Asetek – Q3 2021: Q3 smoothly as expected – Long-term growth ambitions remain firm | New
Oslo, Norway, 28 October 2021 / PRNewswire / –
- Nine-month revenue of $ 61.7 million (+ 37%) and adjusted EBITDA of $ 6.5 million
- Q3 revenue of $ 13.5 million compared to $ 21.6 million in the third quarter of 2020; 3rd quarter gross margin of 39% vs. 47% the previous year
- Q3 Adjusted EBITDA from negative $ 1.4 million, compared to $ 5.4 million in the third quarter of 2020
- The results are consistent with the update provided on September 22
- Single charge of $ 1.7 million in operating expenses for the exit from the HPC data center niche
- Orders for SimSports products opened in Q4, with an R&D investment of $ 0.8 million in T3
- Asetek Technology Embedded in First AIO Liquid Cooling Solutions from Global Gaming Leader Razer
- Group revenue growth forecast of 10% to 20% maintained for 2021, current revenue outlook tending towards the lower end of the range
Asetek reported sales of $ 13.5 million, compared to $ 21.6 million during the same period of 2020. Sales for the first nine months were $ 61.7 million, representing a growth of 37% compared to the same period of 2020. The variations compared to the previous year mainly reflect the fluctuation in the volume of shipments of Gaming and Enthusiast products, impacted by several factors: A global shortage of chips, especially GPUs, has dampened demand for Asetek’s coolers. Disruptions in global shipping and logistics have delayed customer shipments. Manufacturing schedules and component deliveries from suppliers have been hampered by a global component shortage, power outages and COVID-related plant closures in Tongan District in China.
In order to maximize the future profitability of its data center business, the Company has announced that it is moving out of the high performance computing (HPC) niche. Asetek plans to prioritize the general data center market and support legislation by increasing adoption of its sustainable solutions, capitalizing on its liquid cooling technology and long-term investments in the segment. Asetek recorded a one-time charge of $ 1.7 million operating expenses in Q3 2021 following this strategic change.
Gross margin was 39% for the third quarter and 42% in the first nine months, compared to 47% and 49% in the respective periods of 2020. The decrease in margin reflects higher costs of certain components due to the current global shortage of components, shipping costs, a change in the mix of product shipments and a weaker US dollar.
âWe are poised to generate record revenues in 2021 as gamers invest more in hardware and immersive experiences made possible by Asetek liquid cooling technology. Our long-term revenue ambition of 15% average annual growth through 2025 remains firm despite current closures, component shortages and shipping bottlenecks affecting global supply chains, our growth in the short term and our cost base, âsaid AndrÃ© Sloth Eriksen, CEO and Founder of Asetek. âOur profitable growth strategy is guided by continued innovation within the Gaming and Enthusiast segment, our new SimSports product line and a refocused data center business positioned for significant value creation by providing sustainable solutions for a market general emerging data centers. “
The operating loss was $ 4.1 million and adjusted EBITDA was negative $ 1.4 million in the third quarter of 2021, compared to an operating result of $ 4.3 million and adjusted EBITDA of $ 5.4 million in the third quarter of 2020. Operating profit for the first nine months $ 1.3 million and adjusted EBITDA was $ 6.5 million, compared to an operating result of $ 5.3 million and adjusted EBITDA of $ 8.7 million in the same period of 2020.
Operating expenses included R&D in the new SimSports business line of $ 0.8 million and $ 2.0 million in the third quarter and first nine months of 2021, respectively, compared to zero in the same periods of 2020.
During the third quarter, the Company repurchased 113 thousand ordinary shares for a total of $ 1.25 million carry out share buybacks as part of the April 2021 program. TO September 30, 2021, Asetek had working capital of $ 22.9 million including $ 25.4 million of cash and cash equivalents, and long-term debt totaled $ 1.9 million.
In September, Asetek announced the first of its racing sim products – Invicta Sim Racing Pedals – which includes an accelerator, brake pedal and additional clutch pedal, as well as its RaceHub software for quick tuning and calibration and easy. This initial offering will be available for purchase in the fourth quarter of 2021, with delivery to customers early next year.
In the third quarter, fifteen new Gaming & Enthusiast products began shipping, including one to a new customer. The company also announced new all-in-one (AIO) coolers offered by its partners – Phanteks showcased the extreme performance Glacier One 240T30 AIO CPU cooler and MSI showcased its high-end MEG CORELIQUID S AIO CPU coolers Series.
In October, the company announced that Asetek technology is being incorporated into the first AIO liquid cooling solutions from global gaming leader Razer.
Asetek’s short-term outlook is affected by several factors. Manufacturing schedules and component deliveries from suppliers hampered by power outages and plant closures linked to COVID in Tongan District in China, who can continue. Significant increases in shipping and logistics costs reduce gross margins. A global shortage of chips, especially GPUs, is negatively impacting the Asetek cooler market.
In recognition of the above factors, Asetek on September 22 updated its revenue forecast for 2021 to an increase of 10% to 20% from 2020 (previously 20% to 30%). The operating profit forecasts have been updated between $ 0 and $ 2 million in 2021 (previously $ 8 To $ 12 million), reflecting the effect of declining revenue due to GPU shortage, increased shipping and component costs, uncertainties regarding ongoing operations China, and the non-recurring costs associated with exiting the HPC data center niche. Asetek’s most recent earnings outlook is towards the lower end of the range shown above.
Conference call and webcast today Thursday October 28 at 8:00 CEST:
CEO AndrÃ© Sloth Eriksen and CFO Peter Dam Madsen will present the results of the Company to 8:00 CEST and invites investors, analysts and the media to join in the presentation. The presentation is expected to last up to an hour, including questions and answers, and can be followed via a live webcast or conference call.
Webcast – audio and slide presentation: please join the third 2021 results webcast via the following link:
Conference call – audio only: please dial the number 5-10 minutes before using the phone numbers and confirmation code below:
+45 7872 3250
+47 2396 3938
+49 69222 2391 66
London, United Kingdom
+44 (0) 3333 00 9262
New York, United States of America
+1 631 913 1422 (US PIN only: 80618629 #)
Questions answers :
Conference call lines will be open for participants to ask questions at the end of the presentation. Questions can also be submitted via the online webcast during the presentation.
For any questions or additional information, please contact:
CEO and Founder AndrÃ© S. Eriksen, +45 2125 7076, email: [email protected]
CFO Peter Dam Madsen, +45 2080 7200, e-mail: [email protected]
Asetek, the creator of the all-in-one liquid cooler, is the global leader in liquid cooling solutions for high-performance gaming and hobbyist PCs, and environmentally friendly data centers. Founded in 2000, Asetek is based in Denmark and has operations in China, Taiwan and United States. Asetek is listed on the Oslo Stock Exchange (ASTK.OL).
This information is subject to disclosure requirements in accordance with Section 5-12 of the Norwegian Securities Law.
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