Press Release: Feintool: Fast recovery after the sales drop due to COVID-19

Despite the impact of the COVID-19 pandemic and the continuously

difficult market environment Feintool was able to close out the 2020

financial year with an EBIT slightly in the black in the amount of CHF

3.3 million. For the full year, net sales dropped by 22.2% to CHF 492.0

million; the EBIT margin amounts to 0.7%.

The progress of the pandemic worldwide and its impact on business

activities cannot be assessed conclusively at the present time.

Nevertheless Feintool remains optimistic about the future, as the

international automotive industry -- the group's most important market

-- is showing clear signs of recovery in Europe, Asia, and the United

States, and promises to remain a growing global market between now and

2035.

Feintool took advantage of the year 2020 to continue refining its

corporate strategy for the period through 2030 and, with its products

and technologies, is well positioned for the transformation process in

the automotive industry. Lasting improvements were achieved through

measures to increase efficiency and cost-effectiveness. As such,

Feintool's plants are positioned for highest efficiency. The company is

active in key markets with high-performance sheet-metal technology for

the automotive market and for industrial applications. Feintool's

precision components and their applications enable the future of

individual mobility possible.

Net sales

The Feintool Group generated net sales of CHF 492.0 million in the 2020

financial year, which corresponds to a decline of 22.2% (19.1% in local

currency). Both segments suffered a significant decline in sales: the

press and tool business shrank by 40.6%, and the parts business

decreased in local currency by 15.7%.

EBIT

The Feintool Group generated operating profit (EBIT) of CHF 3.3 million,

corresponding to an EBIT margin of 0.7%. This contains one-off effects

in the amount of CHF 0.3 million; without one-off effects, operating

earnings amounted to CHF 3.0 million.* Operating earnings generated by

the System Parts segment fell to CHF 16.7 million.* Thanks to the

measures aimed at increasing efficiency which were rapidly implemented

following the drop in sales, the EBIT margin in the parts business

decreased by a mere 0.4 percentage points to 3.6%. The capital goods

business of the Fineblanking Technology segment suffered more severely

from the slump in sales and posted a loss of CHF 4.9 million.* Similar

to the previous year, research expenses came in at CHF 4.4 million.

Development activities continued unchanged -- as an investment in the

future -- despite the difficult environment.

Group result

All in all, including the one-off effects, this resulted in a

consolidated loss of CHF 3.9 million. The Board of Directors proposes to

the General Meeting to refrain from distributing a dividend for the 2020

financial year.

Pleasing development in the second half of the year

Net sales

In the second half of the year, Feintool sales in Europe and the United

States developed in line with the market. Thanks to many new products,

Feintool underwent above-average development in Asia. Consolidated sales

still sank by 3.4% -- adjusted for currency effects -- to CHF 279.7

million. While the press and tool business experienced a sales decline

in the second half of the year as well, the parts business grew --

adjusted for currency effects -- by 1.1% to CHF 266.8 million compared

to the same period in the previous year.

Operating profit (EBIT)

In the second half of the year, the Feintool Group generated earnings

before interest and taxes (EBIT) of CHF 20.4 million*, corresponding to

an EBIT margin of 7.3%. Thanks to the measures implemented during the

first half of the year, operating earnings of the System Parts segment

doubled to 26.1 million*, corresponding to a margin of 9.8%*. The

capital goods business of the Fineblanking Technology segment showed

signs of significant improvement, but still remained at a loss.

Group result

All in all, the second half of the year -- without one-off effects --

resulted in net income of CHF 13.6 million; the profit margin thus

amounted to 4.9% during this period.

(* Without one-off effects. Figures see table below.)

Feintool may make use of additional market opportunities

With the goal of quickly making use of opportunities that present

themselves on the market, the Feintool Board of Directors recommends to

the General Meeting of April 20, 2021, that it create authorized capital

in the amount of 1 000 000 shares -- corresponding to 20.3% today's

share capital -- with the possible exclusion of subscription rights for

existing shareholders.

Outlook

Uncertainties about the impact of the coronavirus crisis and shortages

in the supply of semiconductors and steel for the automotive industry

continue to weigh on expectations and make it difficult to issue a

forecast for 2021. Market forecasts continue to anticipate production

volumes below those of 2019.

On the other hand, combating the pandemic through efficient hygiene

measures and vaccinations on a sufficient scale will have a positive

impact on business trends in the automotive sector. We continue to see a

reluctance to invest in new machinery, although the first encouraging

inquiries from Asia and Europe are helping to revive the business. The

long-term competitiveness of our technologies in times of structural

change in the automotive industry remains the key success factor.

Through our "Strategy 2030," we have laid the necessary groundwork and

set a milestone -- with streamlined structures and processes,

state-of-the-art machinery, and innovative mobility concepts, Feintool

is extremely well equipped for the future.

Feintool expects sales to increase in line with the market in the 2021

financial year and profitability to stand significantly higher than in

the previous year.

About Feintool

Feintool is an internationally acting technology and market leader in

the business area of fineblanking. This technology is characterized by

high-quality-standards and cost-effectiveness. The company produces

fineblanked goods, formed steel components and punched electro sheet

metal products.

As an innovation driver, Feintool is consistently expanding the horizons

of these technologies and developing smart solutions to meet customer

requirements. Feintool offers complete production of precise fineblanked

and formed components as well as punched electro sheet metal products in

high volumes for demanding applications in the automotive, industrial

and energy industry.

The processes used by Feintool are ideally suited to implement

automobile industry trends. Feintool is a project and development

partner in the field of lightweight construction/sustainability, module

variations/platforms and alternative drive concepts such as hybrid and

electric drives.

The company, established in 1959 and headquartered in Lyss, Switzerland,

runs production plants and technology centers in Europe, the United

States, China and Japan. It is crucial to the company to at all times be

geographically close to its customers. Around 2,700 employees and 80

apprentices work globally to develop new solutions and create key

advantages for Feintool customers.

Key financial indicators overview

2020 2019 Change Change in local currency

in CHF million in CHF million in % in %

--------------------------------------------------- --------------- --------------- ------ ------------------------

Net revenue of the Feintool Group 492.0 632.7 -22.2 -19.1

--------------------------------------------------- --------------- --------------- ------ ------------------------

Fineblanking Technology segment 44.2 74.7 -40.9 -40.6

--------------------------------------------------- --------------- --------------- ------ ------------------------

System Parts segment 464.3 573.9 -19.1 -15.7

--------------------------------------------------- --------------- --------------- ------ ------------------------

Earnings before interest, taxes, depreciation, and

amortization (EBITDA)(1) 53.3 67.7 -21.3 -17.1

--------------------------------------------------- --------------- --------------- ------ ------------------------

Earnings before interest and taxes (EBIT)(2) 3.0 18.9 -84.1 -80.0

--------------------------------------------------- --------------- --------------- ------ ------------------------

Fineblanking Technology segment(3) -4.9 0.7

--------------------------------------------------- --------------- --------------- ------ ------------------------

System Parts segment(4) 16.7 23.2 -27.9 -24.5

--------------------------------------------------- --------------- --------------- ------ ------------------------

Group result -3.9 10.7

--------------------------------------------------- --------------- --------------- ------ ------------------------

Total assets 677.1 706.3 -4.1

--------------------------------------------------- --------------- --------------- ------ ------------------------

Shareholder's equity 293.9 309.9 -5.2

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March 02, 2021 01:00 ET (06:00 GMT)