Highest turnover in the 30-year history of the company
Solid earnings development with significant increase in operating result
Proposed dividend of EUR 0.15
USD 6.5 billion order backlog thanks to new projects
FACC AG was again able to benefit from the global market environment of the aerospace industry and achieved solid growth in the 2018/19 financial year. In terms of sales, the aerospace group posted the highest value in the company's history. Profitability and order backlog also developed well. An investment program is currently in progress to ensure the necessary capacity for the forecasted growth.
"2018/19 was a very dynamic year for FACC. On its 30th anniversary, our company successfully continued its evolution, achieving the highest turnover in its history and a solid result,” said Robert Machtlinger, FACC CEO. "The good business result of the Group is based on our enormous innovative strength and the associated competitive strength. Positive long-term market forecasts, growth through innovation and efficiency coupled with the high motivation of the FACC crew ensure our success."
In the 2018/19 financial year, the FACC Group generated revenues rose by 4.5 % from EUR 747.6 million to EUR 781.6 million. The main drivers of product sales in the 2018/19 financial year were the programs for the Airbus A320 family, Airbus A350 XWB, Boeing 787 as well as the Bombardier and Embraer Business Jets and the associated engines. The first significant series revenues were generated also with the aircraft manufacturer COMAC in the financial year 2018/19.
Operating earnings before interest and taxes (EBIT) increased significantly in the past financial year from EUR 44.9 million to EUR 55.0 million. Reported earnings before interest and taxes amounted to EUR 43.6 million and included the one-off effect of the EUR 11.4 million resulting from the write-down of unamortized development costs in connection with the discontinuation of the A380 aircraft program planned for 2021.
Capital expenditure amounted to EUR 35.7 million in the reporting period and was part of a multi-year investment program with a total volume of over EUR 100 million. The focus was on the development of new projects, expanding production capacities, and on measures to increase automation and digitization in the Group's operating divisions.
As of February 28, 2019, the total headcount of the FACC Group stood at 3,465 full-time equivalents (FTE); (previous year: 3,402 FTE), with 91% of the total workforce - 3,170 employees - employed in Austria. Under the motto "Great place to work", FACC is strengthening its image as an attractive employer with numerous measures ranging from company health promotion, further training and internal junior staff trainee programs to family-friendly initiatives.
The payment of a dividend of EUR 0.15 per share will be proposed to the Annual General Meeting scheduled for 9 July 2019.
Outlook
The current market forecasts of the aircraft industry once again confirm that, from today's perspective, the long-term growth trend in the civil aviation industry will continue in the future. Studies by OEMs currently confirm a constant annual increase in passenger volumes of around 4.5 %. Between 2019 and 2037, approximately 40,000 new aircraft will be needed. Compared to the 2018 forecast, this represents an increase of 2,500 aircraft. The latest rate forecasts for the next two years, in contrast, show that the increase of some aircraft types has stabilized and will be somewhat flatter than anticipated a year ago.
With its balanced and comprehensive customer and product portfolio, FACC will continue on its growth course in the 2019/20 financial year and, based on its current market assessment, expects sales growth to be in line with market growth. Changes in the product mix, in particular the discontinuation of the A380 aircraft program, will be compensated by the new orders acquired in the last two financial years.
FACC will continue its efforts to reach the sales target of EUR 1 billion in the 2019/20 financial year by actively shaping the market. Due to the above-mentioned flattening of rate increases in existing projects, this goal is not expected to be achieved before 2021/22.
In line with the planned revenue growth, FACC intends to keep earnings at the level of the 2018/19 financial year although various new orders were introduced. Due to the introduction of the new projects described above, the margins in the first half of 2019/20 will be lower than the half-year margins of the 2018/19 financial year. "We are doing everything in our power to achieve fixed cost degression through targeted operational measures and to further increase profitability - with the aim of compensating for natural cost increases," said Machtlinger. "Over the past 30 years, we have consistently worked on the technological development of the company and have risen from a start-up to a world-class group. We are proud of the past 30 years, but we will not pause for a moment. On the contrary, we are going into the next 30 years with full vigor".
FACC AG’s Annual Report 2018/19 may be viewed on the Company’s website, www.facc.com, under the link https://www.facc.com/en/Investor-Relations/Financial-Reports.