SEE:NanoFilm Technologies: Tech firm that taps IP to build moats and drive growth
FY2020 gross profit rose 54.2% y-o-y to $119.8 million, while gross profit margin (GPM) increased 0.6 percentage points to 54.9% for FY2020, driven by the group’s operations leverage as a result of economies of scale arising from higher levels of production, increased efficiency of the group’s operations through automation and improved manufacturing work processes. Profit after tax stood 68,1% y-o-y higher at $58.1 million, as the group benefitted from economies of scale and “boosted by operational excellence”. Operationally, Nanofilm recorded a utilisation rate of 74% in the Advanced Materials Business Unit, which is “relatively stable” from 71% in FY2019. This comes after the addition of 73 coating equipment in the plant throughout FY2020 to a total of 176 coating equipment. On the other hand, the Industrial Equipment Business Unit recorded a revenue of $24.6 million, a 10.1% decrease from $27.4 million in FY2019, as it “remains selective on equipment sales to external customers.” The majority of coating equipment manufactured during the year were retained within the Group to support the Advanced Materials Business Unit. As such, Nanofilm said the group continued to generate strong positive net operating cash flows amounting to $59 million for FY2020.
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The company added it intends to strengthen its value proposition as a provider of technology-based solutions through synergistic M&As or strategic partnerships, focusing on integration across the product value chain to drive sustainable growth. For long term strategic objectives, Nanofilm continues to maximise its core technologies in mission critical applications in new end-markets that are in favourable secular growth trends, in line with its vision of integrating nanotechnology into the daily lives of end-consumers. “Since 1999, with our technology ecosystem and value propositions, we have shown a strong track record in acquiring and retaining customers, including market leading blue-chip end-customers in multiple mission critical applications and products. Our relationship continues to strengthen over time as we are typically engaged in the early stage of our customers’ development and design process, to mass production and continuous product enhancement, providing our customers with value-added services using our proprietary differentiated nanotechnology solutions,” says CEO Lee Liang Huang. “To maintain our technology leadership and stay ahead of competition, we will continue to invest and build on our three core competencies – our R&D innovation and product development, inhouse engineering and efficient production capabilities,” Lee adds. Shares in Nanofilm closed at $4.64 at Feb 26, 18 cents lower and 3.73% down compared to the day before.