand for the first half of 2023, compared
to EUR 1,685 thousand for the first half of 2022. This increase was
mainly driven by significant developments in commercial operations
and by the impact of the growth in business volumes on the Group's
structure.
The average equivalent full-time workforce related to continuing
operations increased from 41.3 people in the first half of 2022 to
51.7 people in the first half of 2023.
For the first half of 2023, the Group posted an operating profit
from continuing operations of EUR 1,158 thousand (16.3% of
consolidated revenue), compared to breakeven operating earnings for
the first half of 2022.
The financial result was at breakeven for the first half of
2023, compared to a net gain of EUR 95 thousand for the first half
of 2022, resulting from the exchange rate fluctuations of the US
dollar and the Norwegian krone.
The tax expense recorded for the first half of 2023 and 2022
corresponded to the variation in deferred tax assets. This charge
has no impact on the Group's cash flow.
The Group reported a net profit after tax from continuing
operations of EUR 1,134 thousand for the first half of 2023
compared to a net profit of EUR 86 thousand for the first half of
2022.
The Group therefore posted a consolidated net profit of EUR
1,134 thousand for the first half of 2023 (16.0% of consolidated
revenue) compared to a net loss of EUR 571 thousand for the first
half of 2022 including discontinued operations*.
*As part of the FABLITE program, the US Custom products
division, including the design and manufacturing of MEMS components
for third parties and the related foundry services, was sold in
December 2022. In accordance with IFRS 5, the net loss relating to
this business, i.e. EUR 657 thousand for the first half of 2022,
was recognized in loss after tax from discontinued operations.
Evolution of the Group’s cash / Consolidated shareholders’
equity
Adjusted EBITDA1 from continuing operations for the first half
of 2023 amounted to EUR 1,677 thousand compared to EUR 711 thousand
for the first half of 2022.
In line with the increase in business volumes, the Group's
working capital requirement increased by EUR 1,779 thousand for the
first half of 2023, compared to an increase of EUR 127 thousand for
the first half of 2022. This significant increase in the working
capital requirement was due to the rise in accounts receivable and
inventory levels.
As of June 30, 2023, the Group posted available cash of EUR
4,832 thousand (December 31, 2022: EUR 5,456 thousand) including
cash investments (Corporate bonds / investment securities) recorded
under non-current financial assets.
As of June 30, 2023, MEMSCAP shareholders’ equity totalled EUR
16,079 thousand (December 31, 2022: EUR 15,587 thousand).
1 Adjusted EBITDA means operating profit before depreciation,
amortisation, share-based payment charge (IFRS 2) and including
foreign exchange gains/losses related to ordinary activities.
Perspectives
The 2022 financial year was marked by the completion of the
FABLITE program, which ended with the sale of the Group's Custom
Products business and its US-based factory. This sale operation was
accompanied by the establishment of a fabless organization,
enabling the Group to address the variable optical attenuators
(VOA) market with the creation of the optical communications
business unit, whose commercial activities were effective in
January 2023.
Following the successful completion of the FABLITE program
within the initially planned timeframe, the Group launched the 4G
development plan from the first quarter of 2023. This 4G plan aims
for consecutive, competitive, profitable, and responsible growth of
the Group's activities, with an average annual consolidated revenue
growth rate of 20% over the period from 2022 to 2026. The plan
highlights strong development prospects for the aerospace and
medical activities in growing structural markets as well as new
opportunities.
With an adjusted EBITDA1 of EUR 1,677 thousand for the first
half of 2023, representing 23.7% of consolidated revenue (compared
to EUR 711 thousand for the first half of 2022), and a net profit
of EUR 1,134 thousand for the same period, MEMSCAP demonstrates the
success of its 4G plan launch.
To ensure the growth of its aerospace activities over the next 3
years, the Group first intends to leverage its reputation in its
current markets (air data computer, cabin pressure control systems,
ground-based aerial tests, etc.) to increase business volumes with
existing customers and expand its market share with new clients.
The Group also aims to continue meeting the growing market demand
for UAV (Unmanned Aerial Vehicle) and address the market for
electric Vertical Take-Off and Landing Vehicles (eVTOL).
Additionally, MEMSCAP plans to strengthen its growth by penetrating
the engine control market, both in Engine Monitoring Units (EMU)
and Full Authority Digital Engine Control (FADEC). This will
require the qualification of the new SP85 sensor family developed
as part of the Sensor Technology for Green and Safe Jet Engines
(STEGS) program which aims at developing safer and more
environmentally friendly engines and was funded in previous years
by the Norwegian government.
In this context, the Group announced in May 2023 the signing of
a multi-year development and supply contract for pressure modules
for Engine Monitoring Units (EMU) with Meggitt PLC. Under this
contract, MEMSCAP will provide Meggitt with various configurations
of pressure modules, incorporating a customized and ruggedized
version of the new generation of its SP85 pressure sensor.
The growth drivers in the MEMSCAP’s medical business primarily
rely on the development of the Group’s current markets, especially
those that have been established in recent years. These markets
include pressure measurement solutions used as medical accessories
for patient monitoring in intensive care units, sensors integrated
into blood filtration equipment, and solutions implanted in the
human body. Additionally, MEMSCAP continues to expand its solutions
for the urology market (already representing 10.8% of its half-year
medical revenue) and is initiating commercial efforts in the fields
of lung/heart devices and angiography.
Furthermore, the Group leverages its intellectual property to
serve its niche market of variable optical attenuators (VOA) for
fiber optic systems, thanks to its new fabless organization as
previously mentioned.
All these actions are intended to maintain the positive trend
initiated in the first half of 2023.
"After the success of the FABLITE program, MEMSCAP’s teams
demonstrate once again their execution capabilities by rapidly
turning the ambitious 4G program objectives into reality." says
Jean Michel Karam, CEO of MEMSCAP. "With a solid balance sheet, the
Group is intensifying its efforts to confirm every quarter its
profile of profitable and responsible hyper-growth."
Q3 2023 earnings: October 25, 2023
About MEMSCAP
MEMSCAP is a leading provider MEMS based pressure sensors,
best-in-class in term of precision and stability (very low drift)
for two market segments: aerospace and medical. MEMSCAP also
provides variable optical attenuators (VOA) for the optical
communications market.
For more information, visit our website at: www.memscap.com
MEMSCAP is listed on Euronext Paris (Euronext Paris - Memscap -
ISIN code: FR0010298620 - Ticker symbol: MEMS)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Interim condensed consolidated financial statements at 30
June 2023
30 June 2023
31 December 2022
€000
€000
Assets
Non-current assets
Property, plant and
equipment.................................................................
886
901
Goodwill and intangible
assets..................................................................
6 559
6 888
Right-of-use
assets....................................................................................
4 354
4 764
Other non-current financial
assets............................................................
1 239
1 276
Employee benefit net
asset.......................................................................
5
6
Deferred tax
asset....................................................................................
89
137
13 132
13 972
Current assets
Inventories...............................................................................................
2 894
2 578
Trade and other
receivables......................................................................
3 667
2 494
Prepayments............................................................................................
248
222
Cash and short-term
deposits...................................................................
3 593
4 180
10 402
9 474
Total assets
23 534
23 446
Equity and liabilities
Equity
Issued
capital............................................................................................
1 869
1 869
Share
premium.........................................................................................
17 972
17 972
Treasury
shares........................................................................................
(118)
(144)
Retained
earnings.....................................................................................
1 002
(242)
Foreign currency
translation.....................................................................
(4 646)
(3 868)
16 079
15 587
Non-current liabilities
Lease
liabilities.........................................................................................
4 114
4 479
Interest-bearing loans and
borrowings......................................................
77
128
Employee benefit
liability..........................................................................
72
69
4 263
4 676
Current liabilities
Trade and other
payables.........................................................................
2 571
2 487
Lease
liabilities.........................................................................................
487
576
Interest-bearing loans and
borrowings......................................................
101
101
Provisions.................................................................................................
33
19
3 192
3 183
Total liabilities
7 455
7 859
Total equity and liabilities
23 534
23 446
CONSOLIDATED STATEMENT OF INCOME
Interim condensed consolidated financial statements at 30
June 2023
For the six months ended 30
June
2023
2022
Continuing operations
€000
€000
Sales of goods and
services.................................................................................
7 089
4 555
Revenue............................................................................................................
7 089
4 555
Cost of
sales.......................................................................................................
(4 030)
(2 841)
Gross
profit.......................................................................................................
3 059
1 714
Other
income.....................................................................................................
157
204
Research and development
expenses.................................................................
(938)
(945)
Selling and distribution
costs..............................................................................
(415)
(306)
Administrative
expenses.....................................................................................
(705)
(638)
Operating profit /
(loss).....................................................................................
1 158
29
Finance
costs.....................................................................................................
(97)
(87)
Finance
income..................................................................................................
120
182
Profit / (loss) for the period from
continuing operations before tax..................
1 181
124
Income tax
expense...........................................................................................
(47)
(38)
Profit / (loss) for the period from
continuing operations...................................
1 134
86
Discontinued operations
Profit/(loss) after tax for the period
from discontinued operations......................
--
(657)
Profit / (loss) for the
period...............................................................................
1 134
(571)
Earnings per share:
- Basic, for profit / (loss) for the
period attributable to ordinary equity holders of the parent (in
euros)................................................................................
€ 0.152
€ (0.077)
- Diluted, for profit / (loss) for the
period attributable to ordinary equity holders of the parent (in
euros)....................................................................
€ 0.147
€ (0.077)
- Basic, profit / (loss) for the period
from continuing operations attributable to ordinary equity holders
of the parent (in euros)....................................
€ 0.152
€ 0.012
- Diluted, profit / (loss) for the period
from continuing operations attributable to ordinary equity holders
of the parent (in euros)................................
€ 0.147
€ 0.012
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Interim condensed consolidated financial statements at 30
June 2023
For the six months ended 30
June
2023
2022
€000
€000
Profit / (loss) for the
period........................................................................
1 134
(571)
Items that will not be reclassified
subsequently to profit or loss
Actuarial gains /
(losses)..............................................................................
--
--
Income tax on items that will not be
reclassified to profit or loss..................
--
--
Total items that will not be
reclassified to profit or loss.............................
--
--
Items that may be reclassified
subsequently to profit or loss
Net gain / (loss) on available-for-sale
financial assets...................................
(34)
(141)
Exchange differences on translation of
foreign operations...........................
(778)
(273)
Income tax on items that may be
reclassified to profit or loss......................
--
--
Total items that may be reclassified to
profit or loss..................................
(812)
(414)
Other comprehensive income for the
period, net of tax.............................
(812)
(414)
Total comprehensive income for the
period, net of tax..............................
322
(985)
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Interim condensed consolidated financial statements at 30
June 2023
(In thousands of euros, except for
number of shares)
Number
Issued
Share
Treasury
Retained
Foreign
Total
of shares
capital
premium
shares
earnings
currency translation
shareholders’ equity
€000
€000
€000
€000
€000
€000
At 1 January
2022............................................................................
7 476 902
1 869
17 972
(144)
(1 130)
(2 779)
15 788
Loss for the
period............................................................................
--
--
--
--
(571)
--
(571)
Other comprehensive income for the period,
net of tax....................
--
--
--
--
(141)
(273)
(414)
Total comprehensive
income............................................................
--
--
--
--
(712)
(273)
(985)
Treasury
shares................................................................................
--
--
--
(6)
--
--
(6)
At 30 June
2022...............................................................................
7 476 902
1 869
17 972
(150)
(1 842)
(3 052)
14 797
At 1 January
2023............................................................................
7 476 902
1 869
17 972
(144)
(242)
(3 868)
15 587
Profit for the
period..........................................................................
--
--
--
--
1 134
--
1 134
Other comprehensive income for the period,
net of tax....................
--
--
--
--
(34)
(778)
(812)
Total comprehensive
income............................................................
--
--
--
--
1 100
(778)
322
Treasury
shares................................................................................
--
--
--
26
--
--
26
Share-based
payment.......................................................................
--
--
--
--
144
--
144
At 30 June
2023...............................................................................
7 476 902
1 869
17 972
(118)
1 002
(4 646)
16 079
CONSOLIDATED CASH FLOW STATEMENT
Interim condensed consolidated financial statements at 30
June 2023
For the six months ended 30
June
2023
2022
€000
€000
Operating activities:
Net profit / (loss) for the
period..............................................................................
1 134
(571)
Profit/(loss) after tax for the period
from discontinued operations..........................
--
(657)
Profit / (loss) for the period from
continuing operations..........................................
1 134
86
Non-cash items written back:
Amortization and
depreciation..........................................................................
356
499
Loss / (capital gain) on disposal of fixed
assets...................................................
(3)
35
Other non-financial
activities............................................................................
182
52
Accounts
receivable................................................................................................
(1 367)
212
Inventories.............................................................................................................
(597)
(202)
Other
debtors.........................................................................................................
(44)
(52)
Accounts
payable....................................................................................................
(67)
149
Other
liabilities.......................................................................................................
296
20
Net cash flows from / (used in)
operating activities - continuing operations..........
(110)
799
Net cash flows used in operating
activities - discontinued operations......................
--
(614)
Total net cash flows from / (used in)
operating activities.......................................
(110)
185
Investing activities:
Purchase of fixed
assets..........................................................................................
(190)
(223)
Proceeds from sale / (purchase) of other
non-current financial assets......................
19
155
Net cash flows used in investing
activities - continuing operations.........................
(171)
(68)
Net cash flows used in investing
activities - discontinued operations........................
--
(7)
Total net cash flows used in investing
activities.....................................................
(171)
(75)
Financing activities:
Repayment of
borrowings.......................................................................................
(50)
(70)
Payment of principal portion of lease
liabilities........................................................
(242)
(298)
Sale / (purchase) of treasury
shares........................................................................
26
(6)
Net cash flows used in financing
activities - continuing operations.........................
(266)
(374)
Net cash flows used in financing
activities - discontinued operations.......................
--
--
Total net cash flows used in financing
activities.....................................................
(266)
(374)
Net foreign exchange
difference.............................................................................
(40)
(41)
Increase / (decrease) in net cash and
cash equivalents...........................................
(587)
(305)
Opening cash and cash equivalents
balance...........................................................
4 180
3 648
Closing cash and cash equivalents
balance.............................................................
3 593
3 343
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230831570369/en/
Yann Cousinet Chief Financial Officer Ph.: +33 (0) 4 76 92 85 00
yann.cousinet@memscap.com
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