Tronics Announces its 2015 Revenue: Transition Year, Promising Contracts Signed at the Beginning of 2016

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As announced in January 2016, 2015 was a transition year, despite significant progress made in diversifying and implementing the technology roadmap. Revenue in 2015 totalled €7.8M, versus €11.6M in 2014.

Tronics' consolidated annual results

In 2016, our goal is to strengthen our company in 3 areas where we have strong positions: standard gyro and accelerometer solutions for high performance inertial applications, custom products for innovative industrial markets, and BioMEMS applications

Tronics, a designer and manufacturer of innovative nano and microsystems, is listed on the Paris Alternext market (ISIN code: FR0004175099 - ALTRO).

The Board of Directors of Tronics, meeting on 23 March 2016, closed the 2015 consolidated statements.

2015, A TRANSITION YEAR DESPITE A GOOD BUSINESS MOMENTUM

As announced in January 2016, 2015 was a transition year, despite significant progress made in diversifying and implementing the technology roadmap. Revenue in 2015 totalled €7.8M, versus €11.6M in 2014.

Tronics experienced good business momentum, winning 11 new customers, further penetrating new markets (Life Sciences) and accelerating internationally (now 44% of total revenue versus 28% in 2014). Nevertheless, these positive developments did not fully offset the lack of revenue from the historical customer (€1.8M in 2014), the significantly lower-than-expected orders in manufacturing from a customer in the optical sector, nor the significant delay faced in a complex engineering project.

The lower top line weighed on 2015 results, the Group having structured itself in the beginning of the year in order to achieve higher revenue. For the full year, therefore, Tronics posted an operating loss of €2.7M and the Group share of net income was a loss of €3.0M.

As of 31 December 2015, the financial structure remained very robust with equity of €15.0M, cash position of €9.1M and gross debt of €4.5M.

MORE NEW CUSTOMERS AND DISTRIBUTORS IN 2016

Since the beginning of 2016, Tronics has signed three major contracts representing significant potential future revenue in manufacturing: 1/ a contract in wearable medical devices with a revenue target of $2.5M per year starting in 2017; 2/ a €700K contract for industrial gas sensors with targeted revenue of €500K to €1M per year ; 3/ a contract for sensors in the field of presence detection with potential manufacturing revenue higher than $600K per year. These projects come in addition to the contracts already signed in 2015 and the ongoing partnerships (Thales, Airbus, STARS project, etc.) that will contribute to the ramp up of the manufacturing activity.

Moreover, the Group strengthened its distribution network by signing an exclusive agreement with Acal BFi, for the distribution of the full range of its GYPRO® standard inertial products throughout Europe. This contract with Acal BFi, the leading distributor of innovative sensors in Europe, complements the existing agreements with Avnet Israel.

Martin Kemp, European Business Development Director - Sensors Business Unit at Acal BFi, commented on this agreement: “We are delighted to announce our pan-European partnership with Tronics Microsystems. The addition of their leading-edge range of GYPRO® standard products complements Acal BFi’s existing sensor portfolio and enhances our ability to provide our customers with the highest performance and most innovative products on the market.”

SEEKING A RETURN TO BREAKEVEN IN 2017

The priority of the Group in 2016 is to complete the engineering projects and to execute the production launch of innovative products in the inertial, Life Sciences and industrial applications sectors with high added value. Tronics intends to leverage these developments to pursue its growth and customer diversification momentum.

The Group believes it will return to dynamic growth in 2016. Revenue should be around €11M and will be weighted towards the second half of the year.

In order to accelerate the return to operating breakeven in 2017, Tronics has launched a cost reduction programme. This action plan, now fully implemented, will represent a saving of €700K in 2016, or about 9% of 2015 fixed costs.

At the same time, the Group will continue to focus on the development of new innovative products. In this context, Tronics recently signed two collaboration agreements with leading industrial players: the STARS project for the development of an accelerometer resistant to extreme altitude conditions, and the TRACE project for the transfer of the M&NEMS technology to the automotive industry.

“In 2016, our goal is to strengthen our company in three areas where we have strong positions: standard gyro and accelerometer solutions for high performance inertial applications, custom products for innovative industrial markets, and BioMEMS applications in Dallas”, said Pascal Langlois, CEO of Tronics.

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Karl Biasio
Tronics
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