HELSINKI – Scanfil reported fourth quarter revenue of €191.7 million (US$213.6 million), an increase of 24.5% year-over-year.

Net profit was €8.4 million, up 171% compared to the fourth quarter of 2020.

Operating profit was €9.5 million, growth of 120.9%, representing 5% of revenue.

For full-year 2022, the electronics manufacturer posted revenue of €695.7 million, an increase of 16.9% compared to 2020.

Net profit for the year was €29.8 million, down 19.2% year-over-year.

Operating profit was €39.6 million, a decrease of 10.8%, accounting for 5.7% of revenue. The comparison includes a capital gain of €11.4 million from the sale of the Hangzhou factory.

Scanfil estimates 2022 revenue between €710 million and €760 million and adjusted operating profit between €43 million and €48 million.

The guidance involves uncertainty especially arising from the availability and price level of semiconductors and the delivery capability of the supply chain. In addition, the Covid-19 pandemic and risks related to it create uncertainty.

“Driven by strong customer demand, the year 2021 became a record year of growth and turnover,” said CEO Petteri Jokitalo. “This all despite the pandemic and the challenges of material availability. Turnover increased 16.9% to €696 million, nearly reaching the target of €700 million set for 2023.

“The turnover for the last quarter of the year was a record high €191.7 million, which increased 24.5% compared to the last year. Growth was propelled by strong customer demand, in addition to increases in material costs.

“Adjusted operating profit in 2021 was €40.3 million, 5.8% of turnover, and the fourth quarter was at €10.2 million, 5.3% of turnover, falling short of the long-term target level of 7%.

“The biggest negative effects on operating profit for the period were caused by material availability challenges, abnormal high prices paid for spot market purchases, and the relocation of production of the Hamburg factory. The challenging material situation hampered us, especially in the second half of the year. The product transfer from Hamburg was completed by the end of the third quarter, and operations at the Hamburg factory ended during the fourth quarter.

“Net cash flow from operating activities in 2021 was negative €12.5 million, mainly due to a strong increase in inventories. The increase in inventories was affected by rising customer demand, as well as a slowdown in inventory turnover caused by a challenging material availability situation and higher material costs. Inventory management will continue to be the focus area in 2022.

“Scanfil's balance sheet is still strong, with an equity ratio of 45.3% and a gearing of 28.9%, enabling the necessary investments and the implementation of a dividend policy. The board of directors proposes a dividend of €0.19 per share for 2021, an increase of 11.8% compared to a year ago. If implemented, Scanfil's dividend will increase for the ninth year in a row.

“The demand outlook for Scanfil's customers is strong for 2022, and our focus is very clear. We continue to respond to our customer demand, organic growth and turning our profitability to the target we have set. The short-term challenges and risks are mainly related to the availability of materials, especially semiconductors, which we believe will continue to be challenging, at least in the first half of the year.

“We expect our turnover will continue to grow, being €710–760 million this year, and operating profit will increase to €43–48 million.

“We aim for organic annual growth of 5-7% and an operating profit level of 7% in the longer term. To reach our growth target, we have acquired more production space at our Atlanta and Wutha factories, and started planning expansion options at our Suzhou factory. In the long run, we see North America and Asian markets as interesting expansion areas.

“The year 2021 was strongly two-folded: Strong customer demand combined with material availability challenges, the pandemic, and the relocation of production of Hamburg was very demanding on our personnel. I want to thank our dedicated employees for their perseverance and good work, as well as the support and trust of our customers.”

Ed.: €1 = US$1.11