Mikron Automation

The Mikron Automation business segment held up well overall in the 2020 financial year despite the COVID-19 crisis. This was due in particular to its good positioning in the main sales market of pharmaceutical and medical technology. In terms of both order intake and order backlog at the end of the year, Mikron Automation succeeded in outperforming the previous year’s figures and compensating for the lack of volume from the automotive industry.

Business Performance

Even in crisis-ridden 2020, Mikron Automation was able to win new customers in its core target market of pharmaceutical and medical technology. These include companies that manufacture COVID-19 test device systems. Thanks to the specific assembly and testing expertise in diagnostic products that it has built up over the past few years, Mikron Automation was able to complete these projects not only efficiently and to the high quality expected by the customer, but also in a very short time. All Mikron Automation’s sites in Switzerland, the US and Asia were well utilized overall throughout the year. Only the Berlin site, which operates exclusively for the automotive industry and has already experienced highly volatile demand in the past, had significantly too few orders. Because the medium-term market outlook here is also comparatively poor, Mikron will close this plant by mid-2021 once the customer projects still in progress have been completed.

Order intake and order backlog

With an order intake of CHF 171.5 million, Mikron Automation succeeded overall in compensating for the lack of orders from the automotive industry in the year under review and slightly exceeded the previous year’s high level (CHF 169.2 million, +1.4%). This was because the business segment was able to further expand its good market position in the pharmaceutical and medical technology sectors. In addition to repeat orders, Mikron Automation also won interesting orders from new customers and for new applications. In the US, Mikron Automation once again posted a significant increase in order intake. Western Europe and the US remain Mikron Automation’s main geographical markets. But in Asia, too, Mikron was able to maintain its position in a fiercely competitive market and win new orders and customers in the second half of the year.

At CHF 123.4 million, the order backlog at the end of the year is also higher than a year ago (CHF 119.4 million, +3.4%) and – with the exception of the Berlin site – well distributed across the individual locations.

Sales and EBIT

At CHF 161.7 million (2019: CHF 177.2 million, -8.7%), Mikron Automation’s sales decline remained modest in a year characterized by travel restrictions, delivery bottlenecks and lockdowns. 35% of Mikron Automation’s sales came from Europe, 49% from North America and 9% from Asia.

The technology build-up that Mikron Automation has successfully completed at its sites in Asia over the past few years has paid off in particular: the project teams in the relevant countries were able to successfully handle even complex projects independently at all times. This includes the rapid delivery of several assembly lines to an international customer in China for the assembly of components for a COVID-19 test kit.

By contrast, the service business in Europe suffered from the COVID-19-related restrictions. Here, Mikron Automation’s sales fell sharply year-on-year, while volumes in North America and Asia continued to increase.

Low capacity utilization at the Berlin site had a severe impact on Mikron Automation’s profitability in the year under review. Costs associated with the restructuring of this company also impacted the segment’s operating results. Before restructuring costs, Mikron Automation posted EBIT of CHF 9.1 million (previous year: CHF 12.9 million) and an EBIT margin of 5.6% (previous year: 7.3%). Taking restructuring costs into account, EBIT still amounted to CHF 1.1 million.

Innovations and strategic projects

In 2020, Mikron Automation continued to develop its platforms and further optimize their scalability to meet the specific needs of the pharmaceutical and medical technology sectors. In June, construction work began on the expansion of the plant in Boudry. The aim of this expansion is to provide the necessary space and optimal conditions for the further development of the successful automation business by the end of 2021 and to create optimal working conditions for both customers and employees. It will also enable production and assembly to take place under controlled climatic conditions – an increasingly common requirement for systems for the pharmaceutical and medical technology industries. It goes without saying that Mikron Automation is also paying close attention to ecological aspects in this building project, massively reducing energy requirements and CO2 emissions thanks to the latest building technology.

Employees

At the end of December 2020, Mikron Automation employed 759 people (full-time equivalents). This is 1.2% more than in the previous year (750). The job cuts at the Berlin site were more than offset by growth elsewhere. Thanks to its attractive job profiles, Mikron Automation again succeeded in recruiting well-qualified new employees in this special year. In the year under review, Mikron Automation employed a total of 49 apprentices. Mikron Automation maintained its internal training program in a reduced form during the pandemic and conducted some of it virtually.

Outlook

In view of the high order backlog and the fundamental growth in demand for pharmaceutical and medical technology products, the Automation business segment is optimistic about the 2021 financial year. However, the yet unpredictable further development of the COVID-19 pandemic and the possible impact on customers’ investment decisions do not allow any concrete forecasts to be made at present, even for Mikron Automation.