GPV lifts revenue by 49 per cent and raises full-year guidance

Danish-based European top-10 electronics manufacturer GPV continues to ride a wave of growth. The company lifted revenue by 49 per cent in the second quarter compared to last year to a record high of DKK 1.134 billion. Increasing demand and high utilisation rates at GPV’s 12 factories are the main reasons for the substantial growth. Based on the performance, GPV raises its full-year guidance.

The electronics manufacturer GPV, owned by Nasdaq Copenhagen-listed Danish industrial conglomerate Schouw & Co., today released a record financial report for Q2 2022, announcing its best performance ever for a first half-year. The financial statements show reported revenue for Q2 2022 of DKK 1.134 billion, making this the second straight quarter with revenue exceeding DKK 1 billion. The Q2 revenue was up by 49 per cent year on year, bringing total revenue for H1 2022 to DKK 2.143 billion or a 43 per cent increase:

“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. Here, we have pushed forward and will continue to push in the years to come due to our ambitious goal of a 50 per cent reduction1 of our carbon emissions from our 2020 baseline towards 2025,” explains GPV’s CEO Bo Lybæk.

In terms of earnings, 2022 has also developed better than expected. In Q2 2022, GPV realised earnings (EBITDA) of DKK 97 million compared to DKK 77 million the previous year. Total earnings for the first half of the year thus landed at DKK 188 million against DKK 152 million in the first half of 2021, corresponding to a 24 per cent 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. It has been the best recipe for navigating safely through the supply chain crisis,” 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.

Based on a new strategy entitled Winning Our Future 2025+ (WOF25+), GPV has an ambition of reaching a revenue of DKK 7.5 billion latest by 2025. The company’s vision has been updated as part of the new strategy with a clear aim: We are the most trusted, powerful, and top-of-mind EMS partner to our customers. Furthermore, sustainability has become an integrated part of the WOF25+ strategy.

With the upcoming merger between GPV and Enics, the revenue target of DKK 7.5 billion 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 and EBITDA of DKK 220 million in 2021. The merger will take place under a new holding company with Schouw & Co. owning 80 per cent, while the remaining 20 per cent is held by Ahlström Capital B.V., the current owner of Enics. The new company will be headquartered at GPV’s current premises in Vejle with Bo Lybæk leading the integration of the two companies:

“We are very excited about the upcoming merger with Enics. The planning of the integration of the two companies has begun and is progressing very well. We both have our strengths within the industrial segment, and we complement each other in terms of production technology, know-how and geographical presence. I have the utmost respect for Enics, and I approach the planning process with careful regard for best practices so that we can find the best solutions together. I am looking forward to closing so we can meet everyone in the new combined company,” says Bo Lybæk.

The combined company will have production facilities in 13 countries spread across three continents and will be a number 2 EMS company headquartered in Europe. 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 range compared to the original guidance of DKK 3.5-3.7 billion. The earnings guidance is raised to the range of DKK 330-360 million from previously DKK 310-350 million.