Elmos Semiconductor (ELG) Q3 2024 earnings summary

Executive summary

• Q3 2024 sales grew 3.4% year-over-year to €156.6M, with a 10.3% sequential increase, and EBIT margin at 25.5% despite challenging automotive market conditions and customer inventory adjustments.

• Profitable growth continued, supported by strong delivery performance, stable demand for intelligent vehicle electronics, and record design wins in 2024.

• Strategic transformation to a fabless model is progressing, with the wafer fab sale to Littelfuse expected to close in December 2024.

• Confirmed commitment to operational excellence, cash generation, and a positive outlook for the full year, with midterm targets for 2030 set at €1B sales and a 25% EBIT margin.

• ESG initiatives and compliance with new EU disclosure standards are underway.

Financial highlights

• Q3 2024 sales reached €156.6M, gross margin was 47.0%, and EBIT was €39.9M with a 25.5% margin.

• Gross profit rose 5.3% year-over-year to €73.6M; operating income increased 14.9% to €46.2M.

• Net income after non-controlling interests was €25.5M, down 8.7% year-over-year; EPS was €1.49.

• Adjusted free cash flow improved 34.3% to €45.5M, driven by strong operating cash flow and low CAPEX.

• Capital expenditures dropped to €5.9M (3.8% of sales) in Q3 2024.

Outlook and guidance

• Full-year 2024 sales guidance confirmed at the lower end of €605M ± €25M, with small single-digit growth expected.

• Operating EBIT margin forecast at 25% ±2pp for 2024, excluding special effects from the wafer fab sale.

• Capital expenditures for 2024 projected to decrease to around 12% ±2pp of sales.

• Positive adjusted free cash flow anticipated for 2024, including the impact of the wafer fab sale.

• By 2030, targets set for €1B sales, 25% EBIT margin, and CAPEX below 10% of sales.