Nanofilm Technologies (MZH) Q4 2024 earnings summary

Executive summary

• FY2024 revenue reached S$204m, up 15% year-over-year, with 2H2024 contributing S$122m, a 17% YoY increase, driven by peak production and strong consumer end-market demand.

• Adjusted EBITDA rose 31% YoY to S$52m, and PATMI for 2H2024 was S$11m, up 6% YoY, reflecting improved profitability despite higher depreciation and expansion costs.

• Global expansion included new production bases in China, operational facilities in India and Vietnam, and the acquisition of AxynTeC and EuropCoating in Europe, enhancing market reach and supply chain resilience.

• Sustainability initiatives achieved 100% renewable energy sourcing in Shanghai, a 60% water recovery rate, and a 32% recycling rate, alongside inclusive employment growth.

Financial highlights

• Group revenue grew 15.4% YoY to S$204.3m, with Advanced Materials-Consumer up 24% YoY and Advanced Materials-Industrial up 30% YoY.

• Adjusted EBITDA margin improved to 25.4% in FY2024 from 22.3% in FY2023; net margin increased to 3.8% from 1.8% YoY.

• Operating cash flow remained positive, though higher working capital needs offset gains due to increased sales in Q3.

• Book value as of 31 Dec 2024 was S$430m, with a total cash balance of S$110m.

Outlook and guidance

• Cautiously optimistic for continued recovery in Advanced Materials-Consumer, with growth expected in Asia and Europe, and further diversification in customer base and geographies.

• Advanced Materials-Industrial anticipates growth in 2025, especially in semiconductor and e-mobility, with new projects in Europe and Southeast Asia.

• IEBU expects a turnaround in equipment orders for 2025, with new business in photonics and automotive segments.

• NFBU to broaden applications in optical health sensing and automotive sectors.

• Sydrogen aims to double BPP output, commercialize ACFC, and expand maritime power modules, leveraging continued government support in China.

• Focus remains on global site expansion, technological innovation, and renewable energy solutions for sustainable growth.