Interim report (Q1 and Q3)
Third Quarter Was Slightly Better Than Last Year, the Initiated Measures to Develop the Company Further Are Progressing
Unless otherwise mentioned, the figures in brackets refer to the corresponding period in the previous year.
Summary July-
- The net sales increased by 0.8 percent year-on-year to
EUR 13.9 million (EUR 13.8 million ). -
The share of product-based net sales was
EUR 7.6 million (EUR 9.3 million ), representing 54.9 percent of the net sales (67.3 percent). The share of Medical Technologies products wasEUR 5.3 million (EUR 6.2 million ) and the share of Defense & Security products wasEUR 2.3 million (EUR 3.1 million ). -
The share of services-based net sales was
EUR 6.3 million (EUR 4.5 million ), representing 45.1 percent of the net sales (32.7 percent). The share of Connectivity Solutions R&D services business wasEUR 3.8 million (EUR 3.0 million ). -
EBITDA was
EUR 0.3 million (EUR 0.2 million ). -
The operating result was
EUR -2.1 million (EUR -2.4 million ). -
Cash flow from operating activities was
EUR 5.2 million (EUR 2.0 million ). -
Net cash flow was
EUR 2.9 million (EUR -0.3 million )
Summary January-
- The net sales declined by 9.7 percent year-on-year to
EUR 49.5 million (EUR 54.8 million ). -
The share of product-based net sales was
EUR 29.0 million (EUR 36.5 million ), representing 58.6 percent of the net sales (66.5 percent). The share of Medical Technologies products wasEUR 16.4 million (EUR 17.4 million ) and the share of Defense & Security products wasEUR 12.6 million (EUR 19.0 million ). -
The share of services-based net sales was
EUR 20.5 million (EUR 18.4 million ), representing 41.4 percent of the net sales (33.5 percent). The share of Connectivity Solutions R&D services business wasEUR 12.7 million (EUR 11.0 million ). -
EBITDA was
EUR 1.9 million (EUR 5.2 million ). -
The operating result was
EUR -5.3 million (EUR -2.6 million ). -
Cash flow from operating activities was
EUR 0.6 million (EUR 8.0 million ). -
Net cash flow was
EUR -9.4 million (EUR -0.3 million ). -
The order backlog was
EUR 25.3 million (EUR 24.8 million ).
Bittium's CEO
The net sales for the third quarter of the year increased slightly from the previous year and was
The product-based net sales decreased in the third quarter of the year by -17.8 percent year-on-year and was
The development in January-September was weak. Turnover decreased by 9.7 percent year-on-year and the operating result was
Despite the negative operating result, the operating cash flow for the third quarter was
However, on a positive note for an otherwise challenging year, it would seem that the impact of the component shortage on our product deliveries is reducing, and in that respect the situation appears to be finally normalizing. However, we will continue to take measures to ensure the availability of components that are important to us in the future as well.
After the summer, we started taking measures to make our operations more efficient and improve our profitability. As part of these measures, we went through change negotiations with the personnel in our Finnish subsidiaries. As a result of the negotiations, we dismissed 61 employees and laid off 8 employees for the time being due to production, financial and operational restructuring reasons.
With the dismissals and layoffs, as well as with other cost-saving measures, we estimate that we will achieve a total of approximately
We have continued the strategy work and seek a clear focus on business operations and sales, as well as review of the processes, operating methods, and cost structure. The change that is currently being implemented in the company's operational model is major and necessary to get the company on the profitable growth path. We are also reorganizing the organization into independent business units, which will bring decisions and operations closer to our customers, serving them even better. The change will also significantly streamline the company at the group-level.
There have also been changes in our group management team as Jari Sankala, the head of the Defense & Security business unit, decided to leave the company.
The interest in Bittium's tactical communication solutions has continued to grow, and new customer pilots have started.
The deployment of Bittium Tough SDR(TM) radios by the Finnish Defense Forces has progressed according to plans, and preparations to promote the larger-scale deployment of the radios have continued well.
Product deliveries of tactical communications continued to our customers in
In the medical technology market, demand for Bittium Faros(TM) ECG measuring devices continued to be good. Product deliveries of Bittium Respiro(TM) home sleep apnea test devices continued in
The demand for R&D services grew, with a particular emphasis on the Industrial IoT market, where the need for wireless connectivity and cloud services are increasing. New customers were won from, for example, the professional tool market and the chemical industry. Shifting the design and manufacturing focus of European companies to
We will tell you more about the updated strategy in conjunction with the Capital Markets Day, which will be held on
Outlook for 2023
Market Outlook 2023
The global disruption in the availability of electronic components has had a slowing effect on the development of the company's business and sales in 2023. However, the markets are recovering, and the company estimates that the component shortage will ease during 2023.
About 70 percent of Bittium's net sales in total are generated from products and related systems, and the uncertainties related to product deliveries have caused significant uncertainty for the accumulation of Bittium's net sales and operating result during the year 2023.
More information about Bittium's market outlook is presented on the company's internet pages at www.bittium.com.
Financial Outlook 2023 (unchanged, updated on
Bittium expects the net sales in 2023 to be at the same level or lower than in the previous year (
Long-term Financial Targets (unchanged)
Bittium aims for an average annual net sales growth of more than 10 percent and an operating profit level of 10 percent and estimates that it will achieve these goals in 2024.
Risks and Uncertainties
Bittium has identified several business, market, and finance-related risk factors and uncertainties that can affect the level of sales and profits.
The global disruption in the availability of electronic components and their price development has caused fast changes in the company's operating environment, however, the situation has improved significantly. The company monitors the development of the situation and actively strives to ensure the availability of components required for product deliveries.
More information about risks and uncertainties can be found on the company's internet pages at www.bittium.com.
GROUP (MEUR) | 7-9/2023 | 7-9/2022 | 1-9/2023 | 1-9/2022 |
3 months | 3 months | 9 months | 9 months | |
13.9 | 13.8 | 49.5 | 54.8 | |
Change of the net sales, % | 0.8 % | -19.4 % | -9.7 % | -3.5 % |
EBITDA | 0.3 | 0.2 | 1.9 | 5.2 |
EBITDA, % of net sales | 2.0 % | 1.2 % | 3.8 % | 9.5 % |
OPERATING PROFIT / LOSS | -2.1 | -2.4 | -5.3 | -2.6 |
Operating profit / loss, % of net sales | -14.9 % | -17.2 % | -10.7 % | -4.8 % |
RESULT OF THE PERIOD FROM CONTINUING OPERATIONS | -2.4 | -2.6 | -6.0 | -3.2 |
EARNINGS PER SHARE (EUR) | -0.066 | -0.073 | -0.168 | -0.091 |
TOTAL R&D INVESTMENTS | 3.9 | 4.9 | 15.1 | 16.1 |
R&D INVESTMENTS, % FROM | 27.9 % | 35.8 % | 30.4 % | 29.3 % |
CAPITALIZED R&D INVESTMENTS | 1.4 | 1.8 | 5.7 | 4.8 |
NET CASH FROM OPERATING ACTIVITIES | 5.2 | 2.0 | 0.6 | 8.0 |
NET CASH FROM INVESTING ACTIVITIES | -1.4 | -2.0 | -6.1 | -5.7 |
NET CASH FROM FINANCING ACTIVITIES | -0.9 | -0.4 | -3.8 | -2.6 |
NET CHANGE IN CASH AND CASH EQUIVALENTS | 2.9 | -0.3 | -9.4 | -0.3 |
CASH AND OTHER LIQUID ASSETS | 9.7 | 21.7 | 9.7 | 21.7 |
12.2 % | 0.5 % | 12.2 % | 0.5 % | |
EQUITY RATIO (%) | 71.0 % | 71.8 % | 71.0 % | 71.8 % |
AVERAGE PERSONNEL DURING THE PERIOD | 609 | 639 | 611 | 645 |
PERSONNEL AT THE END OF THE PERIOD | 604 | 633 | 604 | 633 |
Events after the Review Period
On
With the dismissals and layoffs, and other cost saving measures disclosed on
Oulu,
The Board of Directors
Further Information:
Johan Westermarck
CEO
Tel. +358 40 344 3507
Distribution:
Nasdaq
Major media
About Bittium
Bittium specializes in the development of reliable, secure communications and connectivity solutions leveraging its over 35-year legacy of expertise in advanced radio communication technologies. Bittium provides innovative products and services, customized solutions based on its product platforms and R&D services. Complementing its communications and connectivity solutions, Bittium offers proven information security solutions for mobile devices and portable computers. Bittium also provides healthcare technology products and services for biosignal measuring in the areas of cardiology and neurophysiology. Net sales in 2022 were
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