Morning, ladies and gentlemen, and welcome to the conference call regarding the Financial Results 2020. At this time, all participants have been placed on a listen only mode. The floor will be open for questions following the presentation. Let me now turn the floor over to your host, Leslie Isken.
Good morning, everybody, and welcome to our conference call on the full year 2020 results. My name is Leslie Ilzkin, Head of Investor Relations and Corporate Communications at Genoptic. With us today are our CEO, Doctor. Stefan Treger and our CFO, Hans Dieter Schumacher. Doctor.
Treggor will give a brief update on the business and point you to the key highlights of our full year results and the key developments in the divisions And of course, an outlook on full year 2021. Mr. Schumacher will cover the key group financials in-depth. As always, both will be happy to answer any questions you may have in our Q and A session at the end of this call. Also, let me remind you that this call will be recorded.
A replay will be available on our Investor Relations website after this call. Before I hand over, please also kindly pay attention to our usual disclaimer that you will find in the presentation. It is now my pleasure to hand over to our CEO, Stefan Treggor. Please go ahead.
Thank you, Leslie, and very good morning from my end here, from our end at Lovely Sunny Jena. This is our first call our first earnings call together actually. Let me just use the opportunity and say great to have you on board. Great to have you presenting an update.
Thanks a lot.
Pleasure and welcome. Hey, how to describe the year like no other really? Of course, COVID Has dominated 2020 for us in many ways. It's challenged us, it's taught us a lot. We had to learn a lot.
You know what? We decided that today we're not going to talk about COVID. Well, at least we're going to talk about COVID and the pandemic as soon as possible at least. Maybe we all are growing a bit tired of talking about it. Besides that today, we will talk about our strength as a company.
We talk about our innovation power and how we can make the world a better place with more light actually. So despite all the challenges that we have, that society faces today and in this world, I'm going to say that Genoptic, and I Strongly believe that it's a very strong company, and we believe great investment into the future. Let's kick off with some highlights of 2020. And if you follow me to Page 4 of our presentation, We would like to remind all of us on what I believe is the year, maybe the biggest milestone in the company's recent history. Within 2020, we've managed to pull off the biggest acquisition of Genoptix, say, in recent history, essentially in the last decades, With TriOptics being another new star within the Inoptic family, we have entered the Field of test and measurement, optics for mobile devices.
And I mean, we all look ever more into all sorts of cameras. We carry with us mobile phones and tablets and demand for laptops grows ever bigger. We all use video conference to the nth degree, and the quality of the optics in those mobile devices It's essentially one of the key selling feature. I was saying earlier last year, the quality of an image that we take off Mobile phones is mind blowing. It's as good as the quality of an image that we used to take a few years back as professional cameras.
Image quality It becomes one of the most important selling features of mobile devices and TriOptics Provides the broad standard when it comes to test and measure the quality of those optics during the production process. Bioptics has more to offer. There's a big future, we believe, in AR, VR, augmented and virtual reality. And all of that requires ever smaller optical sensors, ever smaller optical devices This ever higher quality, and again, quality needs to be improved, needs to be tested, needs to be measured during production process. And TriOptics is the gold standard when it comes to machines for test and measurement of those optics for mobile We believe that Draptics will positively contribute to the group earnings in years to come, as it already did in 2020.
And we do believe that we will see significant long term top line synergies from the acquisition. And as I already alluded to, as I guess you all know by now, TriOptics is way above Group average and fleet average when it comes to profitability in this business. So as I say, Trioptics, to me, probably the biggest The event is the most important highlight of the last year. However, there have been plenty more. And then the next few pages We'll show you a bunch of other things that we've been particularly proud of in terms of achievements 2020.
So if you follow me to Page 5, I'd like to remind you that we communicated the successful Winning of a very large order for production equipment for electric vehicles. The result of our New strategy of combining our laser processing devices with automated And integrated production tools for, in this case, particularly the automotive industry. Essentially, that does mean that there's a new strategy in light of production. We're now able to report the successful entry of in optics Into electromobility and alternative engine vehicle production. And as I say, I think that's a very important milestone development of our company.
On Page 6, we are proudly showing you another interesting image. There is a, Lunatic explores new world. We are very, very proud of the fact that the first images that Perseverance As transmitted to Mars, has been through our optics. The eyes of Perseverance are from Unuptake. Unuptake is Providing the camera lenses and the eyes essentially of the Mars rover.
And yes, it might not be the most important financial contribution to the company's development. I think it does show our innovation power. It does show what we are able to do. The conditions in that perseverance phase up there on Mars Are severe, obviously. The optics on Perseverance are produced in We need clean room standards and have to sustain harsh conditions.
And our experience in the semiconductor manufacturing world helped us a ton When it comes to developing and producing optics in such Challenging environment as even the surface of Mars, dare I say. Let me just say that Jose, it's not just a marketing gimmick for us. Yes, it's not necessarily the most important financial contribution to success of phenoptics. The fact that every image and all those images from Mars are seen through our optics. But it does not only actually Show and demonstrate our innovation power also helps us to really always continuing to be on the forefront and in cutting edge Of development, I mean, at the end of the day, I heard once a phrase that Perseverance is probably the most Autonomous vehicle in the solar system, most definitely the most autonomous vehicle in the solar system.
And To be challenged by participating in developments like that helps us, helps us as a company To stand on our toes, to stay on our toes and to stay highly, highly innovative. So we are proud of the fact, as I say, And the first images from Perseverance have been brought to us through ENOPTIC health scans, in other words, through ENOPTIC, optics assemblies. Let's go to Page Number 7. We're not only looking backwards today, but we wanted to give you Just a glimpse really of other things we're working on when it comes to innovation. We brought in The picture, an image of that depicts basically a photonic integrated circuit.
Well, you know that we are very, very active and I believe quite successful when it comes to devices, Machines for the production of electronic circuits, chips as we used to call it, chips based on silicon. There's a lot of discussion these days on the shortage of chips and on the investment that go into chips. I mean, if you have followed The news from Intel from yesterday, you know that a lot of investment is going into the chips. Maybe you have seen the latest communications also from Apple about their new chip Generations and what silicon chips are able to do these days. However, there's a bunch of people thinking about what's next, What's after silicon chips?
What comes next? What comes? What happens? Should newer floor ever break down? There's a lot of investment going into research these days when it comes to the quantum world, quantum communication, Quantum computing and the like in Germany, in Europe and in the entire world.
As a matter of fact, there's a lot of Funding going on currently in terms of quantum research, in particular, on European platforms. And we participate. We want to shape that. We want to participate in that development. I can't tell you today how much revenue this is going to contribute to the earnings In 5 or 10 years from now, nobody knows.
To me, it's very, very important that we're Participating, driving those new technologies beyond of what we do today. So we're really proud of what we've achieved in 2020 when it comes to M and A activities, when it comes to how we shape the portfolio of the in uptake, When it comes to continuation in our innovation, and yes, even when it comes to not just conquering Mars, But also pushing into the quantum world. Nevertheless, let's talk about financials as well because at the end of the day, What really matters is how much profit do we make with all of that. And if you follow me on Page 9, We have put together a couple of key takeaways in terms of financials and economic success in OPTIC in what has been admittedly difficult macroeconomic environment. We have reported throughout the whole year that we have seen quite mixed impact Actually, if the pandemic to our portfolio, I will go more in-depth into the details throughout the presentation today.
But I did say throughout the whole year that we see almost like a bifurcation actually in our marketplaces. Some of our businesses have had We've entailed it. The pandemic acted almost like a as a catalyst To the digitalization of our world, our businesses have been in choppy waters and have had challenging market conditions. We take it all together, though integrated over the entire portfolio and including the effect of the consolidation of Drauplex in the Q1, Revenue of the group has declined by minus 8.3% versus prior year. That's not nice.
We would rather want to sit here Explaining growth in double digit figures. But I would say that overall, and again, given the difficult macroeconomic environment, We're okay with that. We can manage. The adjusted EBITDA clearly exceeded our own forecast And what we could call prior year, we have adjusted our margins for quite a number of onetime effects. You do see further Down in the next bullet point, actually, that we invested more than €19,000,000,000 in 2020 to make our business better, To improve our portfolio, to improve our efficiency, our productivity, and we wanted to Make that transparent, we always said throughout the year that we will report in 2020 both in adjusted and in reported EBITDA figure to Parent, there is particular effects, which will have positive effects onto our profitability in 2021 already and Definitely in 2022.
Nevertheless, we're proud of the fact that despite this difficult economic environment, we managed to produce And adjusted EBITDA before PPA effects out of the resulting from the On the Drauplex acquisition of 17.6% of sales. We talked about our Structural and portfolio measures already. Nevertheless, and despite the fact that we've invested significantly Into those efforts to make our business better, we still have a very, very solid Financial and balance sheet structure. We have just yesterday placed an important milestone in the financing of our company. We'll talk about that more throughout the presentation.
But in summary, Inoptic is strong. We have a strong balance sheet, At a strong liquidity position, we are well poised for further growth and investment into the future. We do propose to the AGM a dividend payment of €0.25 per share, which is More than last year, but not quite at the pre COVID levels. We believe that this is We hope at least that we with this proposal, we find the right balance in light of the ongoing economic uncertainties, the right balance Between, on the one hand, our desire to invest into further growth and on the other hand, to let our shareholders Participate on the financial success of our company. For 2021, we do expect significant growth And further profit expansion, and we're very, very confident when it comes to this running fiscal year.
Of course, and we will talk about that at the end of the presentation. Of course, there are uncertainties out there. We have to mention that. But overall, and by and large, We are a strong company. And yes, as Cedar mentioned earlier today already to me that and he was late actually.
Sometimes throughout the last year, I said that I don't even have enough fantasy to think about negative profit numbers for an uptick. Maybe that was a play statement actually at the time, but in hindsight, I'll stand behind that. We are a profitable company all the way through the bottom of the P and L, all the way to earnings per share. And I think with that said, I'll hand over, Hansita, to you and to take us through the numbers in detail. I feel you.
Thank you so much, Stefan. Thank you. And a very warm welcome from my side here as well from our beautiful town in Vienna. Hope you are all doing well. Well, let's go on the next page.
It's Page number 10 with The order intake and the order backlog figures. And you see here, all in all, we reached 739 point €4,000,000 order intake last year. It's slightly less figure than in the year 2019, minus 6 0.7%. Obviously, if you have followed us the last year from quarter to quarter, obviously, We must have had a strong Q4, and that's true. With 228,500,000, It clearly exceeds all the prior quarters in the year 2020.
And It leads us to a more comfortable feeling that we can go with this development on a strong base in 2021. So Strong order intake, of course, including roughly around about €27,000,000 from TriOptics acquisition because we The main impacts in quarter 2 quarter 4 from last year. Stefan already mentioned that we had a Declining in some project postponement or the intake because of Some project performance and order cancellations due to the COVID-nineteen pandemic. But the good news behind and you will see later on in Our profitable figures and margins, all kind of margins from gross profit throughout even to the earnings per share, You see that we had a huge improvement there because of the product mix impact because our semiconductor business And our safety business, the light and safety and light and optics, there the heavy business Have been very strong, and that helped to reach the high profitable level Genoptic reached last year. On the order backlog side, you see that we have just reached nearly the prior year with €460,100,000 is only €4,000,000 a little bit and €4,000,000 below last year with €464,700,000,000 it's 1 percentage point.
So it's nearly the same level. And it's including the order backlogs of Interop and TriOptics with 47,500,000 We assume that we will convert 78.5 percent of the EUR 460,000,000 Into revenue in 2021. This gives us also a good feeling for the 2021 development. If you then follow me please on the next page, on Page number 11, you see the revenue split Quarterly. And here, you see also a +2.5% Increase in revenue and sales in the Q4 spend alone compared to the prior Q4 in 2019.
Obviously, it's including the positive contribution of TriOptics in Q4. TriOptics in Q4, it's mainly TriOptics Because InterOp consolidated already since February. All in all, both have helped us with EUR 47,200,000 Within the €767,000,000 but in Q4 figure, it's roundabout €28,000,000 coming from TriOptics alone. And I mentioned already, we had a strong and good business with the semiconductor equipment industry and the public sector, which helped us in the profit line. The revenue decrease in Light and Production Division, And it's not only driven by COVID-nineteen.
Maybe COVID-nineteen pandemic has accelerated a little bit, But the industry has gone through a structuring anyhow with the electrification. So COVID-nineteen also accelerated it a little bit. But and then we had other businesses In the aviation business as well as in the biophotonics areas, nobody went to the doctors to have the eye treatment in the last year. These three areas have been influenced by the COVID-nineteen pandemic clearly, But we have overcompensated it with a strong nearly. And in profitability, you will see it's nearly the same level in absolute like in the prior year, and it's driven by semiconductor and public sector business, which helps a lot.
If you then go with me on the next slide page, you'll see the revenue by market and the revenue by region. Let me just highlight 2 markets. It's the Automotive Mechanical Engineering Business. You see that our share of total revenue Decreased from 35% to 30%, which is already mentioned from us. And very important, the semiconductor equipment, Which increased its share from 20% to 22%.
This is very important for you in optics. And on the right side, I'd like to highlight our Asia Pacific figures, where we have seen a growth. You all remember that China, Special China, has been the 1st economic Clayson, the world who recovered first from COVID-nineteen pandemic, as we see here a growth in our books. And in Europe, it's nearly flat. It's constant.
No decrease, which is very helpful. Obviously, it's influenced by the semiconductor business because all our Dutch customer is in this figure here. And in Americas, let me say some words to the Americas development, which is clearly below prior year with €195,500,000 Compared to €238,300,000 it's driven by 2 impacts. 1 is the automotive business, Which we have in Canada and northern part of U. S.
In Detroit area, which has obviously declined. And Our optic business in the southern part of U. S. Has been influenced by COVID-nineteen, where we have been We have a business and entertainment business, entertainment parks and cinemas. And obviously, COVID-nineteen pandemic did not allow people to go to entertainment park or to cinemas anymore.
This is why our business has been poor also there. So this will recover in the if you have, again, open spaces for the people worldwide After having gotten and then Victor, yes. The revenue of the foreign revenue is stable at 70 2% of total revenues. If we then go please to the earnings figures, So Page number 13. Here you see then the comparable The adjusted EBITDA figure, you see it here, and it's €130,700,000 It's adjusted by our structural and portfolio measures of 19
€100,000
If you take this out and in the prior year, we have €4,000,000 So the net impact is €15,000,000 comparable because we want to compare apple with apple, so to speak. And you see a 17% EBITDA margin and nearly the same absolute EBITDA figure like in 2019 with much more sales. This is what I mentioned already. And if you take out of the EUR 130,700,000 also the purchase price allocation effects from The inventory step up at Keyoptics and the EBITDA at €4,600,000 in the last year. And to answer your question, In 2021, you will see €1,800,000 for the whole year, and we have booked it in Q1 already.
So it's done through for the rest of the year. That's all from the inventory side and from the EBITDA impact. So if you take this out, we would have also even reached 17.6%, which Stefan already mentioned. And this is a very strong development. And we see the Q4 figure alone with €56,800,000 compared to €45,600,000 And it's clear that the TriOptix is Very high and profitable contribution before PPA contributed
in the
Q4 figures already. The not adjusted EBITDA, let me highlight this also. As reported, with EUR 111,600,000 And equaling to 14.6% is also a very strong result we all reached together In COVID-nineteen year, yes? So not so bad. If you then look at EBIT figure, EBIT figure is at 7.8 adjusted, it's €78,800,000 which is equaling to 10.3% Compared to prior year, why is it a little bit more down compared to the EBITDA figure?
This is because of the purchase Allocation impacts, which we have booked here, all in all, it's EUR 14,900,000 Because there you see the huge impact, which has been shown by TriOptics below the EBITDA, yes? So it's It's below the EBITDA, yes? So it's including the EUR 4,600,000 inventory step up. I mentioned already, It's a much bigger figure from TriOptics. In total, It's €8,300,000 in the EBIT alone.
So this is the reason why the EBIT figure is a little bit Lower than the EBITDA figure. The non adjusted EBIT, let me highlight this. So as reported, It's €59,300,000 equaling to 7.7% margin, which Let our CEO make the statement that she cannot imagine to see what figures, and it's really reality. We have shown even reported a very good development if you take into account what happened last year. And If you then go with me to the P and L figures on the next page, Page number 14, You see what I already mentioned, the product mix impact, our gross margin even was a little bit higher for 30 4.2% compared to 34.1%.
In last year, I have explained it already. If you look at the functional costs, which are €2,000,000 roughly €2,000,000 below prior year, you could ask the question, why is it only €2,000,000 Because we have taken out a lot of traveling costs because we did not travel as much as in the prior year, so we saved a lot of traveling costs. Yes. Saved already also personnel costs, roughly around about worldwide EUR 10,000,000 There are roughly roundabout €3,000,000 coming from Kotzebueld in Germany. The rest has been mainly contributed in U.
S. And Canada Because in the businesses which have heavily been influenced, like the automotive business, like in production, We had to take this as I mentioned into account. But we did not see it here in the Whole amount because we had counter effects with the acquisitions, TriOptics and InterOp. Obviously, We got hundreds of colleagues new into the group. And therefore, the functional costs have been increased by the 1st, consolidation impact of these acquisitions.
But all in all, we have been happy to manage the costs in the year Without taking too aggressive into the organization because we have been working on some very interesting projects In R and D and sales, where we think it will pay off in 2021. So all in all, we are quite happy with the development. The EBITDA and the EBIT, I have already talked about. The earnings before taxes has reached CHF 53,200,000, Including, obviously, the portfolio measurements and the earnings after taxes with a tax rate of 19.7%, driven by the acquisition of TriOptics and very good development outside of Germany. We have 19.7 percent tax rate realized.
So finally, we ended up with earnings per share of €0.73 per share, which is a very good Outcome from our point of view, and we are very happy that we managed to show this strong Select figures to the last earnings figure. And if you then look with me shortly into the Free cash flow statement on the Page number 15, which we have shown here which we are showing here, You see that, obviously, because we had lower operating income, our cash flow from operating activities It has been roughly €20,000,000 below prior year. On the investment side, we have not very much taken out of our investment. So we have We invested €40,000,000 compared to €44,000,000 So all in all, our free cash flow before interest and taxes has reached $62,300,000 We are very proud. This was one of our main targets in the beginning of the pandemic to keep cash To collect cash and to keep the cash in the company, to save the cash, and we have This result here, although we are quite happy, the adjusted figure is a little bit higher, EUR 67,200,000.
Our equity ratio It's come down to 51.5%, but it's still a very, very strong figure. What is the reason behind Obviously, we have the full balance impact of the first consolidation of the huge TriOptics group, Which pulled up our balance sheet by €400,000,000 to €1,400,000,000 1,500,000,000 But on the P and L side, we have only realized A quarter. So this is a little bit of mismatch between P and L and balance in the last year. This will improve in this year, obviously. But this is the reason why the equity ratio has come a little bit down, but it's still in a region where we are very happy with.
And the working capital which increased is also coming from TriOptics. We have written it here. You can read it. And let me say now some words. Trevor, yesterday, Successfully placed EUR 400,000,000 debenture bond.
We are very proud Let me say a very important point. I'm sure our CEO will say some words to the later on. It's For both of us, it's very important that we have done it with green components to support our sustainability Efforts within our company, also in finance department, we have been overbooked by far. Our intention was to collect EUR 200,000,000. So we like to take the EUR 400,000,000 With us, we are very, very happy that the investors have shown this confidential Behavior into our group and our company, and we have done it very short and very precise.
So we are happy That we have now the means to support our strategic development of our company from the investment side, And this gives us freedom to operate, so to speak. We take half of it, roughly half of it To refinance in the first step, the financing from the acquisition of TriOptics, We will take it out of the ZYN loan financing, take it in the debenture bonds. So this means, in other words, Our SIMDOG is again free to take some money, which we may need out of it. And the other part, we will use for investments in M and A or in our business development at the site of CianOptik Worldwide. Having said this, and I'm sure our CEO will take over and make Some statements concerning our ESG criteria, we took into account in this step in Jabon.
And I'm happy to give you To reach I'll turn it over to Stefan, who will go with us through the development of our division in the last year. Stefan?
Yes. Thank you, Hans Peter. Well, yes, no need to particularly On the Demantri part, I think we're really, really, really proud of the fact that it's been always subscribed quite significantly, actually. And yes, we intentionally Linked it to ESG criteria. The criteria is about diversity in our business.
We want to make Enoptic a more diverse place. Quotiers around economic and environmentally friendly water, Ways of conducting our business, we'll talk about certain criteria about No. Green energy, about vitality and access to business and the like. For us, sustainability is not just a word. It's not just a buzzword.
Everybody talks about sustainability. But for us, it really does mean that we believe sustainability shouldn't be just a marketing Tools. Sustainability is something that's here to make our business better in the long run. So therefore, We use that component in the Debitro part, but not just there, but really in our entire sort of How we conduct business? Anyways, let's go to the individual divisions actually.
Let's go to light and optics first, if you follow me on Page number 17. We basically are very proud of the fact that the light end optics continues To develop very, very strongly, certainly pushed and supported by an ongoing strong development in the industry. I mean, there's a lot of talk about the chip shortage in the automotive industry these days. Yes, I mean, let's face it, There are a lot of there is a lot of demand for chips in automotive in cars and automobiles. But in reality, there are even bigger end markets for chips.
And maybe that's an issue that some of the Friends, the automotive industry didn't really sort of take into their considerations. Anyways, there's a lot of investment going on In new factories, if you have just followed and I alluded to it earlier, the Communication with Intel yesterday, I think they talked about US20 $1,000,000,000 over the next few years to be Put into new factories. As you see what friends at TSMC and Qualcomm are doing, it's really amazing. And obviously, I mean, we're not selling to those chip manufacturers directly. We sell to Those folks who produce machines, which will be placed into these factories, for sure.
And that, I'm pretty sure, Generate demand, high demand and strong demand for our products for, dare I say, years to come. So really very positive here. You do see that in our figures as well. Order intake rose by 11.4% In 2020, yes, in the Q1, supported by the trioptics consolidation effect. But throughout the whole year, We have seen strong demand, in particular, in the semiconductor industry.
Revenue declined somewhat for Light and Optics. Ancira alluded to that already. It's Predominantly due to the fact that our Life Science and Healthcare business, I. E, our biophotonics business, has been in choppy waters. We talked about that throughout the whole year 2020.
It is a bit counterintuitive. There is a big pandemic out there and we are saying healthcare and life sciences and difficulties. And it is due to the fact that a large part of that business of ours is actually geared towards what one could call aesthetic procedures, Removal of tattoos, removal of hairs, lasing eye correction and the like. And I used the phrase, nobody is going to the local tattoo parlor these days, let alone trying to get rid of a tattoo apparently. That's not a structural problem.
It really is just a COVID effect. And once COVID is lifted, I fully expect this business to come back. And as a matter of fact, we do see signs of that already in recent months. So overall, very happy with the development of Liza and Optics. Also, when it comes to EBITDA margins, There is and again, Hansi, there are leases already.
There is a mix effect here. We have a very profitable business in semiconductor. And Yes. If anything good, then COVID acted as a catalyst to the digitization of our world. So therefore, this high margin business should continue to grow for us to see the future at least and should help us in the profitability of Leiden office.
We're very happy with that business. Let's go to lighter production, Page number 18. And obviously, lighter production is in really, really challenging market conditions or in 2020. You might recall that in light of production, we basically have 2 parts of the business. We produce production equipment For automated production environments, that's a combination of our laser processing business or lasers to cut And well, the field and stuff and on the other hand, robotic based automation solutions.
And on the other part of the equation, on the other side of the equation, we have a metrology business. The metrology business is Geared towards combustion engines predominantly for historic reasons. And that Part, the metrology part is really under pressure, continues to be under pressure, and that is actually a structural problem, which we addressed. And a big part of the one time effects that you see between the adjusted and reported EBITDA margins is attributable to the fact that we do invest Into making that business better, into making it more effective, more efficient and preparing it for the future. Nevertheless, in the other part, in the production tools and production equipment part, We have seen quite a lot of uptake actually in the later part of the year.
There was a lot of money Claimed to be spent by car manufacturers to enter the Age of electromobility in 2019 and then not a lot of that actually became liquid in 2020. As a matter of In 2020, sort of in the summertime, it was as if hell froze over. There was basically very little, if any, movement in the pipeline. We have seen in the Q1 2020 order intake in that business, Even quite some big orders, which we then had to count even cancellations in the Q2 of 2020. To some extent, that has been that lock has been lifted.
We as I said earlier, we part of the fact that we could report Orders for fairly large tender actually with electromobility in the mind. There are other projects like that on the horizon and in the making. Not everything we do win, obviously, but we do see more activities when it comes to capital expenditure in the automotive industry, and I think the entire industry is saying the same thing. So since Q4 and beginning of this year, there is certainly more, Nice to say more demand for capital expenditure in the automotive industry. Nevertheless, it has to be said that order intake Our lighter production business declined by almost 21% in 2020 and sales by almost 22%.
Obviously, that did have an impact on the profitability of the business. EBITDA margin declined to 8.8% of sales, But it's still a profitable business for us. Let's put that in perspective. We're not losing money here. Yes, Light and production is in challenging market conditions.
It is in the transformation phase. But still, it is a profitable business. We are making money in this That's it. Let's go to Life and Safety, Page number 19. Yes, Light and Safety is always a bit of a challenge what to say.
I mean, on the one hand, we're saying It's a good business. It's a strong business of ours. It's in very good market conditions. And that Fact remains. We have stable capital spending patterns, in particular, in the public sectors and with our public sector customers.
Communities continue to invest into safety on the roads and safety of public places. And obviously, that helps us. On the
other hand, you do see auto
intake actually declining, Which might be a bit of a surprise given that we throughout the whole year talked about this business being in good conditions. Well, fact of the matter remains that it is a very lumpy business. It's a project business in which you either win tenders or lose tenders. You don't have big tenders every quarter. So There are ups and downs.
There's a lot of lumpiness in that business. Overall, though, we really want to stress that the business is in very good shape. We have seen growth of revenue by about 5% in 2020, and we have seen margins to further expand, EBITDA margins of almost 20% in 2020, which is very strong development, very strong cash flow in that business. So we are very happy and continue to be very happy with how life and safety developed, in particular, in 2020. Last time, the lead zinc Orion on Page 20 of the presentation.
Yes, zinc Orion has been In challenging conditions, in particular, in the second half. I think we alluded to that throughout the entire year last year. It was foreseeable. In the Q1, Vincorion had good market conditions and the crisis hit. It was clear that There will be an impact, in particular, on the aviation part of Vincorion.
But given the long term nature of that business, we have That up until summer also, that Vincorion is having good demand out there. But it was clear that it's going to change, particularly in the second half, and we do see that impact, that effect. I have Personally, it's just been on the steering committee call for a project that we did together with Airbus. Not an important project, but it's I just wanted to point out that doing business with Airbus and Boeing and those customers, those partners is not This is already fun these days. So in other words, the aviation part of Incorion is in challenging market conditions.
So that part of the business represent about 25% of Encorean, And obviously, that does have an impact. You do see that order intake in 2020 from incroyon declined by 18.4% versus prior year, And revenue was well declined by 7.9% versus prior year. It's still as well a very profitable business for us. We are not losing money there. As a matter of fact, it's also a business that continues to provide stable cash flows.
It's almost CHF 10,000,000 free cash flow. Nevertheless, it is and remains to be below fleet average when it comes to profitability and growth targets. That said, Overall, and if you take it all together, I think that as I said in the beginning, I mean, yes, we did see challenging conditions in 2020 in some markets. We did see good conditions in matters. And if you integrate over the business together and over the portfolio, yes, we have seen revenues decline In high single digit figures, we would love to sit here saying, hey, we grew 10%.
But overall, We can manage. I think we have a strong business. We have shown that operationally, this is a healthy company. We have shown that we can produce profits all the way down to the bottom of the P and L. We have a strong balance sheet.
We have a good liquidity position. So we're actually looking forward to what's going to come in 2021, Also based on our innovation power and what we do guide and expect for 2021 It's a further growth year. We do expect to grow the business, obviously, including the effect of the consolidation of Triaptics In a low double digit percentage range, we guide for EBITDA margin To be between 16% 17%, I do realize this is a very broad corridor, And I ask for your understanding here. At the end of the day, well, here in Germany, we don't even know what we're going to do next Thursday, I would say. And just to illustrate that It's not easy at the moment to predict health markets develop.
We have, as I say, some of the markets where we are pretty certain that we will see continued and strong growth. We have other markets where we, quite frankly, have to see what the next months are going to bring. So we come with a fairly broad corridor. We want to specify that and narrow the corridor in the course of the year. Let me further mention that we Compare the 16% to 17% EBITDA with a 14.6% prior year figure, not with the 17.6%, just to To put that in perspective, and we believe that with that, we actually guide To have and to achieve an EBITDA margin for EN uptick, which we originally intended to achieve in 2022 in our strategic cycle.
So we are fairly certain that we will achieve our strategic Targets for 2022 a year earlier despite of the fact that we are just going through the biggest economic crisis in recent history. And I think that's something, yes, let's say, to be proud of. Basis for the development in particular is good order intake that we have seen in the 4th Quarter 2020, well filled project pipeline and continued promising development in the semiconductor business, That should give us tailwind throughout the whole year. When it comes to efficiency And profitability, we believe that we will see effective restructuring measures that we have taken already. It should Impacted our business already in 2021.
Although not to the full impact, we do believe that the full impact of our profitability improvements Should be visible in 2022. Let me finally just close with a few words Sort of in the mid- to long term outlook, if I may. We do believe that we are very Well positioned to participate in the growth and actually drive and shape the growth of Photonic Markets. We believe that Photonic Solutions, solutions based on life, will drive growth of marketplaces That equates to about 2x the global GDP growth. And we, as I say, are determined to Not just participate in that market growth, but actually to drive it to shape it.
And just to mention a few factors Behind that, we talked about digitization. We talked about the fact that the COVID crisis acted as As a catalyst to the digitization of our world, there is an ongoing demand for our chips for really various applications. We do see, in particular, increasing usage of augmented and virtual reality. I said earlier today, I said that my A little voice actually showed me a video of a music group in virtual reality, which is really mind blowing. There is lots to come when it comes to virtual and augmented reality.
And we with our Trioptix acquisition will participate in that. I even talked about Quantum World. Now as I said earlier, I'm not quite sure if we see a lot of economic success in that in the next 1 to 2 or 3 years. But in the midterm, I am personally convinced that Quantum computing, quantum communication, the whole quantum world will be an ever more important factor In our everyday lives. When it comes to health and to evermore human beings getting access To increasing therapies, diagnostics, bioimiting and the like, obviously, we We are well positioned there when it comes to Genome sequencing, when it comes to digital pathology, when it comes to laser based therapy, all of those end markets and applications are They're to grab for us, and we were determined to utilize that factor that we have there and the important demand that we see out there.
We talked about our understanding of sustainability. And to me, Smart manufacturing is a big factor here. We do have to find ways to, yes, make the world a better place at the end of the day. We have to find ways to preserve resources of this planet. And on the other hand, we have to find ways to continue to manufacture our products And the product of our customers and with smarter ways of manufacturing, we contribute to that.
And that's not just, let's say, Something for like green activists is actually an economic factor. And with green photonics, We can participate on that. We can drive that. We can generate growth and margin expansion based on sustainable development. When it comes to mobility, there's no question that augmented reality, that automated Driving that intelligent use of our infrastructure Has to be the future.
And with our products, our solutions, we participate in there. We drive that. And so if you take it all together, we're pretty sure that Enoptic will not just participate in the market development, which is already very interesting, But based on our innovation power, it can drive and shape that future. And therefore, we believe that Enoptic is actually a good investment into future development. With that said, let me stop here.
Paul is here. Looking forward to receiving your questions. But I think, Leslie, you wanted to Round it up or are we going straight into Q and A here? Yes.
Thanks, Stefan. I'm sure there are Quite some questions, which is why I would like to ask the operator to open the line for the Q and A session. Go ahead, please.
The first question comes from Craig Abbott. Please, your line is open now.
Good morning. Can you hear me?
Yes, we can. And we admire your telephone skills, by the way, pressing buttons, your phone.
Okay. That was pretty fast, yes. Okay. Good morning, everyone. Just two questions, please.
The first one is just if maybe you could give us an update On your M and A strategy, obviously, you raised the $400,000,000 bond yesterday, as you mentioned. And I'm talking both regarding your thoughts currently looking forward with Vincorion on the one hand, but also at least conceptually, What type of acquisition targets you might ideally be targeting? And the second question is Just to get a feel for on the net cost savings you're expecting from the $19,000,000 in restructuring measures you implemented, I. Normally, you have to, of course, pay a bit more than the actual savings. So I mean, you're looking at a factor of 1.2, 1.5 And are any further restructuring measures expected in 2021?
Thank you.
Yes. Sure, absolutely. In terms of let me address it, the second part first, in terms of cost savings, just so that we Yes. We're clear here, not the entire €19,000,000 has been for restructuring. A bigger part of it though, I think it was in total about
EUR 15,000,000
for For restructuring, I think about 10 for like in production or thereof and roughly 8 and the rest for other parts of the group, in particular, admin And other parts of the group. So about 15 of the 19 for restructuring. And my sort of rule of thumb is that you see typically, yes, you mentioned The fact that they're ready and you see typically half of the impact in the 1st year and the full impact in the 2nd year. That would be my sort of Yes. I was wondering if this is 1.5 years and half of it sort of coming in this year.
In terms of M and A strategies, well, when it comes to acquisition, We continue to look for possibilities to strengthen our portfolio, in particular, in the optics and photonics world. Something like trioptics, knowledge is always a good thing. I think there is a big future in image analysis, In other technologies around taking an image, analyzing an image and then further on Gaining intelligence from that image to all things around optics, photonics, image analysis, as you envision that type of stuff We're interested in we're also interested in expanding our portfolio in light and safety where it makes sense. Those are the main sort of technological and application wise, the major and main fields. From a regional perspective, we are interested in expanding our Light and Production business, in particular in Asia, But I don't think that will be a big thing.
I think for light in production, we're seeing more maybe technology And both of acquisitions, I think Leitman Production has to digest the acquisitions that they've done lately. So Yes. In summary, I'd say continuation of the strategy that we have followed throughout the last 2, 3 years, really, focusing on optics, focusing on photonics, essentially more focus. That's what we're talking about.
And Vincorion? Vincorion,
sorry. Yes, good point. Yes, apologies. Vincorion No worries. Vinkorian, no, I didn't try to ask the question.
I really didn't. It's actually on my paper notes here, but I wrote it down. That's okay. On the Coriant, look, I mean, we basically said throughout the whole year, we have After the active structural selling process for at the time, we didn't Thanks and the offer that we didn't have an offer at hand which reflected the value that we believe the business believes the business has. Of course, that was pre COVID and before the aviation crisis hit.
Yes, hindsight is 2020 vision, as we say. So Yes. You never know. We did say at the time that despite the fact that we Stop the active and structural process. Should somebody call, we'll certainly pick up the telephone.
And Throughout the year, I did say a number of times, I had a number of telephone conversations. But nothing really sort of concrete and tangible, nothing To a point where we would say that we have to reclassify Binkorian In our IFRS balance sheet, as an asset for sale, for that, we would have to have Profitability more likely than not for a deal to happen, and we're not at that point at the moment.
Okay. But you remain directly open to it. And might it, if you were to address that at a later stage, Would you maybe have to think about splitting out some of the civil aviation activities?
The first part of the question, yes. The second part of the question, that one I actually do touch. Okay. Got it. Yes.
Okay. Full stop. Okay. Thank you
very much.
And the next question comes from Richard Schrum. Please go ahead.
Yes. Hello, gentlemen. Two questions, if I may. Just One following up on the inquiry on topic, more or less all Companies in the aerospace sector have made quite significant capacity cuts. What about your efforts In this respect, how much fuel scales back the capacities in Aviation related activities of incorion?
Or if not, there's still work you have to do To take care of the obviously clearly dampened Longer term outlook in this sector here and should this relate also then to some extra costs maybe In future, yes, that's the key one topic you could please elaborate a bit on. And second point, The metrology business, we have heard, especially over the recent months, that More and more OEMs declared their exit of the combustion engine and The time frame becomes shorter and shorter in this respect. And if I'm I think you're wrong. A lot of your business here is tied to the combustion engine. So we'll obviously lose its markets in a foreseeable future.
How are you going to cope with this? And if there are not time for a more massive Restructuring here or maybe even an exit of this business as it obviously has no clear future at the moment here.
Thanks. Yes. Thank you for those two questions. When it comes to Incyorion in terms of capacity cuts, It's not that much production capacity actually. I mean, the production of aviation and the other parts of the business Are almost like mingled together and intertwined, but we have a fairly large Program going and changing the setup of the business away from business unit structures, from a vertical Set up to more sort of functional structure, horizontal structure setup.
We are going to right size I think Coriant, we are in the process of doing that. We actually spent money and efforts on that, which is Not driven by or not started by the aviation crisis. I mean, as a matter of fact, We thought about that before COVID already, but certainly accelerated by I think that's the best way of putting it, accelerated and Maybe the cuts are a bit deeper than what we originally expected because of the aviation business. You are right. We do not expect the aviation business to come back Massively and quickly, I think that will take way longer.
When it comes to metrology, Here, we are actually taking significant steps. The reduction of workforce, Reduction of capacity in metrology is fairly significant. In all parts of our metrology organization in and outside of Germany, That is fairly I mean, we're not talking well, It is let me just say it is a fairly significant restructuring effort. I think even more importantly is Actually, your question for the long term future of that business, and I we believe that it's our duty To have a vision there and to have at least ideas of what we can do with that business, we have to see But the way we see it is, I mean, the original strength of what used to be the homozygous in drilling and Svenneman, right, The original strength of this business has been to test, to measure the quality of surfaces of Machined parts. The problem that this business faces is that parts are Machine in Asia these days and not necessarily in the Southwest of Germany anymore.
We have to find a way to get more access for this business to the Asian customer base. And that to me is the big reason. I mean, you're absolutely right. Combustion engines produced in The Southwest of Germany is not necessarily the future for that business, that's for sure. So we need to find a way to get more exposure to Asia.
We're talking about Actually transferring parts of the production from metrology to our production sites in China, Significant parts. We have to do that because if we don't produce in China, there's a chance that we actually And get our hands on those customers there and successfully tap into the customer base that we unfortunately do not have In our camp these days in Asia. So that for us is the future. I think to say that And let me just stop here. I think that's important.
We do have a vision for that business. It's a business that's part of our portfolio for now. We do take significant restructuring steps all the way to even moving production to Asia. And I think that's What we can communicate at this point.
And just for clarification, this Shift in your production setup towards Asia or will this support then in the next year's additional investment, Of course, quite obviously setting up new production facility and all related Work such a step here. And will this then For another reduction in the European headcount or is We've already done the measures you implemented last year.
We have accrued The costs that we foresee for the reduction in the workforce in Europe in full in 2020 We started the discussion with unions and the Workers' Council already in December 2020. So we have accrued All the money that we need for the reduction of the workforce in Europe. There might be additional expenses that we need to set up. Facility in China, we do have a production facility in Pudong in Shanghai. We might need additional investment into machines and parts, But that should come out of the ongoing business.
So no further adjustments to the EBITDA.
Okay. Thank you.
You're welcome. And again, a challenging but important question.
And the next question comes from Maile Schouman. Your line is open now.
Yes. Good morning. First question is on order intake in 4th quarter, actually split in 2. First on semiconductors, Even despite the consolidation effect of TriOptics, Q4 orders have been pretty strong. Is it all about semiconductors and then both In Trioptics, at Trioptics and in your optics business?
Or is there anything else? And then order intake in the lighter production business Seared to be a bit on the weak side. I mean, Q3 was pretty strong with €56,000,000 And in early November, my impression was that you were not too negative about the order development so far in the quarter, now 36 in the 4th quarter is quite a bit below the Q3 level. So did in the end, Did you do some contracts with the postponement of order placements that made look Q4 then a bit weaker than maybe initially expected?
Actually, there were let me start with the item production. There were A bunch of tenders going, we participated in, in the Q4. And you're right, in November, We were more hopeful that we can land some of those in the Q4 December timeframe. Unfortunately, that didn't happen really. Let me be in all transparency here or Full transparency, one cycle, we didn't win.
We basically lost the competition. And some stuff have been postponed. We do see some of those postponements coming in Q1. But I will Just as a warning to manage expectations, remember that in March Let me just put it up. LMP has a very strong order intake in the beginning of the Q1 of this year, now with January, February.
But and again, manage expectations. In March 2020, we did take a large order into the book, Which we then had to take out again and cut out and take out of the orders book in the second quarter. Yes. So the comparison in March will be very, very challenging, just sort of to manage expectations for the Q1 Let's just say, from a market perspective, at least the 1st 8 weeks of the Q1 have been good. Okay.
Light and optics, It's been across the board really, I'd say, in the Q4. I don't remember a particular effect. I would say that We did see good even in the biophotonics world,
it was sort of a
bit back to normal actually. We have a funny effect actually here. We have one of our LASIK factories, laser diode factories in Berlin, This is now having very long lead times again. There's a bit
of an up and down and
a roller coaster. And they see even actually a very strong demand. So no, it's across the board, I would say. Yes, I would expect there was tailwind from the Trioptix acquisition and other than that across the board in the Q4 And continued strong development in the 1st 8 weeks of the new quarter.
Okay. Sounds good. Then I'll take a question on TriOptics. If my math is wrong, then TriOptics should have reached something lying in the mid-70s of sales in 2020, which does not really imply growth in comparison to 2018 2019, although it was to be a high growth business, I know you can elaborate on that. Was there kind of a postponement project, probably some COVID impact?
So take the numbers of the Consolidation consolidated revenue, you the €815,000,000 you would have reached, including Assuming the trial picks and interop would have been consolidated at the 1st January, that's the comparable number I take here.
Yes. Your calculation is correct. And look, I mean, Obviously, going through an acquisition is a challenge for every company. And I would say the fact that we Trioptix on a full year basis hasn't seen any decline in order intake and sales. I I think it's helpful.
It's promising. Obviously, yes, as I say, to go through a fairly lengthy M and A process is defocusing the management and it's defocusing the business somewhat. Love to see. I mean, we have from our perspective, as we described, we have Struck a deal in which we do have significant earn out and bonus and Malos compensation We'll in the 1st and the second year. So we made sure that there is, on the one hand, a Strong incentive of the management to continue to push hard for further growth in 2021?
And on the other hand, should that not transpire for whatever reason To be on the safe side and to have lots of safety nets when it comes to the impact on the Enoptic Group. So we have to see. I mean, at the moment, we do believe that the traffic It's a strong growth business and they have a very strong order backlog. Let's wait until I just pointed to the order intake and the order backlog, which is very strong. They have good order intake in Q4.
But I just wanted to remind all of us that we do have, Yes. Let's call it safety net. So precautions, we have struck a deal that has a significant earn out component or multiple significant earn out components In the contract.
Okay. But your expectation is that growth returns in the current year?
Yes, that's the expectation. Yes.
Yes. Okay. Thanks.
And the next questioner is Peter Rodenager. Please go ahead.
Yes. Hello, gentlemen. I also want to come back to TriOptics. Can you give us some Guidance or expectations to what could be the expected sales volume Try Optics in 2021 and 2022.
So Peter, you know that we do not guide on particular products and businesses, business lines of ours. That's the policy that We apply and we stand behind that policy. We have acquired Traptics to be a further growth engine In the business, obviously, as I said earlier, There has been a challenge in 2020 in terms of managing both growth of the business and in parallel A lengthy acquisition process by the management of management of Therapeutics to now focus completely on growing the business. They do have a strong pipeline. They do have a very strong order book.
On the other hand, we have to see how it develops throughout the 2021 2022. We Do expect this business to work. That's why we acquired it as a growth engine and a business that's in terms of profitability way above fleet average. But you will understand that we do not give specific guidance on individual businesses.
At the time you acquired TriOptics, I mentioned, I think it was 27% EBITDA margin. Is this still Level which is still correct.
Well, we again, we do not guide on particular businesses, What neither in growth, more in profit numbers, but it's a business that's certainly way above fleet average when it comes to profitability. And it's a business that should continue to be better than average even for the Light and Optics So it should help Light and Optics division to improve its margins even in percentage of sales. I think that gives you at least a more floor.
Okay. Then with regard to your guidance, You're expecting low double digit sales growth. So low double digit could also be 20% or something like that. So do you mean low teens in growth? Or should we see the possibility that That should could also be in the range of 15%, 17%, 18% or something like that.
Look, I mean, you know You know that we're maybe sometimes even on the conservative side when it comes to guidance. But We do believe that there is yes, there is just so much uncertainty still out there. I don't want to mention it next Thursday anymore. I shouldn't do But there is a lot of uncertainty out there at the moment. And that's why we're Really very careful.
It is hard to predict at the moment. We don't know to what extent the 3rd wave Of COVID will impact us. Of course, we do all we can to keep the virus out of our own factories. We are fairly successful thus far. We have isolated cases, but by now we could isolate Everybody trades people very, very quickly.
And I do keep saying that our clean rooms are probably the safest place actually. But there are a lot of uncertainties, which is why we are so, so, so careful in how we phrase our guidance. And We would leave it there in terms of low double digits. And Obviously, that does mean it's going to be a bit more than, say, 9.9%. But it's double digit.
But other than that, we have to see. We will give you more guidance once we have Clearly, I think that
was between 1520 or between 1015. Well,
no, I think he did say, Do we expect it within the teens? And the question is what teens is? Do you mean 13 or Teen or is 11 part of the teens or let's not debate that. We stick to No double digit sales calls for now, and we see how things develop.
And then with regard to the EBITDA guidance, you mentioned you take the basis the 14.6% or 9% Reported EBITDA. And we had, as you mentioned, €19,000,000 one off there of €15,000,000 restructuring expenses. So as far as I understood, you do not expect that in 2021, we will see Significant restructuring expenses. On the other hand, we have some positive impact from these measures. We have sent the consolidation of Trioptix, which could add perhaps on the group figures 100 basis points margin improvement.
So can you please explain where
Look, again, the calculation It's interesting. And obviously, we also do similar Models and we dial certain numbers into our models. We will see further one off effects In 2021 as well. We talked about Vincorion to some extent, where we will have to spend a bit more on Restructuring, we also hopefully will have to spend money on M and A activities, And that's also an impact that we have in our adjusted figures. So it will not go down to 0.
There is one time and one off effects. That's for sure. But we Yes. We nevertheless want to be measured on reported EBITDA going forward. We always said this is a 1 year event that we sort of Say adjusted and reported.
Now the actual calculation is pointing to the fact that We have a fairly large corridor. We do see a lift up from the 14.6 And expansion of margin to somewhere between 2016 2017, and we will guide A bit more once we have more clarity, in particular how the Coriant developed, how light in production developed, how our metrology business developed. And I think those are the areas to watch, I'd say.
With regard to semiconductor, you mentioned and we all know this business is currently booming. What growth rates Would you be able to do in the semiconductor equipment business? I think that the key issue are capacity restraints here.
Yes. I guess that's true. It's capacity. At the very moment, we would be able to sell way more laser diodes out of Berlin. We would be able to sell more From a demand perspective, I would say that our business in micro optics together with our Customers in the Netherlands, it's fairly predictable at the moment, as always.
We can manage that. But by and large, it is Capacity, and by capacity, we mean some extent production tools, but probably even more are engineers experts and people, they only they already are back to working Saturdays in semiconductor factories or Factories for the semiconductor manufacturing world, to be more precise, we are back on weekend shifts. And As we discussed the number of times throughout the year, I mean these are not sort of engineers that we can pick up the trees Out there. So that is the biggest constraint that we have, people, experts.
So are you able to do double digit sales growth with these capacities in the current year?
We will certainly be helped by the consolidation effect for trioptics. The double digit
On only the semiconductor?
I can't really answer the question, to be honest. Not that I don't want to, but I really don't know. But what I Because we are fairly at the I'm actually at the limit there, but it's getting to a point We are limited by the capacity, but we have already started investing into Further production expansion in our Dresden factory, we communicated that at the end of last year. We invest into production equipment, further lithography tool for microstructural upticks based on electron beam technology. And we have just yesterday actually decided that we will Also invest into further real estate in what's called silicon sectioning.
We will expand our factory there. Further communication to come, But at this moment, we decided that we will definitely grab some land, expand real estate and then we have to See how we what we build on that real estate and how we equip whatever we build on that real estate.
Okay. And my last question is on housekeeping. You mentioned PPA for 2020 was, I think JPY 14,900,000. Can you give us here your calculations for 2021 then clearly including the full year for TriOptix?
And Dieter, Peter, welcome. Yes, you're absolutely right. It was EUR 14,900,000 in 2020, They are of €8,300,000 for TriOptics because we did acquire Automax. You remember, we did acquire Interop. So all in all, it has been 14.9 percent in the EBIT and 4.6 percent in the EBITDA last year.
Within your calculation for 2021, you missed the reduction of roughly EUR 2,000,000 in the EBITDA because we will have EUR 1,800,000 EBITDA PPA impact in this inventory step up from the optics in 2021, yes? Then it's gone in the EBITDA. And in total, it will be EUR 15,200,000,000. This is the in our calculation, the maximum amount of purchase price allocation in the next years, Yes. From 2021 onwards, it will dilute.
In 2022, we are calculating 12.1. So you'll see in which direction it's Going, yes? So the highest level will be in this year, 2021 And it's EUR 15,200,000,000 which we calculated in the EBIT. And in the EBITDA, as mentioned, is EUR 1.8 Inventory step up, part 2 from Quala OPTIX. Yes?
Okay. Thank you.
You're welcome. Thank you, Peter.
There are no further questions now.
Okay. Then I would say thank you everybody for joining the call today. And should there be any follow-up Questions after this call, then don't hesitate to contact us also at Investor Relations, and we'll be happy to answer any questions you may still have. Other than that, a good remainder of the day and a successful remainder of the week as well. Cheers and