Siltronic (WAF) Q2 2024 earnings summary

Executive summary

• Q2 2024 results aligned with expectations amid ongoing weak wafer demand, with productivity and efficiency prioritized and sales and profitability remaining resilient.

• AI-driven growth anticipated to boost wafer demand in the future, though current end-market growth is offset by excess inventory.

• Measures to manage costs and liquidity included labor adjustments, hiring freeze, and strict working capital management.

• The new 300mm fab in Singapore officially opened in June 2024, marking a significant milestone, with ramp-up and customer qualifications ongoing.

• Medium-term outlook remains positive, with growth expected from AI, digitalization, and electromobility trends.

Financial highlights

• Q2 2024 sales reached EUR 351.3 million, up 2.3% quarter-on-quarter but down 13% year-over-year, driven by higher wafer area sold.

• EBITDA was EUR 90.6 million (25.8% margin), nearly flat sequentially and slightly down due to negative FX effects.

• EBIT stood at EUR 33 million, impacted by increased plant depreciation.

• Net income for Q2 was EUR 22.4 million, with EPS at EUR 0.73.

• CapEx for H1 2024 was EUR 313.6 million, mainly for the Singapore fab; full-year guidance revised down to EUR 500–530 million.

Outlook and guidance

• Full-year 2024 sales now expected to be in the high single-digit percentage range below 2023, mainly due to lower volumes and slightly negative FX, product mix, and price effects.

• EBITDA margin guidance raised to 23–25%, with H2 margin expected to be lower than H1 due to price, mix, FX, and new fab costs.

• CapEx guidance further reduced to EUR 500–530 million, anticipating improved but still negative net cash flow.

• Depreciation and amortization for 2024 expected below EUR 300 million.

• Mid-term ambition for 2028: sales above EUR 2.2 billion and EBITDA margin in the high 30s.