Nanofilm Technologies (MZH) H1 2024 earnings summary

Executive summary

• 1H2024 revenue grew 13% YoY to S$82.6m, led by AMBU and NFBU growth, partly offset by IEBU decline.

• Adjusted EBITDA rose 61.4% to S$16.7m; margin improved to 20.2% from 14.2%.

• Net loss narrowed to S$3.7m from S$7.9m, reflecting improved gross margins and higher adjusted EBITDA.

• Interim dividend of 0.33 Singapore cents per ordinary share declared.

Financial highlights

• Gross profit rose 18.0% to S$27.7m; gross margin increased to 33.5% from 32.0%.

• Administrative expenses fell 3.3% to S$21.2m; staff costs declined S$1.9m, or 5%.

• Selling and distribution costs increased 27.7% to S$4.7m, reflecting investment in sales capabilities.

• R&D and engineering expenses remained stable, with higher capitalisation as more projects progressed toward commercialisation.

Outlook and guidance

• FY2024 revenue and profits expected to exceed FY2023, barring unforeseen circumstances.

• 2H2024 growth expected from 3C seasonality, delayed project ramps, new customer contributions and improved margins.

• Cost optimisation, process streamlining, automation and strategic procurement to continue; full-year capex expected to be lower.

• Continued investment in Vietnam and Europe to support China+1 strategy and long-term growth.