Topic: After a challenging FY23, order intake in the first quarter of FY24e came in at c. € 28m as stated in the CC (vs. only € 43m in total FY23), due to strong demand in the semiconductor segment. Hence, FY24e looks more promising with operating breakeven in reach (eNuW).  

Solar: In FY23, a first sputtering machine for thin-film solar cells following the CdTe process was delivered to Singulus’ most important customer, CNBM (usually 30%-50% of Solar revenue). Thanks to the good performance of the machine, CNBM already placed a follow-up order at the end of last year.  In addition, another machine type operating under the CSS technology was ordered last year and will be delivered within the next two months. Next to CNBM, the Italian energy company Enel, is also an important customer in the Solar segment. Last year, Singulus already delivered five machines for their factory in Sicilia. More orders from Enel are expected for the second quarter as they start their new project in the US. However, due to long lead times of roughly 12 months we expect to see most of the revenue not until FY25e. With a solid order pipeline and several orders in reach, Solar should again be the most important segment in FY24e (eNuW: € 50m; + 28% yoy).

Life Science: Starting from a high level in FY22, revenues in Life Science came in rather soft in FY23 due to the cyclical nature of the business. The situation should remain challenging during FY24e, as the macro environment remains clouded and a low order backlog of € 5.2m (as stated in the CC) limits visibility. Hence, we expect to see only a slight increase in revenue of 5.9% yoy to € 25.3m in FY24e.

The Semiconductor segment is Singulus smallest segment, however it is also growing at a fast pace (FY23 sales: + 66%) and delivers a higher gross margin than the other operating segments. We expect this dynamic development to continue in FY24e (eNuW: € 21.8m; +112% yoy), due to the strong order intake of € 11.3m (€ 9.3m in total FY23) in Q1 FY24e and continuously significant investments from China in the semiconductor industry.

Operating breakeven in reach: Based on our estimates, Singulus has to reach c. € 100m in revenue for FY24e (eNuW FY24e: € 97m) to breakeven on EBIT level. After five years of negative EBIT (adjusted for the extraordinary income of € 12.1m in FY22 from a property sale), it looks like Singulus could reach the breakeven point this year. We reiterate HOLD with an unchanged PT of € 1.60 based on DCF.