"We have shown that even at a lower revenue level, LPKF not only generates profit but also shareholder value for our investors," says Goetz M. Bendele, CEO of LPKF. The high profitability relative to revenue is due to the fact that the company is able to generate good gross margin levels with its solutions and services, and at the same time systematically reduce the company's (fixed) cost base further. "Regardless of any near-term economic developments, we will maintain our focus on cost and performance improvements, along with targeted investments in technologies and applications,” adds Bendele.
LPKF continues to be net debt free, with total cash on hand of EUR 13.3 million. At EUR 25.7 million, incoming orders in the third quarter were slightly above revenue. Order backlog at the end of September was EUR 22.4 million, slightly above the mid-year figure. Both incoming orders for the first nine months and orders on hand at the end of September are slightly higher this year than in 2019 if large orders from a customer in the Solar segment are excluded from the comparison.
CFO Christian Witt believes that LPKF is well positioned and financially stable: "By cutting costs quickly and flexibly, we can maintain an appropriate profitability even when operating at a lower revenue level – and at the same time, we invest in new technologies and applications, and can quickly ramp up our capacities when demand increases. We are confident that LPKF will successfully overcome the challenges posed by the current crisis, and that we will ultimately emerge stronger from this crisis," says Witt.
The COVID 19 pandemic has triggered a severe recession in most economies and is currently once again gaining strength in most of the company's markets. An end to the pandemic is not yet in sight. Against this backdrop, the Management Board’s ability to forecast remains limited.
For 2020, the company expects to generate revenue between EUR 96 and 102 million and an EBIT margin of 8 to 12 %. For 2021 and the following years, the Management Board continues to expect sustainable, profitable growth in all segments and confirms the medium-term forecast given in February.
The complete 9-month financial report can be downloaded here.