Veoneer has recorded third-quarter net sales up 5% to US$391m.
Business Highlights:
- Entered into a definitive merger agreement, under which SSW and Qualcomm will acquire Veoneer, terminated merger agreement with Magna International
- Organic Sales growth outperformed the global LVP by ~23pp during Q3, 21
- Semiconductor supply chain shortages continue to create industry production, delivery and cost challenges
- Temporary inventory build-up negatively impacted cash flow, expect the effect to reverse in fourth quarter
- ADAS and AD software unit Arriver performed first public demonstration running on the Snapdragon Ride platform, at IAA, Munich with positive feedback and reviews
- Veoneer announced as key active safety contributor to Mercedes S-Class with 4th generation Vision and Perception software, enabling Level 3 self-driving
- Order intake over the Last Twelve Months (LTM) was more than US$500m of average annual sales at the end of Q3, 21
“Veoneer showed strong operational performance during the third quarter,” said Veoneer chairman, president and CEO, Jan Carlson. “Despite a sequential drop in the light vehicle production of 12%, our net sales were essentially flat, sequentially. Through our market adjustment initiatives, we also managed to improve our gross profit and reduce our operating loss sequentially and year-over-year.
“The global underlying demand for all of our products remains very strong, but as is true for many industries and companies today, semiconductor shortages and supply chain constraints continue to hamper our growth. We are managing this situation daily and are doing our utmost to support our customers through this difficult situation.
“The gradual weakening of the LVP during the quarter was especially challenging where we saw a temporary build-up of inventory, which is reflected in our working capital and cash flow. We have taken initiatives to rectify the situation and I view this as another sign of our discipline and executional strength as the full year 2021 LVP expectation eroded from a 14% growth in the beginning of the year, to virtually flat growth from the depressed COVID-19 pandemic levels in 2020.
“Following the end of the quarter, we announced we signed a merger agreement with SSW and Qualcomm for the acquisition of Veoneer by SSW and subsequent transfer of Arriver to Qualcomm. The board of directors determined the $37 per share, all cash transaction offered by SSW and Qualcomm was superior to the previous transaction agreement with Magna International.
“The proposed transaction with SSW and subsequent SSW-Qualcomm transaction are pending and subject to various conditions and we will provide updates as appropriate.”
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