Gigaset AG publishes 2021 Annual Report: Higher revenues and sharp increase in EBITDA26. April 2022 Published by Raphael Doerr
Gigaset AG (ISIN: DE0005156004), an internationally operating company in the area of communications technology, today published its Annual Report for 2021. The past fiscal year was again challenging as a consequence of the ongoing coronavirus pandemic. The emergence of the Omicron variant of the virus in the fall, as well as huge difficulties with the supply of materials and intermediate products worldwide, necessitated adjustment to the forecast for revenues and EBITDA in the second half of November. However, the new forecast was finally achieved in full or surpassed. Gigaset AG increased its revenues and operating income (EBITDA).
In total, Gigaset generated consolidated revenues of EUR 217.1 million in fiscal 2021 compared with EUR 214.2 million in the previous year (+1.4%). Strict cost controlling, efficient working capital management and improved gross income meant that the EBITDA of EUR 16.5 million was well up on 2020 (EUR 1.9 million). Whereas demand in the Phones segment rose above-average in 2020 and is now gradually starting to normalize, the Smartphones and Professional segments performed particularly positively.
“We faced growing challenges in the past year. We were well on the way to making 2021 a very good year,” says Thomas Schuchardt, Gigaset’s CFO. “Our order books were and are bulging, and the impact of the coronavirus pandemic on topics such as New Work, working from home and digitization increased demand perceptibly. However, increasing difficulties in the supply of semiconductors and a sharp rise in material costs from the third quarter onward thwarted that. I’m all the more delighted that we were able to increase revenues and in particular EBITDA all in all.”
“Even though our results are impressive overall, the huge semiconductor supply bottlenecks dashed our hopes of what would have really been a very positive year,” adds Klaus Weßing, Chief Executive Officer of Gigaset AG. “We were ultimately not able to make up for the production backlogs caused by the semiconductor crisis. We’ve been working since 2020 to make our supply chains more resilient so as to ensure we are supplied with chips as best possible in the future, but we face big challenges.”
Performance by segments
In the mainly consumer-oriented Phones, Smartphones and Smart Home segments, revenues in 2021 totaled EUR 159.9 million, 7.6% down compared with the previous year (2020: EUR 173.1 million). In Professional business for B2B customers, however, the company generated a sharp 39.2% increase in revenues to EUR 57.2 million (EUR 41.1 million).
The Phones segment generated revenues of EUR 140.2 million in fiscal 2021 (2020: EUR 157.3 million), a decline of 10.9%. The market for fixed-network telephony continued to decline as a whole and was additionally impacted last year by difficulties in procuring materials. Whereas strict lockdowns and tough measures to combat coronavirus in 2020 meant that more people worked from home, resulting in increased use of the fixed-line network, telephony habits largely normalized in 2021. That was mainly due to a slight easing of the measures and fall in the infection rates in the summer.
The Smartphones segment posted revenues of EUR 18.2 million (2020: EUR 13.3 million), an increase of 36.8%. That success was underpinned by the GS3 and GS4 smartphones that were launched at the end of 2020, and by the GS5, which was put on the market at the end of last year. The ruggedized GX290 Plus and GX290 Pro smartphones, which have been developed specifically for outdoor and industrial uses, contributed to this success. An especially pleasing aspect was that Gigaset was able to win various public invitations to tender in the industrial arena, such as from Deutsche Bahn. That was due to the impressive quality of our products, as well as Gigaset’s unique selling point that they are “Made in Germany.”
Revenues of EUR 1.5 million were generated with smart home products in fiscal 2021 (2020: EUR 2.5 million). Gigaset attributes the decline in particular to smart home solutions still being regarded as an “option.” In times of crisis and rising inflation, customers therefore refrain temporarily from buying such products in favor of other goods.
The Professional segment contributed EUR 57.2 million to consolidated revenues in fiscal 2021 (2020: EUR 41.1 million) – a hefty increase of 39.2%. That was mainly due to the implementation of numerous projects that had been suspended in the previous year and postponed until 2021 due to the coronavirus pandemic. The product developments relating to the exclusive agreement with Unify that Gigaset won in 2020 were continued successfully in 2021, although they do not yet generate revenue. Under this agreement, Unify will exclusively purchase a family of desktop phones developed by Gigaset. The first products are expected to be shipped in 2022.
Even the year 2022 does not allow for detailed projections of a general economic recovery. The uncertainty surrounding the Corona pandemic, which has not yet been overcome, was compounded by the Ukraine conflict at the end of February: The effects of the first war in Europe since the end of the Second World War and the resulting sanctions, especially in economic terms, cannot be reliably estimated at present. The external factors on which Gigaset’s business is also dependent include higher energy and material prices, logistics problems and a sharp rise in inflation, as well as bottlenecks in the semiconductor sector, which will continue in the medium term.
General statement by the Executive Board for 2022
Excluding a sudden significant worsening of the pandemic of supply chain situation, Gigaset expects its financial position, cashflows and financial performance to develop as follows in the 2022 financial year:
- A slight increase in revenues and EBITDA
- A moderately positive free cashflow
The Annual Report for 2021 can be downloaded here.