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21 May 2024
Sales revenues up another 10%, despite what CEO called a challenging market environment.
Optics giant Zeiss has posted half-yearly sales of €5.3 billion, up 10 per cent year-on-year, and indicating that another record-breaking year is on the cards.
Once again, that sales momentum was driven in large part by the Oberkochen, Germany, company’s semiconductor manufacturing technology (SMT) division, where sales in the six months ending March 31 topped €2 billion for the first time.
That amounts to a rise of more than 20 per cent, with the firm’s three other divisions all reporting single-digit increases in sales as challenging macroeconomics affected the business units in different ways.
Zeiss's medical technology and industrial quality and research divisions each accounted for around €1.2 billion in sales, with its consumer division generating revenues of €821 million.
Despite the solid increase in sales, earnings before income and taxes (EBIT) for the accounting period dropped by nearly 20 per cent, to €739 million.
SMT capacity expansion
Of the SMT division’s prospects through September, Zeiss stated: “The market is expected to improve further in the second half of the calendar year. To accommodate the high order intake and customer demand, the segment is driving its capacity expansion and the planned investments for the further development of existing technologies and the introduction of new ones.”
One critical element of that is the introduction of high-numerical aperture (high-NA) reflective optics for key partner ASML’s development of even more advanced extreme ultraviolet (EUV) lithography equipment.
The Zeiss executive team pointed to the uncertain macroeconomic conditions having an impact on order intake, which was slightly below the high level seen in the previous year.
“Large order backlogs compensate for this slowdown,” they added. “Consumer confidence appears to be recovering, indicating stable growth prospects in the medium term.”
As is typical for Zeiss, the company continues to invest very heavily in research and development activity, spending €807 million in the latest period - equivalent to 15 per cent of sales - and recently opened a new innovation hub in Dresden with a focus on life sciences and healthcare applications.
With more than 3000 employees added to the company’s roster over the past 12 months, Zeiss now employs close to 45,000 people - up from 32,000 just prior to the start of the Covid-19 pandemic four years ago.
CEO Karl Lamprecht noted: “Our consistently high expenditure on research and development as well as the investments in the company's transformation and our global infrastructure are central elements of our sustainable growth strategy. They ensure the future viability and positive development of the company.”
Signs of recovery
Looking ahead, Zeiss said that ongoing geopolitical tension and macroeconomic complexities made it difficult to predict how the rest of the financial year will pan out, with the need for resilient and diversified supply chains emphasized.
“Despite a slowdown in order intake dynamics in recent months, we expect that the fiscal year will continue to be positive given the order backlog, which remains high, and the signs of recovery,” said Lamprecht, implying that full-year sales will likely exceed last year’s total of €10.1 billion.
CFO Stefan Müller added: “The half-year figures show that Zeiss is enjoying a stable and financially sound position, even in challenging market conditions. Given our significant investments in digitalization, in transformative initiatives and in the expansion of infrastructure, we can accept temporary fluctuations in the results and will continue to pursue the growth trajectory of the Zeiss Group.”
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