HELSINKI -- Incap today reported first quarter revenue increased 36.2% year-over-year to EUR 72.7 million ($80.2 million) and net profit rose 27.6% to EUR 8.4 million ($9.27 million).

The contract electronics manufacturer reported adjusted operating profit (EBIT) rose 64.4% to EUR 11.5 million, or 15.8 % of revenue (13.1%). Operating profit increased 67.3% to EUR 11.3 million.

Incap estimates that its revenue and operating profit (EBIT) for 2023 will be lower than in 2022.

In a statement, president and CEO Otto Pukk said, “We started 2023 with a strong quarter both in terms of revenue and profitability. Revenue in the first quarter amounted to EUR 72.7 million, which was 36% more than in the first quarter of 2022. The strong growth was driven by the demand for electronics and supported with earlier investments in additional capacity in our factories. Our profitability remained on a good level due to our efficient and cost-effective operational model, a favorable product mix and solid revenue level."

Construction on Incap's third factory in India is now finished and production ramp has begun. The new factory adds approximately 8,500 sq. meters (91,500 sq. ft.) to the site. The company's Kuressaare, Estonia, factory has a new production line, increasing its overall SMT production capacity by more than 50%. In Slovakia, where our customer volumes have grown and our product portfolio has become wider, we increased the factory’s production area by 1,200 sq. m ((13,000 sq. ft.) by turning a warehouse space in the factory into a production area and building a new warehouse.

As component availability and lead times have improved, Incap said, customers don´t need to place orders as far in advance, as visibility is returning to more normal levels. Also, its largest customer has decided to reduce its inventory levels and are postponing some orders from 2023 to 2024.

"In the long-term," Pukk said, "the EMS business outlook remains positive. We remain committed to actively invest in our operations and develop them. In line with our growth strategy and supported with our solid financial position, we continue to focus on pursuing M&A.

"Our estimate is that our revenue and operating profit in 2023 will be lower than in 2022. We are nevertheless convinced that our decentralised operational model and our committed team will help to maintain the good level of profitability also in the future.”

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