DGAP-News: technotrans SE: technotrans systematically maintains growth strategy

2018 financial year

- Growing dynamism in electric mobility

- Board of Management proposes dividend of EUR 0.88

- Further growth planned for 2019

Sassenberg, March 12, 2019 - technotrans SE successfully completed the past financial year by increasing its diversification and focusing systematically on growth markets. The company grew revenue by 5.5 percent to EUR 216.3 million in the period under review, while operating profit (EBIT) of EUR 17.4 million remained unchanged from the previous year. For 2019, the Board of Management expects the growth trajectory to continue and proposes a dividend of EUR 0.88 per share for the past financial year.

"We mastered the challenges of the past financial year outstandingly and at the same time paved the way for further growth," commented Dirk Engel, Chief Executive Officer of technotrans SE, upon the presentation of the audited figures for 2018. Including the two acquisitions completed in the period under review, revenue rose 5.5 percent to EUR 216.3 million.

With regard to operating profit at EBIT level, technotrans matched the previous year's level at EUR 17.4 million. This development is attributable partly to the weakening of the economic environment over the year and partly to investment for business expansion, as well as to the growth-related buildup in capacity. Net income rose by 1.6 percent to EUR 12.4 million in the 2018 financial year. "We have shown how addressing diversified markets, with a focus on growth markets, can also compensate for variations in economic conditions," stressed Engel.

In the period under review, the Technology segment brought in 72 percent of revenue. technotrans generated growth of 6.0 percent to EUR 156.5 million in this segment. The result for the segment was EUR 8.1 million, as in the previous year. The Services segment grew by 4.0 percent and generated revenue of 59.8 million in 2018. In this case the increase was driven predominantly by follow-on business in the technology markets outside the printing industry and by an improved business in the Technical Documentation area. The segment brought in an operating result (EBIT) of EUR 9.3 million.

Growing dynamism in electric mobility

The growth markets again merit particular mention. The activities in the areas of electric mobility, semiconductors as well as medical and scanner technology remained successfully on track in the past financial year with high double-digit revenue growth. The area with the most momentum was electric mobility, where technotrans strengthened its position as a specialist for mobile and stationary battery cooling systems. The installed base of technotrans cooling systems is growing thanks to further pioneering application projects associated with wide-ranging mobility activities.

In the past year technotrans further increased its market penetration in the plastics processing industry by taking over Reisner Cooling GmbH (Holzwickede) and the business operations of Hahn Enersave GmbH (Wiehl). These ventures are already expected to make a positive contribution to revenue and profit in the current financial year.

The business areas of laser equipment and machine tools as well as stamping and forming technology likewise played a part in our positive business performance in 2018.

The print area remains a significant core business area of the Group of companies, whose wide range of products span offset, digital and flexographic printing. However technotrans was not immune to ongoing consolidation in the printing industry's end user markets, and the company consequently suffered a slight drop in revenue for that area. Nevertheless, growth in the other markets as previously mentioned comfortably compensated for this effect.

Orderly financial position

technotrans is again able to present a solid balance sheet. As a result of the growth investments made in the past financial year, the balance sheet total grew by a further 8.6 percent. Equity rose to EUR 75.2 million and the equity ratio reached 55.3 percent. Net debt increased particularly in connection with the raising of fresh financing for the construction of the new production plant of Termotek GmbH, reaching EUR 19.4 million at the balance sheet date.

With net income of EUR 12.4 million, operating cash flow came to 22.5 million in the period under review. The changes in working capital of EUR 16.2 million as well as higher cash outflows for tax payments for the years 2017 and 2018 had a negative cash flow effect. Net cash from operating activities thus came to EUR 6.3 million. After deduction of the cash outflows necessitated by investing activities, free cash flow consequently remained slightly negative at EUR -3.8 million. Financing activities produced a positive cash contribution in the amount of EUR 4.5 million in the past financial year. The fact that the overall financial position remains orderly is reflected in a very comfortable gearing ratio of 0.9x (net debt/EBITDA).

Outlook

The further business development of the technotrans Group in 2019, too, will depend to a large degree on the world economy and on various project launches. Based on the economic environment and despite continuing political uncertainties, technotrans expects to see growth in the financial year in progress. Against this backdrop, the Board of Management anticipates revenue in the range of EUR 224 to 232 million and an operating result (EBIT) of between EUR 17.5 and 19.0 million for the Group.

The Board of Management expects this to be based on a steady business performance in the printing industry, plus moderate growth in the markets of the laser and machine tool industry as well as for stamping and forming technology. In the plastics processing industry, technotrans believes it will increase its market shares despite the market's sideways movement.

"What is more, in close cooperation with a large number of existing and new customers we are developing new customer-specific solutions for the dynamically growing markets in the spheres of electric mobility and medical technology," summarised Engel.

technotrans continues to probe the market for potential acquisition targets, while in parallel taking measures to increase productivity. In the medium term, consolidated revenue of EUR 300 million is the target.

With the construction of the new production building in Baden-Baden, which reflects the latest findings in energy efficiency and process organisation, technotrans is performing the groundwork for sustained future growth. The production start is scheduled for August 2019.

The Board of Management and Supervisory Board will again propose to the Annual General Meeting on May 10, 2019 that half of the consolidated net profit be distributed; this represents a dividend of EUR 0.88 per share.

For further information, visit: http://www.technotrans.de

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Note

This communication contains statements on the future development of the technotrans Group. These reflect the present views of the management of technotrans SE and are based on the corresponding plans, estimates and expectations. We point out that the statements are subject to certain risks and uncertainties which could mean that the actual results differ considerably from those expected.