2020

10.03.2020 – Sensirion Holding AG

Sensirion Holding AG: Challenging 2019, Mid-Term Growth Perspectives Confirmed

Sensirion Holding AG / Key word(s): Annual Results
Sensirion Holding AG: Challenging 2019, Mid-Term Growth Perspectives
Confirmed

10-March-2020 / 06:30 CET/CEST
Release of an ad hoc announcement pursuant to Art. 53 KR
The issuer is solely responsible for the content of this announcement.

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Press Release
Stäfa, Switzerland, 10 March 2020

Sensirion: Challenging 2019, Mid-Term Growth Perspectives Confirmed

Sensirion experienced a challenging 2019 as a result of the reduced demand
and increased volatility in all markets, especially in the first half of the
year. In the second half of the year, the start of new business put
Sensirion back on a moderate growth path, which made up for part of the
decline in sales during the first six months. At CHF 171.0 million,
consolidated revenue was slightly higher than expected in summer 2019 (-2.2
% year-on-year), the gross margin was stable at 53.7 %, and the EBITDA
margin adjusted for one-time effects amounted to 12.0 %. Sensirion confirms
its medium and long-term growth prospects based on the long-term trends in
the markets as well as its full product and project pipeline.

Key Figures

     Consolidated, in               1 January - 31       1 January - 31
     millions of CHF                 December 2019        December 2018
     Revenue                                 171.0                174.8
     Gross profit                             91.8                 93.0
     - as % of revenue                       53.7%                53.2%
     Adjusted EBITDA                          20.4                 27.8
     - as % of revenue                       12.0%                15.9%
     Adjustments                               8.1                 18.6
     Cash flow from operating                 25.7                 26.4
     activities
     Capital expenditures                   (17.2)               (13.5)
     Free cash flow                            8.6                 12.4
                                 As of 31 December    As of 31 December
                                              2019                 2018
     Net cash                                 48.0                 42.6
     Number of employees                       796                  783
     (FTE)
A challenging and mixed 2019 lies behind Sensirion Holding AG, a pure-play
sensor company offering environmental and flow sensor solutions. In all
markets, reduced demand and increased volatility was experienced as a result
of the numerous geopolitical uncertainties and the crisis in the automotive
industry. Nevertheless, the start of new business in the second half of the
year put the company back on a moderate growth path. This made up for part
of the decline in sales in the first half of the year. Despite the
persistently difficult market environment, the long-term market trends as
well as the technology and product pipeline remain strong. A number of
important milestones in the company's strategic development were achieved
last year: firstly, by winning important projects and secondly, by further
expanding the portfolio of environmental sensors. These strategic advances
will support growth in the coming years. Sensirion therefore continues to
confirm its medium and long-term growth prospects.

Consolidated annual revenue reached CHF 171.0 million, -2.2% compared to the
previous year (of which -1.8% organic, -0.4% foreign currency effects).
Revenue was thus slightly above the upper end of the guidance that had been
lowered in summer 2019 in the wake of the overall economic slowdown. This
was achieved because of a stronger second half of the year, in which
moderate growth of just under 4% compared with the first six months was
achieved by means of new business. The gross margin of 53.7% remained stable
and within the communicated expectations. The EBITDA margin adjusted for
one-time effects reached 12.0% and, thanks to intensified cost management,
was at the upper end of the guidance revised in the summer. Due to high R&D
expenses (24% of revenue) and low variable product costs, adjusted EBITDA of
CHF 20.4 million suffered disproportionately from the decline in sales. In
view of the continuing strong medium- and long-term outlook, the high R&D
intensity was deliberately maintained. Taking into account one-time costs of
CHF 6.5 million in connection with the last tranche of the IPO Loyalty Share
Program, an operating loss of CHF 2.0 million and a net loss for the period
of CHF 2.7 million resulted. The operating cash flow amounted to CHF 25.7
million and the free cash flow to CHF 8.6 million.

Slight growth in industrial market, weaker automotive market, special effect
in medical market
The automotive market generated sales of CHF 51.3 million (-4.8% compared to
the previous year). The very weak first half of the year was characterized
by a significant weakness in demand coupled with inventory optimization
throughout the supply chain. Demand stabilized noticeably in the second half
of the year, so that, thanks to new business, growth compared with the same
period last year was achieved.

At CHF 35.1 million, sales in the medical market were 8.9% below the
previous year's sales. This decline is primarily the result of a base
effect: in the second half of 2018, temporarily strongly increased volumes
in the dominant sleep apnea therapy (CPAP) devices application were recorded
as two major customers were about to launch important new products and were
heavily building up their inventories. In 2019, demand in the CPAP area was
back in line with the long-term trend.

In the broadly diversified industrial market, moderate growth of 2.5% in
2019 compared to the previous year was achieved with revenue of CHF 70.3
million. Important new business in the household appliance applications,
especially due to the new CO2 sensors as well as higher sales in the gas
meter business offset the lower sales in some areas in the traditional
products business and in the sharply declining hard disk sector.

At CHF 14.1 million, the consumer market achieved a slight increase in
revenue of 3.1% compared to the previous year thanks to new projects with
gas and humidity sensors.

Strategic expansion of our environmental sensor portfolio
In 2019, good progress in implementing the strategic goal of achieving
market leadership in the entire field of environmental sensor technology was
made: the CO2 sensor launched at the beginning of 2018 substantially
contributed to consolidated sales for the first time thanks to product
launches with lead customers in the industrial sector. In mid-2019 the
second generation of CO2 sensors was also announced: through Sensirion's
expertise in sensor technology, MEMS and chip design, the size of the sensor
could be reduced to one-fifth without compromising performance, which brings
further advantages in the cost structure of this product. Initial market
feedback on the new CO2 sensor is very positive. Production start is
scheduled for summer 2020.

The particulate matter sensor (PM2.5) launched later in 2018 is also
developing positively on the market. As a result of further important
nominations in the industrial and automotive markets, continuous and
sustainable sales growth will also be achieved with this product family in
the coming years.

To further strengthen its environmental portfolio, Sensirion acquired a very
promising electrochemical sensor technology in mid-2019. In the meantime,
the technology transfer has been successfully completed and a larger
internal development team has started to develop a first gas sensor based on
this novel technology.

Medium and long-term prospects remain strong
Despite the current difficult market environment, the medium and long-term
growth prospects continue to be viewed as positive. The fundamental growth
drivers for sensor technology, such as energy efficiency, safety, health,
and increased living comfort, will continue to drive the growing demand for
sensor technology in all markets in the future. Sensirion's strategic
orientation, supported by the newly launched product families, the entry
into the automotive module business, and a full innovation pipeline, open up
numerous growth opportunities and a continuous increase in the value share
in important existing and new customer applications. Therefore, a high R&D
intensity is being maintained, also in comparison to competitors.

Renewal of authorized share capital
The Board of Directors will propose to the Annual General Meeting on 11 May
2020 that the authorized capital of CHF 145,581.70 be renewed for another
two years.

Outlook
Given the current rapidly changing situation, it is difficult to provide an
outlook for 2020: the global economic situation remains fragile and
challenging in view of the continuing tense geopolitical environment and the
unresolved coronavirus epidemic. Future effects of the epidemic on current
business and the supply chain are currently difficult to assess. Assuming
that the market environment and exchange rates do not deteriorate
significantly, we anticipate sales growth of 4-10% to CHF 178-188 million
for full-year 2020, with a consistently strong gross margin of 52-54%. For
the adjusted EBITDA margin, we expect an improvement to 14-16%. Based on the
progress in important R&D projects, we also confirm our medium-term annual
sales growth target of 10-15%.

Analyst and media conference on the full-year 2019 results
Today, Tuesday, 10 March 2020, at 10:00 CST / 09:00 GMT / 06:00 EDT, an
analyst and media conference on the full-year 2019 results will be held. The
conference will take place at the Savoy Hotel Baur en Ville in Zurich and
will also be audio-webcast with synchronized presentation slides. The
presentation will be held in English. You will have the opportunity to ask
questions following the presentation. If you would like to attend through
web access, we kindly ask you to register for the audio-webcast via the
following link: https://conferencing.swisscom.ch/conference/x/jXQBjyezGngc

Documentation
All documents will be available at www.sensirion.com/financial-reports on 10
March 2020 from around 06:30 CET / 05:30 GMT / 01:30 EDT onwards.

Condensed Consolidated Financial Statements

   Condensed Consolidated Income Statement                 2019      2018
   In millions of CHF, for the twelve months ended 31
   December
   Revenue                                                171.0     174.8
   Cost of sales                                         (79.2)    (81.8)
   Gross profit                                            91.8      93.0
   Other income                                             0.0       1.1
   Research and development expenses                     (41.5)    (36.3)
   Selling, distribution, and administrative expenses    (52.3)    (62.2)
   Operating profit (loss)                                (2.0)     (4.4)
   Net finance costs                                      (2.0)     (2.3)
   Profit (loss) before tax                               (4.0)     (6.7)
   Income taxes                                             1.3       0.3
   Profit (loss) for the period                           (2.7)     (6.4)
   Earnings per share (in CHF)                           (0.18)    (0.45)
   Diluted earnings per share (in CHF)                   (0.18)    (0.45)
   EBITDA                                                  12.3       9.2
   Adjusted EBITDA                                         20.4      27.8
   Revenue by End Markets                                 2019     2018
   In millions of CHF, for the twelve months ended 31
   December
   Automotive                                             51.4     53.9
   Medical                                                35.1     38.6
   Industrial                                             70.4     68.6
   Consumer                                               14.1     13.7
   Total                                                 171.0    174.8
   Condensed Consolidated Statement of          as of 31         as of 31
   Financial Position                      December 2019    December 2018
   In millions of CHF
   Current assets                                  108.8            112.3
   Non-current assets                              106.7            102.6
   Total assets                                    215.5            214.9
   Current liabilities                              17.9             21.1
   Non-current liabilities                          41.4             33.4
   Total liabilities                                59.3             54.5
   Total equity                                    156.2            160.4
   Total liabilities and equity                    215.5            214.9

   Condensed Consolidated Statement of              2019             2018
   Cash Flows
   In millions of CHF, for the twelve
   months ended 31 December
   Cash flows from operating activities             25.7             26.4
   Cash flows from investing activities           (17.2)            (3.6)
   Cash flows from financing activities            (1.8)             21.9
   Net change in cash and cash                       6.7             44.7
   equivalents
   Cash and cash equivalents at 1                   53.9              9.4
   January
   Cash and cash equivalents at 31                  60.3             53.9
   December
   Capital expenditures                           (17.2)           (13.5)
   Free cash flow                                    8.6             12.4
Financial Calendar
10 March 2020: 2019 full-year results and annual report
11 May 2020: Annual general meeting
19 August 2020: 2020 half-year results and interim report

Contact

Investor Relations
Andrea Wüest
Director Investor Relations and M&A
Tel: +41 44 927 11 40
E-Mail: andrea.wueest@sensirion.com

About Sensirion Holding AG

Sensirion Holding AG (SIX Swiss Exchange: SENS), headquartered in Stäfa,
Switzerland, is a leading manufacturer of digital microsensors and systems.
The product range includes gas and liquid flow sensors, differential
pressure sensors, and environmental sensors for the measurement of humidity
and temperature, volatile organic compounds (VOC), carbon dioxide (CO2), and
particulate matter (PM2.5). An international network with sales offices in
China, Europe, Japan, South Korea, Taiwan, and the US supplies international
customers with standard and custom sensor system solutions for a vast range
of applications. Sensirion sensors can commonly be found in the automotive,
medical, industrial, and consumer end markets. For further information,
visit www.sensirion.com.

Disclaimer

Certain statements in this document are forward-looking statements,
including, but not limited to, those using words such as "believe",
"assume", "expect", and other similar expressions. Such forward-looking
statements are based on assumptions and expectations and, by their nature,
involve known and unknown risks, uncertainties, and other factors that could
cause actual results, performance, or achievements to differ materially from
those expressed or implied by the forward-looking statements. Such factors
include, but are not limited to, future global economic conditions, changed
market conditions, competition from other companies, effects and risks of
new technologies, costs of compliance with applicable laws, regulations, and
standards, diverse political, legal, economic and other conditions affecting
markets in which Sensirion operates, and other factors beyond the control of
Sensirion. In view of these uncertainties, you should not place undue
reliance on forward-looking statements. Sensirion disclaims any intention or
obligation to update any forward-looking statements, or to adapt them to
future events or developments.

Certain financial data included in this document consists of "non-IFRS
financial measures". These non-IFRS financial measures may not be comparable
to similarly titled measures presented by other companies, nor should they
be construed as an alternative to other financial measures determined in
accordance with IFRS. As a result, you are cautioned not to place undue
reliance on any non-IFRS financial measures and ratios included herein.

This document is not an offer to sell, or a solicitation of offers to
purchase, any securities.


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