Release Date: February 07, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: Can you provide some insights into the growth development by sub-segments within the EMC business, particularly automotive versus telecom, and the operating leverage achieved with the 20% organic growth? A: Growth was observed across all sectors, with telecom contributing significantly to the high growth rate this quarter. While the growth supports margins, it is not dramatically impactful. The favorable product mix across the business area supports the margin. Unidentified_3
Q: If you strip out EMC from the business, how close is Nolato to achieving a 10% margin, and what steps are being taken to improve operations outside of EMC? A: We have excess capacity in Asia due to a strategic decision to consolidate production, which affects margins. This capacity is intended to support new business growth, particularly in consumer electronics, which currently has a lower margin than the group average. Unidentified_2
Q: Regarding the new customer project in engineered solutions, will it improve utilization in Chinese production, and what is its expected size and timeline? A: We are not focusing on a single large contract but rather building growth through multiple areas, which takes time. This approach aligns with our plan and is progressing as expected. Unidentified_2
Q: With EPS growing by 50% and leverage at 0.4, why is the dividend being kept flat? Is there a cautious outlook for 2025, or is there an active M&A agenda? A: We aim to be ready for investments and acquisitions, feeling positive about future growth. The flat dividend reflects a strategy to maintain flexibility for expansion and acquisitions. Unidentified_2
Q: Can you update us on the GW Plastics acquisition in the US and your view on organic growth versus M&A? A: Organic growth remains the foundation, with acquisitions adding synergies or technologies. The GW acquisition, despite pandemic challenges, was beneficial, providing a strong geographical footprint. Future acquisitions will focus on adding technologies, with size being less critical than strategic fit. Unidentified_2
Q: How does the current IVD demand compare to normal levels, and what is the outlook for 2025? A: IVD demand has not returned to pandemic highs but has recovered from low levels. The focus is on improving margins through efficiency rather than relying solely on product mix effects. Unidentified_3
Q: Is the 20% growth in the EMC business a one-time occurrence, or could it indicate a structural recovery? A: The 20% growth was influenced by a weak comparison quarter for telecom. While growth opportunities exist, a 20% rate is not expected to be sustained. Unidentified_2
Q: What is the expected impact of the new customer project on the Chinese production capacity, and when will it be fully ramped? A: The project is part of a broader strategy to utilize excess capacity through diverse offerings and segments, progressing according to plan without a single large contract. Unidentified_2
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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