ADVA Optical Networking SE: ADVA posts quarterly revenues of EUR 146.7 million for Q3 2020
DGAP-News: ADVA Optical Networking SE
/ Key word(s): Quarter Results/Forecast
ADVA posts quarterly revenues of EUR 146.7 million for Q3 2020 Munich, Germany. October 21, 2020. ADVA (ISIN: DE0005103006), a leading provider of open networking solutions for the delivery of cloud and mobile services, reported final financial results for Q3 2020 ended on September 30, 2020. The results have been prepared in accordance with International Financial Reporting Standards (IFRS). Q3 2020 financial summary1
1 Potential difference due to rounding
Pro forma gross profit in Q3 2020 increased by 3.4% reaching EUR 51.9 million (35.4% of revenues) compared to EUR 50.2 million (34.6% of revenues) in Q2 2020 and by 5.8% compared to EUR 49.1 million (34.0% of revenues) in the year-ago quarter. The increase was mainly due to the stronger euro compared to the US dollar. Furthermore, the relocation of production facilities out of China resulted in lower US tariffs compared to the year-ago quarter. Pro forma operating income for Q3 2020 was EUR 11.1 million (7.5% of revenues) and increased by 9.4% compared to EUR 10.1 million (7.0% of revenues) in Q2 2020. Compared to the year-ago quarter, pro forma operating income improved substantially by 49.5% from EUR 7.4 million (5.1% of revenues). In addition to the effects on gross profit, this substantial margin improvement is mainly due to the cost improvement measures introduced in 2019 and reduced discretionary spending. Consequently, operating income for Q3 2020 of EUR 9.8 million increased by 12.8% from EUR 8.7 million reported for Q2 2020 and significantly increased by 205.3% from EUR 3.2 million income in the same year-ago quarter. While Q3 2019 was negatively impacted by one-off expenses of EUR 2.5 million resulting from the introduced cost improvement measures, Q3 2020 was positively impacted by the renewed cost basis. Net income was EUR 6.7 million in Q3 2020, 12.6% down from EUR 7.6 million in Q2 2020 but grew significantly by 204.6% from a net income of EUR 2.2 million in Q3 2019. The decrease compared to Q2 2020 is mainly due to the negative effects from currency translation. Despite a voluntary partial repayment of EUR 5.0 million of the revolving credit facility, the company's cash and cash equivalents totaled at EUR 68.3 million, representing a slight increase of EUR 0.7 million compared to EUR 67.6 million at the end of Q2 2020. Year-over-year cash and cash equivalents significantly increased by EUR 29.9 million from EUR 38.4 million. While Q3 2019 was impacted by the before mentioned one-off expenses and the inventory build-up due to the US trade tariffs, Q3 2020 benefited from higher profitability and further working capital improvements. Consequently, net debt in Q3 2020 decreased by EUR 9.9 million to EUR 35.0 million from EUR 44.9 million at the end of Q2 2020 and improved by EUR 39.9 million compared to Q3 2019. Net working capital at quarter-end was EUR 124.0 million and improved by EUR 3.9 million compared to EUR 127.9 million at the end of Q2 2020. Management commentary "Despite the current challenges, we were again able to achieve solid financial results and further strengthen our balance sheet. We improved our cash position by EUR 30 million year-over-year. This is an extremely important financial outcome and shows that our team can achieve something excellent even in difficult times," commented Uli Dopfer, CFO, ADVA. "However, due to the rising infection rates in many parts of the world, the risk of new restrictions or even lockdown scenarios is increasing and we must continue to devote a lot of attention to mitigating these changing circumstances. Our focus is on maintaining our procurement and supply chains, strict cost control, but above all, ensuring the safety and health of our employees." The latest news of a second wave with infection rates again increasing in many countries is worrying. The further course of our business for the full year 2020 heavily depends on how the currently increasing number of infections develop and whether this creates further regional lockdown scenarios. Against the background of the outlined influencing factors for the further course of the 2020 financial year, the management board now expects revenues between EUR 565 million and EUR 580 million and a pro forma operating income of between 5% and 6% in relation to revenues for the full year 2020. The revised guidance assumes that the impact of the pandemic on the company's business will not significantly worsen beyond the levels we have already experienced and that no material supply bottlenecks will arise due to new lockdowns. The company will publish its 9M quarterly statement on October 22, 2020 as planned. The financial results for Q4 and the full fiscal year 2020 will be published on February 25, 2021. Conference call details To participate, please register here: A corresponding presentation is available on ADVA's website: The complete quarterly statement 9M 2020 (January - September) is available as a PDF here: https://www.adva.com/en/about-us/investors/financial-results/financial-statements A replay of the call will be available here: Forward-looking statements Use of pro forma financial information
About ADVA Published by: For press:
21.10.2020 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG. |
Language: | English |
Company: | ADVA Optical Networking SE |
Märzenquelle 1-3 | |
98617 Meiningen-Dreissigacker | |
Germany | |
Phone: | +49 89 890 665 0 |
Fax: | +49 89 890 665 199 |
E-mail: | IRelation@advaoptical.com |
Internet: | www.advaoptical.com |
ISIN: | DE0005103006 |
WKN: | 510300 |
Indices: | SDAX |
Listed: | Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover, Munich, Stuttgart, Tradegate Exchange |
EQS News ID: | 1142345 |
End of News | DGAP News Service |
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1142345 21.10.2020