Another strong quarter for GPV – raises its outlook
Danish EMS provider GPV continues to report growth. The company is reporting a second-quarter revenue increase of 49% compared to the same period last year.
The electronics manufacturer says that increasing demand and high utilisation rates at its twelve factories are the main reasons behind the growth. Based on this current performance – the company's best performance ever for a first half-year – GPV is also raising its full-year guidance.
GPV is reporting 2Q22 revenue fo of DKK 1.134 billion (EUR 152.4 million), making this the second straight quarter with revenue exceeding DKK 1 billion (EUR 134.4 million). The Q2 revenue was up by 49% year on year, bringing total revenue for the first half of 2022 to DKK 2.143 billion (EUR 288.1 million), an increase of 43% compared with the first half of 2021.
“We are very pleased with our significant organic growth over the past years which is driven by two elements – most importantly, higher demands from our customers and in addition, higher material costs. A part of our increasing sales comes from new customers who choose us because of our service excellence and our integrated sustainability profile.” says GPV’s CEO Bo Lybæk in a press release.
In terms of earnings, 2022 has also developed better than expected. In Q2 2022, GPV realised earnings (EBITDA) of DKK 97 million (EUR 13.0 million), compared to DKK 77 million (EUR 10.3 million) the previous year. Total earnings for the first half of the year landed at DKK 188 million (EUR 25.2 million), compared DKK 152 million (EUR 20.4 million) in the first half of 2021, corresponding to a 24% increase.
“We are still in a situation with challenging material supply and short-term decommits unfortunately defining the developments in our industry. We expect this situation to continue for at least the rest of 2022, making visibility generally low. This is one of the reasons why, during the last twelve months in close co-operation with our customers, we have doubled our commitment to working capital with around one billion Danish kroner. While this would normally be considered a negative development, however, it is an investment we have made, simply to better secure deliveries to our customers. At the same time, we have managed to make maximum use of our existing capacity and to continuously add new capacity,” says Bo Lybæk further.
GPV continues to work on several major capacity expansions. This includes a new mechanics factory in Thailand followed by an expansion of our existing electronics factory in Thailand and an extension of the existing electronics factory in Sri Lanka, as well as a range of capacity expansions in Europe, Asia, and Mexico.
GPV has an ambition of reaching a revenue of DKK 7.5 billion (EUR 1.0 billion) latest by 2025 and with the upcoming merger between GPV and Enics, that revenue target will be achieved earlier. Enics has seven factories in Europe and Asia and employs around 3,500 people. The company had revenue of DKK 4 billion (EUR 537.7 million) and EBITDA of DKK 220 million (EUR 29.5 million) in 2021.
The combined company will have production facilities in 13 countries spread across three continents. The merger is currently awaiting customary approvals, including from competition authorities.
GPV is raising its full-year guidance for the second time this year and before any effect from the merger with Enics. Revenue is expected to land in the DKK 3.9 – 4.1 billion (EUR 524 – 551 million) range compared to the original guidance of DKK 3.5 – 3.7 billion (EUR 470 – 497 million).