NEUBIBERG (dpa-AFX) - Shares of Infineon Technologies AG (IFNNY) were losing around 4 percent in the morning trading in Germany after the semiconductor solutions company reported Monday weak net profit in its fourth quarter. Income from continuing operations, however, grew with strong revenue growth. The company also increased its full-year dividend.
Looking ahead, for the first quarter, the company expects quarter-on-quarter revenue decrease of 4 percent, plus or minus 2 percentage points, due to seasonal factors. At the mid-point of revenue guidance, the Segment Result Margin is expected to come in at about 17.5 percent.
Further, for fiscal 2019, the company expects year-on-year revenue growth of 11 percent,(plus or minus 2 percentage points, and segment result margin of 18 percent at mid-point of revenue guidance.
For the year, revenue growth in the Automotive segment is expected to exceed the Group average.
Reinhard Ploss, CEO of Infineon, said, 'We begin the 2019 fiscal year with well-filled order books and aim to continue growing faster than the market as a whole. We are keeping a vigilant eye on political and economic developments and will react appropriately if and when the need arises.'
Separately, Infineon said it acquired Siltectra GmbH, a start-up based in Dresden, for 124 million euros. The start-up has developed an innovative technology, Cold Split, to process crystal material efficiently and with minimal loss of material. Infineon will use the Cold Split technology to split silicon carbide wafers, thus doubling the number of chips out of one wafer.
For the fourth quarter, net income declined 20 percent to 141 million euros from 176 million euros last year. Earnings per share fell 19 percent to 0.13 euro from 0.16 euro a year ago.
The latest results were hurt by loss from discontinued operations of 159 million euros. On a continuing operations basis, income was 300 million euros, up 69 percent from 177 million euros last year. Earnings per share from continuing operations grew to 0.27 euro from prior year's 0.16 euro.
Adjusted earnings per share were 0.28 euro, compared to 0.22 euro last year.
Segment Result was 400 million euros, up 22 percent from the prior year. Segment Result Margin improved to 19.5% from 18% last year.
The fourth-quarter revenue increased 12 percent to 2.05 billion euros from 1.82 billion euros last year.
Infineon noted that for the first time, its current business segments have generated over 2 billion euros of revenue in one single quarter. The digitalization and electrification of many aspects in its daily life are resulting in sustained high demand for products and solutions, it said.
Further, the Board plans to increase the dividend for fiscal 2018 by a further 2 cents to 0.27 euros per share, citing the favorable business developments over the past fiscal year and the positive outlook for the 2019 fiscal year. The proposal will be made to shareholders at the Annual General Meeting 2019.
In Germany, Infineon shares were trading at 17.40 euros, down 4.37 percent.
Copyright RTT News/dpa-AFX