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• Gross Profit Margin: Over 66% for the year.

• EBITDA Margin: 31.2% despite infrastructure and R&D investments.

• Order Growth: Orders up 84% in semiconductor and sales up 22%.

• Market Share Increase: Increased by 2 percentage points in semiconductor.

• Spec Wins: Achieved 132 spec wins, a new record.

• Revenue Exposure: 80% in semiconductor, 15% in Advanced Industrial.

• Geographic Revenue Distribution: Two-thirds of products and services end up in Asia.

• Net Income: CHF212 million, up 11%.

• Free Cash Flow: CHF183 million with a conversion rate of 62%.

• CapEx: CHF56 million or 6% of sales.

• R&D Spend: CHF61 million, up 13%.

• Net Debt-to-EBITDA Ratio: 0.3x.

• Equity Ratio: 58%.

• Dividend Proposal: CHF6.25 per share, unchanged from 2023.

• Q1 2025 Sales Guidance: Expected between CHF275 million and CHF295 million.

• Warning! GuruFocus has detected 6 Warning Signs with WKCMF.

Release Date: March 04, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• VAT Group AG (VACNY) achieved a gross profit margin of over 66% and an EBITDA margin of 31.2% in 2024, despite significant investments in infrastructure and R&D.

• The company returned to growth in 2024, with semiconductor orders up 84% and sales up 22%, indicating a recovery from previous low sales levels.

• VAT Group AG (VACNY) increased its market share in the semiconductor sector by 2 percentage points, demonstrating the effectiveness of its strategy to outgrow the market.

• The company achieved a record number of 132 spec wins in 2024, which are expected to contribute to future sales growth over the next 3 to 5 years.

• VAT Group AG (VACNY) has expanded its operational footprint, with significant progress in its facilities in Malaysia and a new project in Romania, positioning the company for additional growth.

Negative Points

• The semiconductor market experienced a transitional year in 2024, with a shift towards more mature nodes and a higher share of legacy lithography tools, which are not vacuum tools, delaying growth in adjacent products.

• The company's Advanced Industrial segment faced challenges, with solar demand being a significant disappointment, resulting in a reduction in overall exposure in this sector.

• VAT Group AG (VACNY) faced adverse FX effects and a record R&D spend, which impacted its financial performance despite the overall growth.

• The geopolitical and market environment remains uncertain, with potential risks from export restrictions to China that could affect demand for VAT Group AG (VACNY)'s products.

• The company's CapEx intensity remains high, with significant investments planned for 2025, raising questions about the sustainability of this level of spending in the future.