Nanofilm Technologies (MZH) H2 2022 earnings summary

Executive summary

• FY2022 revenue declined 3.8% YoY to S$237.4m; adjusted EBITDA fell 15.9% to S$80.5m and PATMI fell 29.6% to S$43.8m amid macro and operating headwinds.

• Expansion, product development and geographic diversification continued; growth toward the 2025 targets is expected to be non-linear.

Financial highlights

• Revenue was S$237.4m versus S$246.7m in FY2021, down 3.8%.

• Adjusted EBITDA was S$80.5m versus S$95.7m, down 15.9%; it excludes specified non-recurring costs and gains, including PPE items, professional fees, share-plan and COVID-19 expenses.

• PAT was S$43.3m versus S$62.5m, down 30.8%; PATMI was S$43.8m versus S$62.2m, down 29.6%.

• Cash and liquid assets totaled S$157m at 31 Dec 2022.

Outlook and guidance

• 2023 outlook remains challenging; China was soft in Q1 FY2023, with gradual recovery expected in H2 FY2023.

• Revenue and PATMI targets remain S$500m and S$100m, respectively, by 2025; the path is expected to be non-linear.

• Meaningful contributions from longer-term market opportunities are expected from 2024 onward; some opportunities are nearing production stages.