IMPACT COATINGS AB (PUBL), YEAR-END REPORT 2020

2021-02-12

FINANCIAL RESULTS FULL YEAR 2020

  • Net sales amounted to SEK 39,515 thousand (49,084)
  • Total revenue amounted to SEK 54,355 thousand (39,366)
  • Operating profit amounted to SEK -22,970 thousand (-26,368)
  • Operating profit after financial items amounted to SEK -22,975 thousand (-26,387)
  • Cash flow amounted to SEK -29,153 thousand (32,116)
  • Liquidity ratio amounted to 343% (666)
  • Order backlog at period end amounted to EUR 1,645 thousand (289)
  • No dividend is proposed

FINANCIAL RESULTS FOURTH QUARTER 2020

  • Net sales amounted to SEK 20,044 thousand (20,574)
  • Total revenue amounted to SEK 29,078 thousand (8,069)
  • Operating profit amounted to SEK -5,243 thousand (-3,986)
  • Operating profit after financial items amounted to SEK -5,246 thousand (-3,990)
  • Cash flow amounted to SEK -6,553 thousand (59,693)

SIGNIFICANT EVENTS FOURTH QUARTER 2020

  • No significant events during the fourth quarter

SIGNIFICANT EVENTS AFTER THE PERIOD

  • Coating system order for radomes received from HELLA MINTH Jiaxing Automotive Parts Co., Ltd. (China)

CEO’s COMMENTARY

For Impact Coatings, 2020 ended with an intense fourth quarter. We completed the production of three coating systems: one for a German technology supplier to the textile industry; one for HELLA in Slovenia; and one for our development partner Hyundai in Korea. All three machines were shipped from our facility in Linköping, Sweden. Installation and acceptance of the coating machine for Germany was completed during the quarter, while the installation in Slovenia was somewhat delayed from the original plan but was completed in January. Installation of the Hyundai machine is planned for the first quarter of 2021.

The activity level in Coating Services continues to increase and resulted in a very good fourth quarter. Customers are primarily within the fuel cell, decorative coatings, and electrical contact segments. Full year sales have increased consecutively in each of the past three years, since Coating Services became a more distinct part of the company’s strategy.

In addition, we completed a smaller coating system sale during the quarter. A European automotive supplier had rented an INLINECOATER™P200 since the end of 2018 and decided to exercise its purchase option in the rental agreement. The overall deal structure has been beneficial for the company while it also demonstrates our flexibility in meeting the varying needs of our customers.

In late November we opened a branch office in Seoul, a result of our Joint Development Agreement with Hyundai. With specialized technical expertise now in place, our development work in fuel cell coating solutions with Hyundai is more efficient. The office will also serve as a regional hub for our sales activities across all application areas, primarily in Korea, China, and Japan.

Hyundai is increasingly recognized as one of the global leaders in the growing hydrogen economy, above all in future transportation systems. This illustrates the potential for Impact Coatings in our cooperation initiated during 2019. We experience daily that our joint development work with Hyundai gives us credibility in our discussions with existing and potential customers, whether vehicle manufacturers or automotive suppliers.

2020 also became the year that the world – industry, politicians, media, and investors – genuinely began to appreciate the potential of hydrogen in tomorrow’s fossil-free energy systems. Korea, Japan, and China have been pioneers both politically and industrially, but in 2020 the EU Commission launched a comprehensive hydrogen strategy with significant investment goals in the expansion of green hydrogen production, storage, distribution, and application development. In industry, there is now an ongoing positioning of technical approaches, with consolidation and cooperation among large players, often in unexpected constellations. Impact Coatings – with our patented coating solutions for fuel cell flow plates – is uniquely relevant for the market opportunity that hydrogen electrification presents.

It is becoming increasingly clear that the company’s second strong pillar lies within automotive safety and autonomous vehicles, where Impact Coatings offers cost-effective coating solutions for mission-critical plastic components. The two system orders for radomes, radar-transparent emblems, that we received during 2020 are important steps forward in this new market. This is further strengthened by a system order for the same application from HELLA MINTH in China during February.

We also see strong potential in our coating solutions for radar antennas that are placed behind the radome, as well as for plastic antennas that will be manufactured at low cost and in high volumes within the automotive industry and for IoT and 5G. During the fourth quarter, we signed a framework agreement with Swedish antenna innovator Gapwaves for plastic metallization coating services linked to a cooperation that Gapwaves has with the American company Uhnder. The framework agreement does not guarantee order volumes nor does it specify a production start date.

Quarantine rules and other COVID-19 restrictions are challenges for a global supplier of advanced technology like Impact Coatings that require solution-oriented and agile planning for the whole organization. I am confident that Impact Coatings, despite the pandemic, has advanced our market position in both hydrogen/fuel cells and automotive safety. During the past year, we expanded our sales organization with a sales director for Southern Europe and we opened the sales office in Korea. During 2021, we will optimize and accelerate our sales activities and increase our local presence in key markets.

Beyond our focus on sales and a broader geographic footprint, we are working with machine and process development, not least to meet expected volume demands from our customers. We are also continuing the industrialization of our machine production, targeting higher efficiency, lower input costs, and shorter lead times.

The ability to deliver – as we have proven despite the pandemic during the year – is one of our competitive strengths and the result of true teamwork. This applies to our coating systems, aftermarket sales, and Coating Services. I would like to congratulate and thank the entire Impact Coatings team for its professionalism and hard work during the past year.

Torbjörn Sandberg, CEO

The full report is attached, and can be retrieved on the company’s website at www.impactcoatings.com/finansiella-rapporter-arkiv/.


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