Softing has chosen the operating EBIT (EBIT adjusted for capitalized product development, its depreciation and effects of the purchase price allocation of companies acquired) as its prime KPI for the time of the Covid pandemic dominating the worldwide economic environment. The company communicated an operating EBIT between EUR 0 and EUR 0.5 million as its expectation for 2020.
Based on preliminary numbers Softing has achieved an operating EBIT of approx. EUR 1,6 million in 2020 and therefore clearly exceeded the expectations. This has been achieved by an unexpectedly strong fourth quarter, especially on high margin products and services of Softing’s single biggest business segment “Industrial Automation”. Revenues in North America and Asia came in significantly above expectations. The business segment “IT Networks” has also performed very well due to an unexpected demand by customers. For some IT Networks products customer demands could not be satisfied until late in January 2021. The total revenue of the Softing group amounted to approx. EUR 78 million.
We expect the need to adjust the value of a certain product assigned to the “Automotive Electronics” segment. This product is designed for use in test riggs of reciprocating combustion engines. Due to changes in our customer’s power train strategy we do not expect this product to reach the previously defined revenue expectations. Softing responds to these changes by focusing its resources on products for hybrid and fully electric powered vehicles as well as for products and services with respect to autonomous driving. The adjustment is expected to reduce the EBIT by approx. EUR 3.5 million. This is a onetime adjustment without consequences to operating EBIT or cash.
The complete annual report for the year 2020 will be available on www.softing.com by the end of March.