news digest ♦ Equipment and Materials
Aixtron to slash 20 percent of jobs in Germany
The firm has agreed on a 5-point plan aimed at returning to sustainable profitability
At today’s Annual General Meeting, Martin Goetzeler, the new CEO of Aixtron SE since March, will set out the measures which the Executive Board intends to implement together with Aixtron’s team to return the company to sustainable profitability.
“We have to focus more closely than ever on our core competence - optimally supporting our customers to reach their targets by offering efficient high-tech equipment for use in complex material deposition. Here, we aim to regain our position of leadership, and that on a sustainably profitable basis. That is what we are working towards,” Goetzeler explains.
He points out that the challenges currently faced by Aixtron resulted from both internal and external factors. “Processes and responsibilities are two particular areas where we have to do our homework,” he says.
Initial measures have already been initiated in recent weeks. These firstly include a project to enhance efficiency in the company’s product development. Secondly, the Executive Board has decided to cut more than 20 percent of jobs in Germany - an “inevitable, albeit very painful” decision. Further measures introduced in the 5-Point Program intend to contribute decisively towards a sustainable profitability.
Although the weakness is still apparent on the demand side, the Executive Board has stressed that the positive medium and long-term outlook is still intact for the MOCVD, silicon, and organic deposition technologies provided by Aixtron.
Key aspects of the 5-Point Aixtron Program are presented below.
1. Customer - focusing on customer benefit
To optimally address customer needs, such as product quality and productivity, Aixtron will compile roadmaps together with its customers that are then factored into the relevant development programs. The business model is being reviewed to boost the service business.
2. Technology and products - putting unique product portfolio to more effective use, further strengthening future products
To be sustainably profitable, the firm is building on its technology in complex material deposition and aims
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to regain market leadership in the area of MOCVD technology in LED production.
3. Efficiency – systematically optimising process and project structures
A cross-functional project will optimise the timing and use of resources in product development and thus make it possible to achieve outstanding development results at lower expense. The company will also step up its partnership-based cooperation with suppliers.
4. Finance - value oriented financial targets
Aixtron’s Executive Board sees management by clear financial targets as the basis for achieving sustainable profitability. Here, it will focus on four superordinate key financial figures which are Revenues, EBIT, Free cash flow and return on capital employed > cost of capital over business cycle (ROCE > WACC).
The current priority has been to rapidly adjust costs to present circumstances. For the current year, the Executive Board already decided in March to cut operating expenses - excluding restructuring and transformation expenses - by 20 percent compared with the previous year, and thus to reduce the breakeven point.
5. Employees – strengthening Aixtron culture, taking individual responsibility, fortifying communication
Following some tough quarters, Aixtron aims to reinforce one of its key qualities - its employees’ sense of identification with the firm. What’s more, the Executive Board wants to further develop management culture and to adapt it to new challenges. To accomplish this, the firm is agreeing clear goals and closely monitoring their achievement.
In its future financial reporting, the Executive Board will regularly report both internally and externally on the status of this company program.
The CEO Martin Goetzeler will provide further details about the 5-Point Program in his presentation at today’s Annual General Meeting in Aachen. The prepared notes of the speech will be available for download following the presentation at
www.aixtron.com/
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