Jenoptik AG (JEN) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen, and welcome to the Jenoptik conference call regarding the results of the first half year 2023. [Operator Instructions] Let me now turn the floor over to your host, Dr. Stefan Traeger.

Thank you very much, and a very warm welcome from our end here at -- is actually quite funny in City of Jena today. With me is Prisca Havranek-Kosicek, our CFO, and we are delighted to share with you not just our numbers of the first half 2023. But also to give you sort of an update of how our business developed and outlook to the rest of the year. Before we get started, just a quick comment from my end on the latest news at the TSMC consortiums going to invest a lot of EUR 10 billion into new chip factory in Dresden, really, actually quite literally, just the stone throw away from our own factory over there. It is, from my point of view, a very important testimony of the strength of the chip industry here in our region. We're all aware the investments marketable by Intel, Infineon in Dresden and [indiscernible] by a number of large players. And now this next investment of EUR 10 billion in the new chip factory, here in Norwegian is, as I say, a very important testimony of the strength as I mentioned. It also shows that our commitment and investment into this business field is going to pay off, and you're very much behind that. I think it has been the right decision to invest into our semi-connectivity. It is a lot of money we put in motion here, but I'm convinced, we are convinced that it's the right investment. And I think I say those latest news, yes, it's certainly not assessment in fact. With that said, just a quick overview of how Jenoptik developed in the first half, and then I'll pass the floor over to -- mic over to the Prisca to go into the numbers in more detail. From our point of view, we have seen a very strong business development in the first half of 2022. We're very proud of what our teams have made possible, to be honest. It's been another double-digit revenue growth half year. We have seen sales growing by almost 13%. And again, that's all organic over what has been already a very strong H1 2022. So thanks to our teams for making that possible. At the same time, our EBITDA margins or operating profit has expanded yet another lead actually from 15.6% of sales last year to now 18.1%. And those of you who follow us, it's a bit longer, you know that typically, Jenoptik post more profit in the second half than in the first half. And again, that's a testimony of the strength of our company at the moment. So very proud of that, very proud of the double digit, almost 13% base growth, significant EBITDA margin expansion and [indiscernible] post in this first half 2023. We do see order intake slightly softer than in the comparator -- compared to the H1 last year. Order intake is slightly below. However, again, here, let me please point out that the comparative is actually very tough. We had a significant order growth in particularly Q1 and then also in Q2 in 2022. So the comparator is very tough, and that is why, yes, we do see orders somewhat softening, but not to a sort of huge extent here. I think what's more important, it is very important from our point of view is that in the first half of 2023, we still have a book-to-bill of above 1 despite all the efforts of us to ramp up our sales capacity, we still take more orders and then we can convert into sales. And that, as a result, does mean that our order backlog, not just remained at a high level, but it actually grew once again in H1 2023. Again, we do focus on output optimization. We have communicated that we expand our capacities. We've opened up the new site in Berlin for our medical technology activities. We're working hard on our new factory in Dresden, but not only in Dresden and in Berlin, we expand our capacities, we've also invested into new floor space and capacity in Jupiter a very important site for us in Florida. We do invest into new machines here in Jena for our core optics facilities. So output optimization and capacity expansion is very much in focus. It's basically another way of saying Jenoptik is currently focusing on organic growth. We drive organic growth at the moment, and I think quite successfully. We do confirm our guidance in full. We will see a substantial increase in revenue and margin expansion. We come to that at the end of the presentation, and as I say, based on our results of H1 despite the fact that the environment might be a bit softer in some parts of the company. But overall, we have seen a strong H1, and we do confirm our guidance on sales and margin, although we do see order intake maybe somewhat below last year, but not to a large extent. With that, I'll hand over to you, Prisca.

Thank you, Stefan. Good morning, and a warm welcome from my side as well. First of all, I would like to reiterate what Stefan said, we had a very strong business development in the first half of 2023, which is overall in line with our expectations. Now let me give you some more insight into our performance on group level. Let's start with market demand on Page 6. Order intake in the first half year was at EUR 547 million. As Stefan has mentioned, this is a robust level, but it is down 10% compared to a very strong prior year. And as a reminder, which was also mentioned earlier, the half -- H1 last year for both APS and SMS generating organic order intake growth in excess of 15% each. So clearly above our underlying organic growth trajectory. So as was mentioned before, the comps are very high in this period. Overall, order intake in H1 was in line with our expectations. As you can also see here, our book-to-bill ratio on group level has reduced versus prior year, but remains above 1. We saw this development as well in the divisional levels. Similar to what you've seen at the end of Q1, our order backlog continues to stay on a very high level. It was up around 5% compared to the end of last year, which again, of course, provides us with a strong basis for the coming quarters. We expect to convert roughly 60% or in absolute terms, EUR 460 million of this backlog into revenue within this fiscal year still. Now turning to revenue and profit development on Page 7. We saw another quarter with strong top line development. Revenue increased close to 13% in the first half. As Stefan mentioned, we had no effects from portfolio changes. So this growth is purely organic and also FX had virtually no impact on the top line development in H1. The main growth drivers in this period were both our divisions Advanced Photonic Solutions and Smart Mobility Solutions, where we saw the sales up with double-digit rates, whereas in our non-portfolio companies, they were posting low single-digit revenue growth. Each of our main reporting regions reported higher revenues, most notable in Asia Pacific, up by 24%, in Europe with plus 16%. Our share of revenue outside Germany remains stable at around 3/4 of our total revenue. Moving on to profitability. Looking at the right side of the slide here, you can see that again, we have improved our profitability and the strong sales growth converting to a substantial profit and margin improvement. Group EBITDA in the first half of fiscal '23 came in at close to EUR 92 million. In H1, we saw a top line increase of EUR 58 million and an EBITDA increase of EUR 22 million year-over-year, has a very solid flow-through from revenue of 38%. Looking at profit from a divisional perspective, the main contributor in absolute terms is the APS division, but also the turnaround of our non-photonic portfolio companies contributed significantly. Our group EBITDA margins, as Stefan mentioned before, gross markedly from 15.6% to 18.1%, which is an expansion of 250 basis points. And Stefan will go back to the divisional performance in greater detail later on this call. Now moving to Page 8. I would like to give you a little bit more color on what is driving this margin -- expansion in margin growth. First of all, we saw gross margin expand by 200 basis points year-over-year, driven by, a, a strong top line growth at APS at stable margins as well as gross margin improvements at the NPPC. In addition, as you can see here, we continue to remain disciplined in our OpEx, which results in functional expenses growing at a much lower rate than revenues. Now let me briefly, maybe, also explain what's going on in our other operating results. Here, you can see we are down year-over-year by EUR 7 million for 2 main reasons. First, we recognized some losses relating to FX, compared to a small positive contribution last year. And also, we took an impairment charge of EUR 4 million in connection with the sale of our 33% stake in Jenoptik Korea. And as the backlog, we've taken the step to disentangle across participation structure in Korea, which Jenoptik has helped for many years. Since at the same time, we have signed a contract to acquire the remaining shares in the Jenoptik Korea which we did not yet own. So as a result, going forward, we will own 100% of Jenoptik Korea. This was a onetime noncash charge, which did not impact our EBITDA line, but is included in EBIT which, as you can see on the left, was up by 46% and reached EUR 54 million in H1. Our financial results of minus EUR 7.8 million in the first half year is primarily reflecting the substantial rise in interest rates. As you know, about 1/3 of our debt is at floating interest. EPS for the half year is up 37% to EUR 0.56 versus EUR 0.41 a year ago. So overall, we reported a solid set of earnings in the first half of 2023. Now turning to Page 9. Looking at cash flows. What you see here is a good move forward versus last year. However, seasonally cash generation in H2 tends to be more stronger than in H1, so we will see some more impact there. Operating cash flow pretax is growing at a similar rate of EBITDA, and that's despite some investment into working capital, where, for sure, we still have some work to do. On the investment side, as Stefan has mentioned before, we are continuing to focus on our capacity expansion, hence, our CapEx increased to around EUR 53 million, which is up from EUR 42 million last year. Net debt increased slightly versus the end of last year due to the dividend payment in June and tax payments, which are not included in the free cash flow. Our leverage stands at 2.4x compared to 2.6x at the end of '22. And with this, let me turn back to Stefan to cover our division.

Thanks, Prisca. And like always, that's all with Advanced Photonic Solutions. If you follow me on Page 11 of our presentation deck here, you'll see our figures and numbers from APS. The APS order intake declined by 9.5% this year or this first half of the year, which is to be seen in light of various as I said earlier, very challenging comparator. APS order intake in H1 2022 grew 55% granted that was with acquisitions, but even organically, if you strip out the acquisition effect of the order intake growth in 2022, you still had 21% order intake growth first half last year. Thus, yes, orders are a bit softer at APS, but if you integrate over both years, still a very, very strong order intake perspective and development driven in particular by our semiconductor equipment business. Revenue rose by 13.3%, and here again, I do like to thank our teams here for making that happen. Really our factories, in particular, on the optics and microoptics arena are -- yes, to put that, they're like running ahead at full steam and trying to pump out as much as possible to help our customers in their endeavors to grow their businesses. So thanks to our teams here and again, very strong development in the APS business, in particular, of course, driven by semiconductor equipment. And as a result, the EBITDA margin -- or the EBITDA, I should say, improved again. Margin is somewhat below prior year's level, but still very strong, almost 22% EBITDA of sales. And we're very happy with how APS develops. Let's go to our Smart Mobility Solutions. And in a way, I'd like to almost say is SMS is back to normal in many ways. Yes, order intake here as well is down by 17%, which is significant. That said, though, let's keep in mind that last year, we had some several major orders booked in the first half. Importantly, book-to-bill is still above 1, and that is despite the fact that sales grew by 22.4% in SMS, huge sales growth. However, that is, and that's why I'm saying it's back to normal. That is in light of challenges that those of you, who are with us in the while will remember has had last year, in particular in the first quarter and to some extent also in the second quarter in turning orders into sales. We were hindered by supply chain restrictions in SMS in particular in the first half last year, so the 44.7% last year were particularly weak, and the almost EUR 55 million this year is in a way back to normal. Nevertheless, we are proud of, of course, the 22% or 22.4% sales growth and the fact that despite the decline in order intake, we still post more orders that we can turn into sales, which again does mean that the order backlog grew again in the first half of this year. The result of the higher volume, the profitability, the operating profit is again, back to normal in a way. It's great to see EUR 4.4 million EBITDA for SMS. But again, it's basically back to normal from what has been a distorted H1 last year. If we go to NPC to our non-photonic portfolio companies, essentially our automotive business. Development might seem a bit similar yet. It's quite different actually. Here, operationally, we are, let's say, in the process of actually turning the corner. You do see that our profit figures yes, increased significantly. NPC contributed EUR 7 million EBITDA in the first half of this year. Yes, this is mainly driven by Prodomax, which is a very high-profit organization. But it's important for me to point out that also HOMMEL ETAMIC has posted positive operating profit in the first half of this year. So we do turn the corner in those businesses, which I think is promising. Sales are up slightly to now EUR 58.2 million, which is an increase of 2%. Order intake is down somewhat to now almost EUR 60 million in the first half. Here as well, order intake is still higher than sales, and we are still growing backlog, although in a small fashion in NPC. So if you take it together, APS continues to plow ahead. I mean, it's the only way to put it, continues to plow ahead, in particular, in semiconductor, we do have other parts in the APS business that are weaker. We all talked about those in the past already, and I'm pretty sure we will drill into that a bit more in the Q&A session in particular, when it comes to TRIOPTICS and a couple of our businesses with us. But overall, by and large, APS continues to plow ahead, very strong order -- sorry, sales growth results into a nice profitable margin expansion and the same in way can be set for all the other businesses as well. This development in the first half -- it's a basis for us to fully -- wholeheartedly confirm our sales and profit guidance for 2023. We do believe that the uptake in sales will come in between EUR 1.05 billion and EUR 1.1 billion at the end of this fiscal year. We do believe that we can expand our EBITDA margins to something between 19% and 19.5% at the end of this year. We do see that the order intake is somewhat softer, but still, we're not sort of falling off a cliff here in any way, shape or form. And again, in the first half, we still did build backlog. We have to see how that develops in the second half. But overall, we're very confident and that's a good sort of baseline for further growth also in future years. We do see capital expenditures higher than prior years. I think that's not a new news. But we do believe that it's going to peak this year and then tailing off in 2024 and 2025. So we're looking with, yes, overall optimism into the future, we're certainly looking very confident into a strong second half of this year. And with that, we are looking forward to receiving a lot of questions from you. Thanks very much.

[Operator Instructions] The first question comes from Martin Jungfleisch with BNP.

Congrats on a good set of results. Two questions, please. First of all, on APS orders. So Q2 orders were still quite good. But what is your sense of order development going into Q3? Have you seen anything significantly changed already in July on the positive or negative side in any of your end markets that you would call out? Or is that roughly on par with Q2 levels so far? And then secondly, specifically on TRIOPTICS, I think you mentioned in Q2 that orders are not -- I'm sorry, I think you mentioned in Q1 that orders are not falling off the cliff, but we would need some improvement in H2 to secure revenues for 2024. Can you provide a rough overview if that is still the case or if the order situation has worsened quarter-on-quarter here and maybe what your sense is for Q3 orders?

Yes. Thanks for your questions. I mean, obviously, we do not guide on orders quarter-over-quarter, but one qualitatively, just to give you sort of a picture here, I'd say that Q3 orders, I mean, we haven't seen any sort of major change in the last few -- I mean, it's 4 weeks, really early to tell. But we haven't seen any major change in the pattern in APS overall. And in particular, in TRIOPTICS, we still have the situation that order intake is weaker than anticipated. We need to generate orders there to enable the growth that we put into our business forecast and our business plans for the acquisition. So in a way, both questions flow into one. And the answer is we haven't seen a major change in the last few weeks in terms of the order intake pattern. Let me again underscore that this is not supposed to be, in any way, shape or form of guidance for Q3 or anything like that. But sort of, as I say, qualitatively, the last few days and weeks, we haven't seen a major change in pattern from what we have seen in Q2.

Okay. Maybe I can follow up on TRIOPTICS. So Apple is set to release this Vision Pro headsets in early 2024. Would that benefit TRIOPTICS? And if so, have you already orders -- received orders for that for the testing of the camera models?

We're not legally allowed to disclose with particular customers and customer names. As you know, we are very engaged in AR/VR or applications like, for example, the one you just mentioned. And we do generate from this segment, orders and sales at this moment, predominantly engineering orders and sales and income. We have not seen a major uptake yet for more volume business, but we are confident that at some point, it will turn from engineering into volume business. Again, I cannot comment on particular customer names, but the situation basically is the same that we had a few weeks back engineering income, no major volume income at the moment.

The next question comes from Adrian Pehl, Stifel.

I hope you can hear me well. So a couple of questions. First of all, on the free cash flow in the APS division, I assume that this was negative in the second quarter due to the fact that inventories build up, if so, is there a specific reason behind that? Because we didn't see that last year in that -- in the pattern actually building up. Any comments are clearly welcome on this. And a question linked to that. So should we assume that will revert in the second half quite strongly in the sense of there is no danger for your cash conversion outlook? And lastly, on CapEx. Actually, that obviously is as was guided for sure. I was just wondering if the second half will see even more CapEx, i.e., acceleration of what we have seen in the first half?

Yes. Thanks, Adrian, Prisca, if you can put a bit more meat to the bone, but from a overview here from my perspective. I think you're right that inventory is -- inventory buildup in APS has played a major role in Q2, which is to prepare ourselves for strong output in Q3, in particular Q4, so converting orders to sales in Q3 and particularly in Q4, need or requires the working capital to support the growth there. On the cash conversion guidance, I think we're fully behind our guidance of more than 50%. We'll achieve that. And CapEx, I don't see that as a major change. But maybe Prisca, if you have more detail.

Let me give you -- maybe starting with CapEx. Yes, we would expect CapEx in the second half to be above the first half of the year, also in line with what we are guiding for higher compared to previous year. On your question, APS, free cash flow, I think Stefan has answered that. Yes, we have had -- we have seen some investments into working capital, but we do expect seasonally working capital in APS and overall to come down towards the end of the year. I would say I expect year-over-year an improvement, but a slight improvement. And we said that also results that we are confident with our cash conversion guidance of above 50% of free cash flow. I hope that answers your question.

Yes. Just a quick additional question on the cost side of things, obviously, you had an increase in R&D, which is obviously good for an engineering-driven company, but this was more pronounced in the second quarter than your revenue growth. So I was wondering if you could share with us anything specific you are working on in terms of innovative product you might share with us in this call?

A good question. I think there was a major shift in the future...

I think there's no major change in our innovation pipeline. We are working on the same project, as you know, across all the divisions. However, what you see in that line is a slight increase in headcount that we've seen in some of our SKUs, in particular, in the APS division. So you see the effect of additional people in those -- in that line.

And probably also income from addition of salaries.

Obviously, the salary costs overall have increased. But in particular, you see additional FTEs in that -- in the R&D line.

Yes, but no major change actually. There's no like particular project or anything that at least just towards the figure significantly.

And the next question comes from Lasse Stueben, Berenberg.

I just wanted to have a question on NPC. The result there guiding Q2 was very solid. I'm just wondering has there been a structural improvement also in the underlying market? I understand that it's a function of INTEROB no longer negatively impacting the result. I'm just wondering if anything has changed underlying? And then following on from that, is the H1 sort of EBITDA, we've seen a decent run rate for the second half and also for this business going forward over the next few years?

Yes, you basically mentioned it, INTEROB is a major factor. As we've said in the Q1 earnings call already, INTEROB was a big profit drag in the past. And we fleshed out of the P&L at the end of last year already. So that basically that we stopped the bleeding of that in this part. Other than that, it's the same as in the last quarter. Prodomax being very strong in profit numbers and operating profit. HOMMEL being back, which is good, again, in terms of EBITDA, obviously, we do not disclose the individual numbers, but HOMMEL ETAMIC is EBITDA positive. I mean it's not like multiple millions, but it is EBITDA positive in some fashion, and that's good. This, I believe, has resolved more of -- it did take cost out in the past, and thus the sales that we see are now sort of covering the cost better than in 2021 and to some extent 2022. So it's a result of the restructuring that we've done in the past as a result of very strong development at Prodomax, and in particular, it is a result of us flashing INTEROB out of the P&L at the end of last year.

And maybe to add on to the run rate question for the profitability. I think you are right, you can take that run rate, very roughly, obviously, as a decent run rate for the business going forward this year.

Okay. And maybe one follow-up, if I may. Just given sort of the usual seasonality in the business, a H1 is, I mean, yes, not to sort of low you into any guidance for H2, but I mean, all signs point even more ending up towards that upper end? Is there anything you see that could change that in the near term, I guess, roundabout way of asking what's the biggest rate that you see in the second half of the year to the business?

I guess the best way to answer the -- let's say if you excuse some of provocative question is to say, we're very, very confident. I mean -- as you know, we basically -- we can sort of predict our business fairly accurately for the next few weeks and months. And for us to see a huge change in sales and profit in the remainder of the year. I mean if we have major impacts from the political environment, of course, that could mean something for us. But then I mean, Russian invasion Ukraine or attack on Ukraine, it's not having a big impact on us, and we do not depend on energy much, and we do not -- so I have a hard time to actually come up with something, to be honest. There is no COVID anymore that could shut down the factory. So I think we are fairly safe. Again, one never knows. It's still -- I think probably the hardest part is to make it happen -- to keep the people motivated to work as hard as it did in the first half, work overtime and weekend shifts to make it happen. But other than that, I don't know, Prisca...

Stefan, I think maybe to summarize, I think we have a high backlog, which gives us confidence. And then our operations at the moment are running smoothly, which also gives us confidence to do a good job of adding.

And in particular, on the profit side, I think we just [indiscernible] what you pointed out is we're fairly safe.

And the next question comes from Malte Schaumann of Warburg Research.

My first question is on the order intake and the smart mobility business that have been relatively strong in Q1 and H1 last year a bit slower number. Do you see a change in the pattern here changing the trend or is that just the usual movement as you obviously depending on some larger projects?

The second one. There is no major sort of tender or something that we -- at least not more that we missed. Obviously, we do now have to sell through our own channels in the U.S. You are aware of the change their mobility, it takes some time to build up one's own channel. On the other hand, if we are successful in at least by and large, it looks good thus far, so far so good, I would say, which would help us to get higher margins in the future, because then we can also do the service business, the software parts around it and so on and so forth. So -- last year, we still had [indiscernible], as I say, it's a channel with significant orders in the first half, which we do not have this year anymore. That is basically the change in the pattern. It takes time to build it up. It is so far so good. We think it almost will be not as much as we did in the past, obviously, but if we can build this to former glory, then we should even see actually a margin expansion, because of the additional recurring revenue that we would get. I guess that's a major change in the order intake.

Yes. Okay. Then on TRIOPTICS again. I mean I think in the first quarter call, you said that there is a pipeline, a pretty good pipeline, but customers hesitate to place orders due to the situation, environment. Based on the talks you had with customers or the company had with customers, do you see a change in customers move that they are coming closer to -- are there any indications that customers are coming closer to the point to be able to place orders? Or is that visibility still relatively low when a potential uptake might really happen?

It's a bit like running with a rubber band in your bag. Essentially, I'd like to say the same thing that I said at the end of our earnings call Q1, but at the earnings call in Q1, I said we need to see it by summer and now it's summer, and we're still here. And no major change, which is actually not as good. It's another way of saying no change in pipeline, but also no solid orders yet. And we're in the process of following up and not much more closely now to see what is going on and why we couldn't convert the leads into orders, into full models. . I can't give you a clearer number or clearer statement here at this moment, simply because we're still working on that. We were hoping to see all those sort of materializing in Q2 as we communicated. And clearly, it didn't happen. So we still have the pipeline intact, but still have to work on converting those leads into [ firm ] orders.

And maybe the question is a bit too early, but I'll ask it anyway. So do you see sufficient upside in the pipeline in other businesses to potentially offset missing contribution then going into '24 from TRIOPTICS business when the situation would not change until year-end.

Yes, it's a bit too early to say really. For 2023, we're good. In 2024, we have to see.

Yes. Fair enough. Okay. And then my last question is on the general order guidance. I mean you indicated that you might fall a bit short, but last year's level, I think the official guidance is kind of flat. Is that only relating to -- or coming from TRIOPTICS? Or are there other areas that developed slightly below initial expectations?

Basically, across the board, I would say. Yes. also nothing here, is across the board. And again, not -- I mean, it's not -- we're not expecting not like -- well, you put it. It's -- we do believe that it might come in a bit below last year. And it is more or less across the board, and that's what we see at the moment. Okay. There are no further questions?

We have one more question coming from Craig Abbott from Kepler Cheuvreux .

Yes, unfortunately, I had to join the call very late. So if this question may very well have already been asked, I apologize for that. I just -- I got your comments just a few moments ago on the pipeline at TRIOPTICS, in particular. But I just wondered if you could give us a bit of color for your -- all your business lines, in many major business lines in general, but in particular, obviously, your semi optics business. In terms of [indiscernible] from your major customers and in general, how you're seeing the order pipeline looking at the back half of this year and potentially first half of next year, developing whether this has turned marginally more positive, marginally more negative recently? And the second question is, again, you may very well have answered, apologize for that, but I was just wondering if you could give us a brief update on how you see the free cash flow developing across the full year?

So the second one, Prisca, you want to start.

Yes. Thank you for your question. We've briefly talked about it, but let me reiterate. So we are very confident with our guidance of cash conversion rate above 50%. We expect traditionally a second half that is more cash generative than the first half, particularly driven by working capital levels coming down as we are shipping our products. And we better confident with that number.

And that gives the opportunity to actually end the Q&A session with semicon again because I started the call with a particular thing. I did kick it off with a quick sort of reminder for everyone and mentioning the latest news on the TSMC lead consortium with another EUR 10 billion investment in Dresden. And why not ending it with that? I mean it's phenomenal. If you think about it, how much investment there is into new chip factories in our region here in our area. In a few kilometers between Jena is [ Mackenbach ] and Dresden, it's phenomenal. And this new factory from the TSMC led consortium, TSMC, I think it's called is literally throw away from our own place. I mean we can -- you don't need a very strong arm to actually throw a stone from the Jenoptik rooftop to their new place, and that is really a testimony of how strong this industry develops. Yes, driven by geopolitical changes, I mean, we all know that there are tensions in the street of Taiwan, and that results into investments across the globe, but also driven by a fundamental uptake in the digitization of our world. And that makes a huge impact. And therefore, we are grateful to our board as well and our investors, enabling us to invest significant amounts of money and funds into investment into this area, and we believe and we're confident that it's the right thing to do. The Jenoptik is now focusing on organic growth, investment into organic growth, in particular, in this area. And I think, as I say, those news just -- yes, underscores, it is the right thing to invest into this area. We will make a ton of money from that going forward.

Okay. And then maybe one last concluding question, getting back to you real quick to the -- besides TRIOPTICS, which you discussed in detail a moment ago, are any other parts of your business? And I'm also thinking -- I know you don't give a guidance today for '24, but also with a view of looking into '24, are there any other areas besides TRIOPTICS that are causing any potential concerns at the moment?

I raised the laser business, aesthetics and other laser business of us simply because of the fact that some of that is in areas that might get under pressure with the recession at least in slow growth in the German and other economies. I think that's the -- so if you'd ask me what are the major concerns for 2024? I mean, obviously, 2024 is a long way out. We have to see, but I would point towards, yes, TRIOPTICS and a part of our medical business, which is the aesthetic laser business, but it's not huge. I mean we're talking mid-double-digit million figures here. I mean we're not talking hundreds of millions of sales being exposed, but it's also -- but those are the concerns that I would have.

Okay. But possibly at current levels is still okay. I know you're not going to give the precise numbers, but...

We need the orders for TRIOPTICS so that we can turn it into sales and then the profitability will be okay.

And we have now one more question coming from Peter Rothenaicher, Baader Bank.

Yes. Another question on order intake trend. So does this mean also in the semiconductor business that is some slight decline? Or is semiconductor still very stable?

Stable.

Okay. So this in the semicon offers further growth potential in terms of sales for 2024 with an increasing order backlog?

We're just trying to corner here. We're not guiding on this yet, but yes, I think the fair answer would be yes.

Okay. And last question regarding the financial results. So we have seen another deterioration in the second quarter versus the first quarter. Do you think this financial result, we had now minus EUR 4.3 million could be a run rate for the upcoming quarters as well?

Yes. Thank you for the question. I think you could take the half year as a proxy for the run rate for the second year. Yes, so roughly over the second quarter, but I will take the first half.

And now we have no more questions from the audience.

Well, and again, thank you very much for being with us today. It's been a strong first half operationally. Again, to reiterate, we still have a book-to-bill above 1 despite the fact that we do all we can to expand our capacities, and we grew organic sales by almost 13%. Let's see what the second half brings in terms of order intake, but we do not expect any major changes in pattern here. We are very confident on our guidance both in terms of sales and particularly in terms of profitability. So we're very, very confident that we're going to see a very strong 2023. With that again thanks for being with us today.