HALF YEAR REPORT 2019 · 2019. 8. 23. · • Full year revenue, EBITDA, and EBIT guidance have...

HALF YEAR REPORT 2019

Foundation 1997

Business Fabless semiconductor provider of embedded wireless and positioning communication solutions

Headquarter Thalwil, Switzerland

Offices Australia,Belgium,China,Finland,Germany,Greece,India,Ireland,Italy,Japan, Korea, Pakistan, Singapore, Sweden, Taiwan, United Kingdom and USA

Listed SIXSwissExchange(UBXN)

Employees 1’021(June30,2019,FTEbased);1’020(December31,2018,FTEbased)

Revenue H1.2019:CHF190.6million;H1.2018:CHF199.0million

EBIT(adjusted) H1.2019:CHF19.7million;H1.2018:CHF34.9million

Netprofit (adjusted) H1.2019:CHF13.6million;H1.2018:CHF30.2million

Markets Industrial,AutomotiveandConsumer

Mission u-bloxaimstobetheleadingproviderofembeddedwirelesscommunicationandpositioning solutionstotheglobalelectronicsindustry

3 Financial highlights

4 HalfyearreportasofJune30,2019

8 Condensedconsolidatedinterimfinancialstatementsu-bloxHoldingAG,Thalwil

19 Consolidatedstatementoffinancialposition

10 Consolidatedincomestatement

11 Consolidatedstatementofcomprehensiveincome

12 Consolidatedstatementofchangesinequity

13 Condensedconsolidatedstatementofcashflows

14 Notestothecondensedconsolidatedinterimfinancialstatements

21 InformationforInvestors

22 Worldwide presence

Page2|Halfyearreport2019

Contents

This is u-blox

Financial highlights |

190.6

60.5%

19.7

13.6

45.2%

RevenueinmCHF

Equityratio in %

Operatingprofit(adjusted)inmCHF

Netprofit(adjusted)inmCHF

Grossprofit(adjusted)in%

RevenueH1.2018:199.0–Growthrate:-4%

33.1OperatingcashflowinmCHF

OperatingcashflowH1.2018:13.7–Growthrate:141%

Equityratio2018:63.1%

OperatingprofitH1.2018(adjusted):34.9–Growthrate:-44%

NetprofitH1.2018(adjusted):30.1–Growthrate:-55%

GrossprofitH1.2018(adjusted):47.2%

Financial highlights

TotalequityandequityratioinmCHF

Americas EMEAAPAC EBITDA(adjusted)

Revenuebygeography / EBITDA(adjusted)inmCHF

u-bloxrevenuesplitpermarket Employeebreakdown spreadover18countries75%ofemployeesbasedoutsideSwitzerland

Total:1’021

Logistics, admin15%(2018:157)

Sales, marketing, support 17%(2018:171)

Research &development68%(2018:692)

(H1.2019,FTEbased)

(%oftotalassets)

Equity

2016 2017 2018 H1.17

Equityratio

H1.18 H1.19

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%2016

400

350

300

250

200

150

100

50

0

2017 2018 H1.17 H1.18 H1.19

Industrial Consumer Automotive Notassigned

400

350

300

250

200

150

100

50

0

90.0 97.8 81.2

45.8 45.1 32.7

39%

26%

35%

40%

27%

33%

38%

32%

30%

42%

27%

31%

33%

36%

31%

193.9 199.0

360.2

393.3 403.7

190.6

35%

33%

32%

285 319 349

67.0%

60.7%63.1%

58.1% 62.0% 60.5%

275 346 348

57.5%

7.7%

30.0%

4.8%

2019half-yearhighlights

Thalwil,Switzerland–August23,2019–u-blox(SIX:UBXN),aglobalproviderofleadingpositioningandwirelesscommunicationtechnologies,todayannouncedresultsforthefirsthalfyear.

• RevenuesofCHF190.6millioncomparedtoH1.2018revenuesofCHF199.0million,adeclineof4.2%

• APACreturnedtogrowthandincreasedrevenueby8%comparedtoH1.2018;Chinasawgrowthof14%

• Grossprofit(adjusted)wasCHF86.1millioncomparedtoCHF94.0millioninH1.2018,adeclineof8.4%andgrossmargin(adjusted)decreasedto45.2%com-paredto47.2%inH1.2018(45.2%forFY2018)

• EBIT(adjusted)felltoCHF19.7millioncomparedtoCHF34.9millioninH1.2018

• EBITDA(adjusted)declinedtoCHF32.7millioncom-paredtoCHF45.1millioninH1.2018

• OperatingactivitiesgeneratedacashflowincreasetoCHF33.1millioncomparedtoCHF13.7millioninH1.2018

• Positivefreecashflow(beforeacquisitions)ofCHF3.9million

• Netprofits(adjusted)wereCHF13.6millioncomparedtoCHF30.2millioninH1.2018

• Strong growth in number of customers compared to H1.2018

• Importantproductlaunches–newchipplatformandmodules

• R&Dpipelineexpanded–significantproductlaunchesahead

• Fullyearrevenue,EBITDA,andEBITguidancehavebeenadjustedreflectingmacro-economicuncertainties

Remark:Allnumbersinthisreportareadjusted.IFRSnum-bersareprovidedinthefirsttableofthispressrelease.

Inthefirsthalfof2019,u-bloxreachedrevenuesofCHF190.6millioncomparedtoH1.2018revenuesofCHF199million,adeclineof4.2%.ThecompanysawaresurgenceintheAPACregionwithgrowthof8%andgrowthof14%inChinaagainstH1.2018.

Theeffectofthisresurgencewasattenuatedbyareduc-tioninrevenuesinEMEAof12%againstH1.2018,whichhadbeenaparticularlystronghalfyear,andintheAmeri-casbyadeclineof7%comparedtoH1.2018duetoaslowerthanexpectedmigrationandrampuptoLTE-basedcon-nectivity.

u-bloxpostedgrossprofits(adjusted)ofCHF86.1millioncomparedtoCHF94.0millioninH1.2018,andgrossmargin(adjusted)decreasedby2%to45.2%comparedto47.2%inH1.2018(45.2%inFY2018).

EBIT(adjusted)felltoCHF19.7millioncomparedtoCHF34.9millioninH1.2018,affectedbylowerrevenuesandanincreaseinR&Dexpenses,which,inadditiontonewprod-uctsthathavealreadybeenannounced,willdelivermoreimportantadditionstotheportfoliothisyear.

RegionaldevelopmentInAsia,therehasbeenstrongprogressintheautomotiveandindustrialsegments,withparticulargrowthinJapanforautomotivesolutionsanda14%growthinChinadrivenbyincreaseddomesticinvestmentintechnologyforinfra-structureaswellasgrowthinindustrialIoT,withChinaac-countingforaboutonequarteroftheIoTmarketglobally.InTaiwan,however,wesawourgrowthdeclineduetotheelimination of one large customer for lack of compliance withourtermsandconditions.

IntheAmericas,whiletherewasaslightdeclineinsales,somecustomersegmentshadtofurtherdelaymigra-tiontoLTE-basedconnectivity.MovingintoH2,withthishesitation disappearing, customers are ramping up their productionwithCatM-basedmodems.

IntheEMEAregionindividualprojectscontributedtoanexceptionallygoodresultinH1.2018whichcouldnotberepeatedinthisyear.Inthefirsthalfof2019,growthwasachievedaboveallinsustainabilityprojectssuchasEVchargingorsolarconverters.Againstsecondhalfyear2018revenuesgrewby10%.

ResearchandproductdevelopmentInthefirsthalfof2019,R&Dexpenses(adjusted)stoodatCHF39.8millioncomparedtoCHF33.1millionduringthesameperiodin2018,anincreaseof20.3%whichincludesincreasedamortizationforcapitalizedprojectsofCHF5.6millionfromCHF4.4millioninH1.2018andalowercapi-talizationrateof43.3%(H1.2018:48.9%).R&Dexpenses(adjusted)represent20.9%ofrevenuecomparedto16.6%inthesameperiodlastyear.

DistributionandmarketingactivitiesDistributionandmarketingexpenses(adjusted)remainedstableatCHF17.8million(CHF17.7millioninthesameperiodlastyear). FinanceincomeandcostsFinanceincomewasCHF1.8millioncomparedtoCHF5.4millioninH1.2018,adeclineof67%mainlyduetolessfavorablecurrencydevelopment.FinancialcostswereCHF3.2millionagainstCHF1.0millioninH1.2018.Theyconsistmainlyoftheinterestforthetwobonds,interestforleaseliabilities,andforeignexchangelosses.Thefinancialresultalsocontainsthelossfromat-equityaccountedinvestees(SapcordaGmbH)netoftaxofCHF2.0millionagainstCHF1.4millioninH1.2018. PositivefreecashflowCashflowfromoperatingstronglyincreasedtoCHF33.1million(H1.2018:CHF13.7million)andfreecashflow(be-foreacquisitions)achievedCHF3.9million.InvestmentswerelowerinthisperiodthaninH1.2018andworkingcapi-taldecreased.Dividendpaymentandinterestpaymentsrequired cash resulting in a decreased cash position of CHF121.0million(31.12.2018:CHF136.3million).

Stableandstrongfinancialpositionu-bloxmaintainedastrongbalancesheetduringthefirsthalfof2019;theequityratioamountedto60.5%.Cash,cashequivalents,andmarketablesecuritiestotaledCHF122.4millionasofJune30,2019,comparedwithCHF137.7millionatendof2018.

u-bloxreportsfirsthalf2019financialresults

| Letter to the shareholders

ChangesinaccountingstandardIFRS-16WiththeintroductionofIFRS-16theaccountingtreat-mentoflongtermrentalcontractschanged.TheimpactofthechangeinH1.2019ontoEBITDAwasCHF2.6millionandonEBITCHF0.4million.Thereisnoimpactonnetprofit.InthebalancesheetendofJune2019thereisanewright-of-useassetsintheamountofCHF19.5millionandaccordinglythereareadditionalfinancialleaseliabilitiesofCHF19.5million.Inthecashflowstatementtheintroduc-tionofIFRS-16resultsinaCHF2.6millionincreaseofcashgenerated from operating activities and additional cash usedinfinancingactivitiesinthesameamount.

StrategichighlightsandinitiativesDesignedtodeliversustainable,profitablegrowthacrossmarketcycles,u-blox’sstrategyisfoundedonfourdiscretepillars:ongoingstrengtheningofourleadingmarketposi-tion;continuingtechnologicaldevelopmentandinnovation;outstandingoperationalperformance;andstrategicpart-nerships.Despiteachallengingenvironmentinsomeofourcoremarketsduringthefirsthalfof2019,u-bloxmadead-vancesinthesekeystrategicareas:u-bloxannouncedtheSARAR5seriesofLTEMandNBIoTmodulesforlowpowerwidearea(LPWA)applications,itsmostadvanced,secure,andhighlyintegratedcellularproduct.Themodule,builtontheu-bloxUBXR5cellularchipsetandtheu-bloxM8GNSSreceiverchip,offersunmatchedendtoendsecurityandlongproductavailability,makingitidealforIoTapplicationswithlongtermdevicedeployments.

Earlierintheyear,u-bloxannouncedtheu-bloxZEDF9KhighprecisionmultibandGNSS(GlobalNavigationSatel-liteSystem)modulewithbuiltininertialsensors.

ThemodulecombinesthelatestgenerationofGNSSreceivertechnology,signalprocessingalgorithms,andcorrection services to deliver down to decimeter level ac-curacywithinseconds,addressingtheevolvingneedsofADAS(AdvancedDriverAssistanceSystems)andauto-mateddrivingmarkets.Siemenshasintegratedtheu-bloxZEDF9KhighprecisiondeadreckoningmoduleintoitsToyotaPriusV2X(vehicletoeverything)testfleet.

OnJuly31,2019,u-bloxannouncedthatitacquiredthewirelessmodulesbusinessfromRigado’sportfolioinanassetpurchaseagreement.Foundedin2010,Rigadoisacustomelectronicsdesigncompanyinlowpower,wirelessproductswithafocusontheInternetofThings(IoT)andconsumerwearables.Thisagreementallowedu-bloxtoextendtherangeofitsproductsintheareaofBluetooth®lowenergy,Zigbee,andThread,aswellastoaccessnewmarketsegmentsandchannels.TheacquisitionwasclosedonJuly31,2019.

NewcustomerengagementsInthefirsthalfof2019,wesawastronggrowthinourcustomernumbers,growingfrom5’900to6’700servedaccounts.

TreonofferedadisruptiveTreonNodeandGatewayplat-formforsmartbuildingapplicationsearlierthisyear.Theirplatformusestheu-bloxNINABluetoothmoduleseriestoconnect nodes distributed across a building in a wireless meshnetwork.AnIoTedgegatewayfeaturingau-bloxSARA-R4cellularmoduleandau-bloxNINA-B1Bluetoothlowenergymodulelinksthenetworktothecloud.

(inCHF000s)

Jan. - June 2019

(IFRS) % revenueAdjust-ments2)

Jan. - June 2019

(adjusted) % revenue

Jan. - Dec. 2018

(adjusted) % revenue

Revenue 190’554 100.0% 190’554 100.0% 198’983 100.0%

Costofsales -104’772 -55.0% 306 -104’466 -54.8% -105’013 -52.8%

Grossprofit 85’782 45.0% 306 86’088 45.2% 93’970 47.2%

Distributionandmarketingexpenses -18’556 -9.7% 798 -17’758 -9.3% -17’671 -8.9%

Researchanddevelopmentexpenses -42’368 -22.2% 2’591 -39’777 -20.9% -33’072 -16.6%

Generalandadministrativeexpenses -11’320 -5.9% 1’065 -10’255 -5.4% -9’387 -4.7%

Other income 1’368 0.7% 1’368 0.7% 1’063 0.5%

Operatingprofit(EBIT) 14’906 7.8% 4’760 19’666 10.3% 34’903 17.5%

Financial income 1’762 0.9% 1’762 0.9% 5’364 2.7%

Finance costs -3’157 -1.7% -3’157 -1.7% -1’042 -0.5%

Shareofprofitofequity-accountedinvestees,netoftaxes -1’989 -1.0% -1’989 -1.0% -1’443 -0.7%

Profitbeforeincometax(EBT) 11’522 6.0% 4’760 16’282 8.5% 37’782 19.0%

Incometaxexpense -1’872 -1.0% -773 -2’645 -1.4% -7’622 -3.8%

Netprofit,attributabletoownersoftheparent 9’650 5.1% 3’987 13’637 7.2% 30’160 15.2%

EarningspershareinCHF 1.39 1.96 4.32

DilutedearningspershareinCHF 1.39 1.96 4.31

Operatingprofit(EBIT) 14’906 7.8% 4’760 19’666 10.3% 34’903 17.5%

Depreciationandamortization 14’164 7.4% -1’092 13’072 6.9% 10’229 5.1%

EBITDA1) 29’070 15.3% 3’668 32’738 17.2% 45’132 22.7%

1) ManagementcalculatesEBITDA(earningsbeforeinterest,taxes,depreciationandamortization)byaddingbackdepreciationand amortizationtooperatingprofit(EBIT),ineachcasedeterminedinaccordancewithIFRS.2) Adjustmentsareimpactsofsharebasedpayments,PensioncalculationaccordingtoIAS-19,Non-recurringexpensesandamortization ofintangibleassetsacquired.

Table1:Consolidatedincomestatement(adjusted)

Letter to the shareholders | Page5

u-blox,inpartnershipwithArventoMobileSystems,aglobalpioneerinvehicletelematicsandfleetmanagementtechnology,announcedthelaunchofthenewimt.x1 vehicletrackingsystem.Theimt.x1setsitselfapartfromother vehicle tracking devices on the market thanks to its 6axisgyrosensorthatcansense3dimensionalmove-mentcausedbyemergencyacceleration,panicbraking,anddirectionalyawanddrift.WithconnectivityoptionsincludingdualCANBusandBluetooth,thesystemisalsoeCallcompatibleandcapturesandprovidesdataforaccidentanalysisandothervehicletrackingfunctions.Thesystemalsousesapowerful,next-generationARM®-basedmicrocontroller.

BoardandmanagementToallowCEOThomasSeilertofocusmoreoncorporatestrategy,thecompany’sinnovationagenda,andacquisitionstrategy,u-bloxnamedMarkusSchaeferasnewExecu-tiveDirectorforGlobalMarketingandSales.Schaefer,aveteranofthesemiconductorindustrywithasolidtrackrecord in growing market share in his previous positions, willcompleteublox’sexecutiveleadershipteam.MarkusSchaeferwilldefineandimplementthecompany’ssalesandmarketingstrategyintheAmericas,EMEA,andAPACsalesregions.

OutlookThomasSeiler,CEOofu-blox,commented:“Whilethefirsthalfof2019hasoveralldevelopedbelowourinitialexpec-tations,wearegreatlyencouragedbythereturntogrowthinAPACandthestrongexpansioninChinawherenearlyonequarterofourrevenuesaregenerated.Thesecondhalfof2019willcontinuetoremainimpactedbymacro-economicuncertainties,reflectingwiderglobaltrendsintheindustry,impactedbyanumberoffactorssuchastheU.S.-Chinatradedisputeandpoliticalquarrelsresultinginslowergrowthinthemajorapplications.”

Weexpecttheremainingmonthsof2019toremainchal-lengingbutweareconfidentthatwearemakingtherightinvestmentsforthefuture.WecontinuetobelievetheInternetofThingswillchangeeveryaspectofoursociet-ies,ourbusinesses,andoureverydaylives.Investmentsinto chips, modules and services for industrial wireless technologyarelongterm:andwhiledevelopmenttakestimeandmoney,harvestingispossibleforadecade.Fromaninnovationpointofview,duringH2,weexpecttolaunchmoreinnovativeproductsandsolutions.Importantnewplatformsareclosetomarketlaunch.

(inCHF000s)

Fortheperiodended

June30,2019

Fortheperiodended

June30,2018

Netprofit 9‘650 25’083

Depreciation&Amortization 14’164 11’510

Other non-cash transactions 2’547 6’093

Financialincome&Financialexpense 3’384 -2’879

Incometaxexpense 1’872 6’339

ChangeinNetworkingCapitalandprovision 7’900 -21’457

Incometaxpaid -6’406 -10’953

Netcashgeneratedfromoperatingactivities 33’111 13’736

Netinvestmentintoproperty,plantandequipment -3’409 -4’345

Netinvestmentintointangibles -26’408 -27’623

Netinvestmentintofinancialassets 612 918

Participation in capital increase -3’386 -4’108

Netcashusedininvestingactivities -32‘591 -35‘158

FreeCashFlow(beforeParticipationincapitalincrease) 3‘906 -17‘314

FreeCashFlow 520 -21‘422

Proceedsfromissuanceofordinaryshares 91 13’599

Dividendspaidtoownersoftheparent -11’077 -15’440

Repaymentoffinancialliabilities -2’192 0

Purchaseoftreasuryshares 0 0

Interestpaid -2’182 -1’813

Netcashprovidedby/usedinfinancialactivities -15‘360 -3‘354

Netdecreaseincashandcashequivalents -14‘840 -25‘076

Cashandcashequivalentsatbeginningofyear 136’296 169’624

Exchangegains/(losses)oncashandcashequivalents -481 3’291

Cashandcashequivalentsattheendoftheperiod 120‘975 147‘839

Page6 | Letter to the shareholders

Table2:Consolidatedstatementofcashflows(condensed)

Table3:Consolidatedstatementoffinancialposition(condensed)

(inCHF000s)AtJune30,2019

(unaudited)AtDecember31,2018

(audited)

ASSETSCurrentassets

Cashandcashequivalents 120’975 136’296

Marketable securities 1’404 1’401

Trade accounts receiveables 52’607 60’802

Other assets 83’097 78’415

Totalcurrentassets 258’083 276’914

Non-currentassets

Property,plantandequipment 13’707 14’829

Right-of-use assets 19’460 0

Goodwill 54’068 55’231

Intangibleassets 212’113 193’445

Financialassets(incl.equityaccountedinvestees) 11’094 9’041

Deferredtaxassets 6’987 3’570

Totalnon-currentassets 317’429 276’116

Total assets 575’512 553’030

LIABILITIESANDEQUITY

Currentliabilities 53’696 55’476

Non-currentliabilities 173’450 148’677

Total liabilities 227’146 204’153

Shareholders’equity

Share capital 6’391 6’390

Share premium 55’309 66’296

Retained earnings 286’666 276’191

Totalequity,attributabletoownersoftheparent 348’366 348’877

Totalliabilitiesandequity 575’512 553’030

Letter to the shareholders | Page7

André Müller Thomas Seiler ChairmanoftheBoardofDirectors CEO

IntheAmericas,weareseeingsignsofgrowthintheindustrialsector,andfollowingouracquisitionofRigado’swireless modules, we are well-placed to leverage the con-sumer sector with now a strong footprint in the consumer healthandsportssectors.We’realsoseeingaspeedingupofcustomersmigratingtoLTECatMtechnologiesandtheemergenceofnewproductsatourcustomers.

InEMEA,thesecondhalfyearwillonlyslightlygrow.De-spitestrongprogressinindustrialIoTtheoverallnegativesentimentintheindustryandthedeclineinautomotiveproductionmakegrowthhardtoachieve.

InAPAC,wewillseeinH2continuedgrowthmainlydrivenfromChinaandJapanwherenewprojectscontinuetorampup.InChinadomesticdemandremainssolidmainlyin the industrial domain whereas automotive lacks basic

volumegrowthandonlythetrendtomoreelectronicsinthecarprovidesforexpansion.”

u-bloxisadoptingacautiousbutpositiveoutlookforthisperiodandremainsconfidentthatthefundamentalsofourcompanyareinplaceforhealthyfuturegrowthandbottom-line results, and that we will meet the following newguidance:

• RevenuesofCHF380millionto400million,agrowthof0%to5%over2018

• EBITDAofbetweenCHF50millionto60million• EBITofbetweenCHF15millionto27million• Basedonaverageforeignexchangeratesasof2018.

u-bloxHoldingAG,ThalwilCondensedconsolidatedinterimfinancialstatements June30,2019

|Financialsummary

Financialsummary|

(inCHF000s)June30,2019(unaudited) December31,2018

Assets

Currentassets



Trade accounts receivables 52’607 60’802

Other receivables 13’816 11’197

Currenttaxassets 3’090 1’574

Inventories 58’172 57’486

Prepaidexpensesandaccruedincome 7’335 7’685

Derivativefinancialassets 684 473

Totalcurrentassets 258’083 276’914

Non-currentassets

Property,plantandequipment 13’707 14’829

Right-of-use assets 19’460 0

Goodwill 54’068 55’231

Intangibleassets 212’113 193’445

Financial assets 1’055 1’063

Equity-accountedinvestees 10’039 7’978

Deferredtaxassets 6’987 3’570

Totalnon-currentassets 317’429 276’116

Total assets 575’512 553’030

Liabilitiesandequity

Currentliabilities

Tradeaccountspayable 23’372 21’562

Otherpayables 6’969 7’206

Currenttaxliabilities 0 3’200

Provisions 75 0

Accruedexpenses 23’280 23’508

Totalcurrentliabilities 53’696 55’476

Non-currentliabilities

Financial liabilities 119’292 119’165

Otherpayables 53 56

Provisions 8’000 6’948

Pension liabilities 18’339 17’958

Lease liabilities 19’506 0

Deferredtaxliabilities 8’260 4’472

Non-currenttaxliabilities 0 78

Totalnon-currentliabilities 173’450 148’677

Total liabilities 227’146 204’153

Shareholders’equity

Share capital 6’391 6’390

Share premium 55’309 66’296

Treasuryshares -32’031 -32’031

Cumulativetranslationdifferences -16’604 -14’225

Retained earnings 335’301 322’447

Totalequity,attributabletoequityholdersoftheparent 348’366 348’877

Totalliabilitiesandequity 575’512 553’030

Thesecondensedinterimfinancialstatementsshouldbereadinconjunctionwiththeaccompanyingnotes.

Consolidatedstatementoffinancialposition


Page10|Financialsummary

Consolidatedincomestatement

(inCHF000s)Jan.–June30,2019

(unaudited)Jan.–June30,2018

(unaudited)

Revenue 190’554 198’983

Costofsales -104’772 -105’395

Grossprofit 85’782 93’588

Distributionandmarketingexpenses -18’556 -18’829

Researchanddevelopmentexpenses -42’368 -36’717

Generalandadministrativeexpenses -11’320 -10’562

Other income 1’368 1’063

Operatingprofit 14’906 28’543

Finance income 1’762 5’364

Finance costs -3’157 -1’042

Shareoflossofequity-accountedinvestees,netoftaxes -1’989 -1’443

Profitbeforeincometax(EBT) 11’522 31’422

Incometaxexpense -1’872 -6’339

Netprofit 9’650 25’083

Basicearningspershare(inCHF) 1.39 3.59

Dilutedearningspershare(inCHF) 1.39 3.58


Financialsummary|Page11

(inCHF000s)Jan.–June30,2019

(unaudited)Jan.–June30,2018

(unaudited)

Netprofitfortheperiod 9’650 25’083

OthercomprehensiveincomeRemeasurementsonpensionliability 407 927

Incometaxonremeasurementsonpensionliability -79 -181

Itemsthatwillnotbereclassifiedtoincomestatement 328 746

Currencytranslationdifferences -2’379 -1’924

Itemsthatareormaybereclassifiedsubsequentlytoincomestatement -2’379 -1’924

Othercomprehensiveincomefortheperiod,netoftaxes -2’051 -1’178

Totalcomprehensiveincome,attributabletoownersoftheparent 7’599 23’905

Consolidatedstatementofcomprehensiveincome



Consolidatedstatementofchangesinequity

(inCHF000s)Sharecapital

Share premium

Treasuryshares

Cumulative trans-lation

differencesRetainedearnings

Totalequity,

attribut-able to equity

holdersoftheparent

BalanceatJanuary1,2018 6’261 66’579 -24’422 -10’204 280’298 318’512

Netprofitfortheperiod 0 0 0 0 25’083 25’083

Othercomprehensiveincomefortheperiod,netoftaxes 0 0 0 -1’924 746 -1’178

Total comprehensive income 0 0 0 -1’924 25’829 23’905

Share-basedpayments1) 0 0 0 0 5’399 5’399

Dividendoutofsharepremium 0 -15’441 0 0 0 -15’441

Optionsexercisedduringtheyear,netoftransactioncosts 114 13’486 0 0 0 13’600

Totaltransactionswithequityholdersoftheparent 114 -1’955 0 0 5’399 3’558

BalanceatJune30,2018(unaudited) 6’375 64’624 -24’422 -12’128 311’526 345’975

BalanceatJanuary1,2019 6’390 66’296 -32’031 -14’225 322’447 348’877

Netprofitfortheperiod 0 0 0 0 9’650 9’650

Othercomprehensiveincomefortheperiod,netoftaxes 0 0 0 -2’379 328 -2’051

Total comprehensive income 0 0 0 -2’379 9’978 7’599

Share-basedpayments1) 0 0 0 0 2’876 2’876

Dividendoutofsharepremium 0 -11’077 0 0 0 -11’077

Optionsexercisedduringtheyear,netoftransactioncosts 1 90 0 0 0 91

Totaltransactionswithequityholdersoftheparent 1 -10’987 0 0 2’876 -8’110

BalanceatJune30,2018(unaudited) 6’391 55’309 -32’031 -16’604 335’301 348’366

1) RepresentstheamountofstockoptionexpenseofCHF2.3million(2018:CHF4.3million)includingrespectivetaxeffectsofCHF0.6million(2018:CHF1.1million)recognizedfor2019and2018respectively.



Consolidatedstatementofcashflows

(inCHF000s)Jan.-June2019

(unaudited)Jan.-June2018

(unaudited)

Netcashgeneratedfromoperatingactivities 33’111 13’736

Netcashusedininvestingactivities -32’591 -35’158

Netcashgeneratedfrom/(usedin)financingactivities -15’360 -3’654

Netincrease/(decrease)incashandcashequivalents -14’840 -25’076

Cashandcashequivalentsatbeginningofperiod 136’296 169’624

Effectofexchangeratefluctuationsoncashandcashequivalents -481 3’291

Cashandcashequivalentsatendofperiod 120’975 147’839

1) Netcashusedininvestingactivitiesconsistsofinvestmentsintoproperty,plantandequipmentofCHF3.4million(June30,2018CHF4.3million)andinvestmentsintointangibleassetsofCHF26.4million(June30,2018CHF27.6million)inthefirsthalfyear2019.

2) NetcashprovidedbyfinancingactivitiescontainstheexerciseofemployeestockoptionsofCHF91thousand(June30,2018CHF13.6million),thedividendpaymentoutofreservesfromcapitalcontributionsofCHF11.1million(June30,2018CHF15.4million).

1)

2)

1)

2)

Notestothecondensedconsolidatedinterimfinancialstatements


1 Basisofpreparationofthecondensedconsolidated

interimfinancialstatements

Thecondensedconsolidatedinterimfinancialstatementsofu-bloxHoldingAG(‘u-blox’orthe‘Group’)werepreparedinaccordancewithIAS34“InterimFinancialReporting”.Thesecondensedconsolidatedinterimfinancialstatementsdonotincludeallthenotescontainedintheconsolidatedannualfinancialstatements,andforthatreasonshouldbereadinconjunctionwiththeconsolidatedannualfinancialstatementsfortheyearendedDecember31,2018.

ThecondensedconsolidatedinterimfinancialstatementshavebeenpreparedinSwissfrancs(CHF),roundedtothenearestthousand,exceptforpershareamounts.

Thepreparationofthecondensedconsolidatedinterimfinancialstatementsrequiresmanagementjudgments,esti-matesandassumptionsthataffecttheapplicationofpoliciesandreportedamountsofassetsandliabilities,incomeandexpensesaswellasdisclosureofcontingentassetsandliabilities.

Althoughthesejudgments,estimatesandassumptionsarebasedonmanagement’sbestknowledgeofcurrenteventsandactions,actualresultsmayultimatelydifferfromthoseestimates.

Inthesecondensedconsolidatedinterimfinancialstatementssignificantestimatesandassumptionsmadebymanage- mentarenotdifferentfromthosedisclosedintheconsolidatedfinancialstatementsfortheyearendedDecember31,2018.

Incometaxesarerecognizedbasedonbestestimateoftheweightedaverageannualtaxratefor2019.

TheGroupoperatesinmarketswherenosignificantseasonalorcyclicalvariationsinrevenueareexperiencedduringthefinancialyear.

ThefollowingrateswereusedtotranslatethefinancialstatementsoftheGroup’sentitiesintoCHFforconsolidationpurposes:

June30,2019 December31,2018

Averagerate Closingrate Averagerate Closingrate

EUR 1.12928 1.11213 1.15493 1.12874

USD 0.99950 0.97848 0.97809 0.98370

GBP 1.29332 1.24248 1.30535 1.25284

Changesinaccountingpolicies

Exceptasdescribedbelow,theaccountingpoliciesappliedintheseinterimfinancialstatementsarethesameasthosedescribedintheGroup’sconsolidatedfinancialstatementsfortheyearendedDecember31,2018.Thechangesin accountingpoliciesarealsoexpectedtobereflectedintheGroup’sconsolidatedfinancialstatementsfortheyearendedDecember31,2019.

IFRS16LeasingTheGrouphasadoptedIFRS16LeasesasofJanuary1,2019usingthemodifiedretrospectiveapproach.IFRS16introducesasingle,on-balance-sheetleaseaccountingmodelforlessees.Alesseerecognizesaright-of-assetrepresentingitsrighttousetheunderlyingassetandaleaseliabilityrepresentingitsobligationtomakeleasepayments.


DefinitonofaleasePreviously,theGroupdeterminedatcontractinceptionwhetheranarrangementwasorcontainedaleaseunderIFRIC4DeterminingWhetheranArrangementcontainsaLease.TheGroupnowassesseswhetheracontractisorcontainsaleasebasedonthenewdefinitionofalease.UnderIFRS16,acontractis,orcontains,aleaseifthecontractconveysarighttocontroltheuseofanidentifiedassetforaperiodoftimeinexchangeforconsideration.

OntransitiontoIFRS16,theGroupelectedtoapplythepracticalexpedienttograndfathertheassessmentofwhichtransactionsareleases.ItappliedIFRS16onlytocontractsthatwerepreviouslyidentifiedasleases.ContractsthatwerenotidentifiedasleasesunderIAS17andIFRC4werenotreassessed.Therefore,thedefinitionofaleaseunderIFRS16hasbeenappliedonlytocontractsenteredintoorchangedonorafterJanuary1,2019.

As a lesseeTheGroupleasesmainlypropertiesandcars.

Asalessee,theGrouppreviouslyclassifiedleasesasoperatingorfinanceleasesbasedonitsassessmentofwhethertheleasetransferredsubstantiallyalloftherisksandrewardsofownership.UnderIFRS16,TheGrouprecognizesright-of-useassetsandleaseliabilitiesformostleases–i.e.theseleasesareon-balancesheet.

However,theGrouphaselectednottorecognizeright-of-useassetsandleaseliabilitiesforsomeleasesoflow-valueassets.TheGrouprecognizestheleasepaymentsassociatedwiththeseleasesasanexpenseonastraight-linebasisovertheleaseterm.

TheGrouppresentsright-of-useassetsthatdonotmeetthedefinitionofinvestmentpropertyin“property,plantandequipment”,thesamelineitemasitpresentsunderlyingassetsofthesamenaturethatitowns.Thecarryingamountsofright-of-useassetsareasbelow:

(inCHF000s) Right-of-useassets

BalanceatJanuary1,2019 21’710

BalanceatJune30,2019 19’460

TheGrouprecognizesaright-of-useassetandaleaseliabilityattheleasecommencementdate.Theright-of-useassetisinitiallymeasuredatcost,andsubsequentlyatcostlessanyaccumulateddepreciationandimpairmentlosses,andadjustedforcertainremeasurementsoftheleaseliability.

Theleaseliabilityisinitiallymeasuredatthepresentvalueoftheleasepaymentsthatarenotpaidatthecommencementdate,discountedusingtheinterestrateimplicitintheleaseor,ifthatratecannotbereadilydetermined,theGroup’sincrementalborrowingrate.Generally,theGroupusestheincrementalborrowingrateasthediscountrate.

Theleaseliabilityissubsequentlyincreasedbytheinterestcostontheleaseliabilityanddecreasedbyleasepaymentsmade.Itisremeasuredwhenthereisachangeinfutureleasepaymentsarisingfromachangeinanindexorrate,achangeintheestimateoftheamountexpectedtobepayableunderaresidualvalueguarantee,orasappropriate,changesintheassessmentofwhetherapurchaseorextensionoptionisreasonablycertaintobeexercisedoraterminationoptionisreasonablycertainnottobeexercised.

TheGrouphasappliedjudgementtodeterminetheleasetermforsomeleasecontractsinwhichitisalesseethatincluderenewaloptions.TheassessmentofwhethertheGroupisreasonablycertaintoexercisesuchoptionsimpactstheleaseterm,whichsignificantlyaffectstheamountofleaseliabilitiesandright-of-useassetsrecognized.

|Financialsummary

TheGroupusedthefollowingpracticalexpedientswhenapplyingIFRS16toleasespreviouslyclassifiedasoperatingleasesunderIAS17:

- Appliedtheexemptionnottorecognizeright-of-useassetsandliabilitiesforleaseswithlessthan12months ofleaseterm.- Usedhindsightwhendeterminingtheleasetermifthecontractcontainsoptionstoextendorterminatethe lease.

TheadjustmenttoopeningretainedearningsasofJanuary1,2019wasCHFzeroandtheimpactonthestatementoffinancialpositionatJune30,2019wasasfollows:

(inCHF000s)June30,2019

(unaudited)

Right-of-use assets 19‘460

Total assets 19‘460

Equity -46

Lease liabilities 19’506

Total liabilities 19‘460

Theimpactonthestatementofprofitorloss(increase/(decrease))forthesixmonthsendedJune30,2019was:

(inCHF000s) January1,2019

OperatingleasecommitmentatDecember31,2018asdisclosedinthegroup’sconsolidatedfinancialstatements 25’426

DiscountedusingtheincrementalborrowingrateatJanuary1,2019 24’229

FinanceleaseliabilitiesrecognizedasatDecember31,2018 0

Recognitionexemptionforleasesoflow-valueassetsandleaseswithlessthan 12monthsofleasetermattransition -2‘654

Extensionoptionsreasonablycertaintobeexercised 135

LeaseliabilityrecognizedasatJanuary1,2019 21’710

Theimpactonthestatementofcashflows(increase/(decrease))forthesixmonthsendedJune30,2019was:

(inCHF000s)June30,2019

(unaudited)

Netcashflowsfromoperatingactivities 2’605

Netcashflowsfromfinancingactivities 2’605


2 Segment informationInaccordancewiththemanagementstructureandthereportingmadetotheBoardofDirectors(theGroup’sChiefOperatingDecisionMaker,whichistheBoardofDirectorsofu-bloxHoldingAG),thereportablesegmentsarethetwooperatingCorporateGroups’PositioningandWirelessproducts’and’Wirelessservices’.SegmentaccountingisprepareduptothelevelofOperatingProfit(EBIT)becausethisisthekeyfigureusedformanagementpurposes.AlloperatingassetsandliabilitiesthataredirectlyattributableorcanbeallocatedonareasonablebasisarereportedintherespectiveCorporateGroups.Nodistinctionismadebetweentheaccountingpoliciesofsegmentreportingandthoseoftheconsolidatedfinancialstatements.Nooperatingsegmentswereaggregated.

Thefollowingreportablesegmentswereidentified.

Positioning and Wireless productsTheGroupdevelopsanddistributesGPS/GNSSpositioningreceiversandwirelesscommunicationmoduleswhicharemainlyusedinautomotive,industrialandconsumerapplications.Productsaremarketedandsoldbytheu-bloxworldwidesalesorganization.Theproductsaremanufacturedbythirdparties.TheGroupcoordinatesthewholesupplychainandmanagestheworld-wideproductionanddistributionoftheproducts.

Wireless servicesSincetheacquisitionsofu-bloxItaliaS.p.A.andu-bloxSanDiego,Inc.,u-bloxoffersalsoservicesinthewirelesscommunicationtechnologywhichformsaseparatebusinesssegmentastheseproductsconsistofdeliveryofreferencedesignsandsoftware.

PositioningandWirelessproducts

Wireless services

Totalsegments

Non-allocated/Eliminations Group

January–June January–June January–June January–June January–June

(inCHF000s) 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018

Revenue third 190’433 198’877 121 106 190’554 198’983 0 0 190’554 198’983

Revenue intragroup 0 0 15’871 16’043 15’871 16’043 -15’871 -16’043 0 0

Totalrevenue 190’433 198’877 15’992 16’149 206’425 215’026 -15’871 -16’043 190’554 198’983

EBITDA 25’933 39’623 3’137 430 29’070 40’053 0 0 29’070 40’053

Depreciation -4’945 -3’392 -1’570 -1’252 -6’515 -4’644 0 0 -6’515 -4’644

Amortization -7’638 -6’851 -11 -15 -7’649 -6’866 0 0 -7’649 -6’866

Operatingprofit 13’350 29’380 1’556 -837 14’906 28’543 0 0 14’906 28’543

Financial income 1’762 5’364

Finance costs -3’157 -1’042

Share of loss of equity-accountedinvestees,netoftaxes -1’989 -1’443

Profitbeforeincometax 11’522 31’422

|Financialsummary



(unaudited)

Automotive 57’230 57’530

Consumer 14’635 20’797

Industrial 109’529 109’673

Others 9’160 10’983

Total 190’554 198’983

3 Revenuerecognition

Revenuebymarket



(unaudited)

Module 143’574 146’170

Chips 46’784 47’972

Others 196 4’841

Total 190’554 198’983

Revenuebyproducttype



(unaudited)

EMEA thereof:Switzerland Germany

61’0451’510

16’189

70’2371’033

17’187

America thereof:UnitedStatesofAmerica

40’03734’052

42’44936’536

AsiaPacific thereof:China

89’47243’622

86’29738’141

Total 190’554 198’983

Revenuebyregion(basedonbillinglocation)


(inCHF000s)Carryingamount

June30,2019Carryingamount

Dec31,2018


Trade accounts receivable 52’607 60’802

Other receivables 1’379 352

Accrued income 743 769

Financial assets 1’055 1’063

Financialassetsatamortizedcosts 55’784 62’986


Derivativefinancialassets 684 473

Financialassetsatfairvaluethroughprofitorloss 2’088 1’874

Tradeaccountspayable 23’372 21’562

Otherpayables 5’553 6’556

Accruedexpenses 11’779 11’952

Non-derivativefinancialliabilities 119’292 119’165

Liabilitiesatamortizedcost 159’996 159’235

Otherpayables-contingentconsideration 55 56

Liabilitiesatfairvaluethroughprofitandloss 55 56

4 Financialinstruments

5 Dividend

OnApril25,2019theAnnualGeneralMeetingofu-bloxHoldingAGapprovedagrossdividendofCHF1.60pershare. AtotaldividendamountofCH11.1millionwaspaidoutonMay3,2019.

6 Guarantees,pledgesinfavorofthirdpartiesand

other contingent liabilities

AtJune30,2019andDecember31,2018therewerenoguaranteesinfavorofthirdparties.Thegroupisnotexposedtoanysignificantothercontingentliabilities.Thereisnoknownthreatenedorpendinglitigationagainstanygroupcompany.

7 Eventsafterthebalancesheetdate

OnJuly31,2019,theGroupacquiredRigadoInc.’sBluetoothmodulebusinessinanagreement,whichisabusinesscombinationaccordingtoIFRS3. ThepurchasepriceisUSD7.4million.Thecompanywillperformthepurchasepriceallocationinthesecondhalfof2019.TheBoardofDirectorsauthorizedonAugust22,2019thesecondensedconsolidatedinterimfinancialstatementsforpublication.

Thefollowingtableshowsthecarryingamountofallfinancialinstrumentspercategory.Withtheexceptionoffinancialliabilities,theycorrespond,approximately,tothefairvaluesinaccordancewithIFRS.Thefairvalueoffinancialliabilitiesisdisclosedinthetable“Fairvaluehierarchy”.

Fairvaluehierarchy Thedifferentlevelsoffinancialinstrumentscarriedatfairvalueorforwhichthefairvalueisdisclosedhavebeendefinedasfollowsinthetablebelow:Level1: quotedprices(unadjusted)inactivemarketsforidenticalassetsorliabilities.Level2: inputsotherthanquotedpricesincludedwithinlevel1thatareobservablefortheassetortheliability, eitherdirectly(i.e.asprices)orindirectly(i.e.derivedfromprices).Level3: inputsforassetsorliabilitiesthatarenotbasedonobservablemarketdata(unobservableinputs).

June30,2019(inCHF000s)

Carryingamounts Fairvalue

Total Level1 Level2 Level3

Marketable securities 1’404 1’404 0 0

Derivativefinancialassets 684 0 684 0

Total assets 2’088 1’404 684 0

Otherpayables–contingentconsideration 55 0 0 55

Non-derivativefinancialliabilities 119’292 122’280 0 0

Total liabilities 119’347 122’280 0 55

December31,2018(inCHF000s) Total Level1 Level2 Level3

Marketable securities 1’401 1’401 0 0

Derivativefinancialassets 473 0 473 0

Total assets 1’874 1’401 473 0

Otherpayables–contingentconsideration 56 0 0 56

Non-derivativefinancialliabilities 119’165 118’140 0 0

Total liabilities 119’221 118’140 0 56


InformationforInvestors|Page21

u-bloxHoldingAG

Corporateaddress

Investorrelations

Website

Financial calendar

Tickerdetailsforu-bloxshares•Listing SIXSwissExchange•Tickersymbol UBXN•ISIN-No. CH0033361673•SwissSecurity-No. 3336167•Reuters UBXN.S•Bloomberg UBXN:SW

u-bloxHoldingAGZürcherstrasse688800ThalwilSwitzerlandPhone+41447227444Fax +41447227447

Thomas SeilerChiefExecutiveOfficerE-mail:[email protected]

RolandJudChiefFinancialOfficerE-mail:[email protected]

www.u-blox.com

•Analystday November20,2019•Fullyearresults2019 March12,2020•AnnualGeneralMeeting April23,2020

InformationforInvestors

mailto:roland.jud%40u-blox.com?subject=Half%20Year%20Report%202012

http://www.u-blox.com

| Worldwide presence

Disclaimer

Thisreleasecontainscertainforwardlookingstatements.Suchforwardlookingstatementsreflectthecurrentviewsofmanagementandaresubject

toknownandunknownrisks,uncertaintiesandotherfactorsthatmaycauseactualresults,performanceorachievementsoftheu-bloxGroupto

differmateriallyfromthoseexpressedorimplied.TheseincluderisksrelatedtothesuccessofanddemandfortheGroup’sproducts,thepotential

fortheGroup’sproductstobecomeobsolete,theGroup’sabilitytodefenditsintellectualproperty,theGroup’sabilitytodevelopandcommercialize

newproductsinatimelymanner,thedynamicandcompetitiveenvironmentinwhichtheGroupoperates,theregulatoryenvironment,changesin

currencyexchangerates,theGroup’sabilitytogeneraterevenuesandprofitability,andtheGroup’sabilitytorealizeitsexpansionprojectsinatimely

manner.Shouldoneormoreoftheserisksoruncertaintiesmaterialize,orshouldunderlyingassumptionsproveincorrect,actualresultsmayvary

materiallyfromthosedescribedinthisreport.u-bloxisprovidingtheinformationinthisreleaseasofthisdateanddoesnotundertakeanyobligation

toupdateanyforwardlookingstatementscontainedinitasaresultofnewinformation,futureeventsorotherwise.

ThispressreleaseispublishedinGermanandEnglish.ShouldtheGermantranslationdifferfromtheEnglishoriginal,theEnglishversionisbinding.

Imprint

Publisher/Copyright:August2019u-bloxHoldingAG,Thalwil,Switzerland.

R&DcenterEspoo,FITampere,FIMalmö, SEReigate, UKCambourne,UKLuton, UKCork,IELeuven, BE

R&DcenterBerlin,GermanySgonico,ItalyAthens,GreeceLahore, Pakistan

AmericasregionalofficeReston,VA,USA

RegionalofficeR&DcenterSalem, OR, USA

R&DcenterSanDiego,CA,USA

Corporateheadquarters EMEAregionalofficeR&DcenterThalwil, Switzerland

APACregionalofficeSingapore

APACareaoffices

Beijing,China

Seoul, Korea

Tokyo,Japan

Osaka,Japan

Shanghai,China

Wuhan,China Chongqing,China

Taipei, Taiwan

Shenzhen,China

Bangalore,India

Sydney,Australia

Melbourne, Australia

Worldwide presence

www.u-blox.com

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