Based on preliminary figures, VAT’s second-quarter and half-year 2023 results are substantially below the previous year’s periods, confirming the negative market outlook given earlier in the year. The lower volumes are the result of a sharp decrease of investment activities especially in the semiconductor industry. This lower activity was driven by weaker demand, especially in consumer-exposed areas, such as memory chips used in smartphones, tablets or PCs, reflecting macroeconomic uncertainties related to interest rates, inflation and GDP growth. In addition, global demand was further dampened by the persisting trade restrictions by the US and other administrations on integrated circuits and related manufacturing equipment for China. VAT is addressing these market developments with a variety of operative measures and with the objective of retaining flexibility to respond quickly to an improvement. In June, VAT introduced short time work at its production site in Switzerland as a proven operative measure. VAT’s strategic growth initiatives are not affected by these measures.

Q2 2023 results

VAT achieved preliminary Q2 orders of around CHF 155 million, down 56% compared with the same period a year earlier. Compared to Q1 2023, order intake has started to recover and was 14% higher sequentially due to a combination of lower cancellations and slightly increased new order activity. Sales amounted to approximately CHF 221 million, a decrease of around 23% year-on-year and 5% quarter-on-quarter. FX movements, especially USD against CHF, had a substantial negative impact on Q2 2023 sales growth of about -8 percentage points. The preliminary second quarter book-to-bill ratio of 0.7 recovered from the very low level recorded in the first quarter. At the end of June, the order book amounted to approximately CHF 340 million, some 18% lower than at the end of the first quarter of 2023.

Half-year 2023 results

For the first half-year 2023, preliminary orders amounted to approximately CHF 292 million, down 55% compared to a year earlier. Sales decreased by 17% to CHF 454 million year-on-year. Lower volumes, adverse FX effects and persisting inflationary cost pressure further weighed on VAT’s EBITDA margin. Preliminary figures indicate that VAT achieved a H1 EBITDA margin slightly below 30%, a decrease of about 5 percentage points compared to H1 2022. Preliminary free cash flow reached a first six-month level well below the previous year’s due to lower EBITDA and higher capex but in line with the company’s expectations communicated earlier in 2023.

A more detailed discussion of results and an update on VAT’s expectations for the rest of 2023 will be provided with the release of the detailed second quarter and half-year 2023 results on July 27, 2023.

¹ Quarter-on-Quarter; ²Year-on-Year