EANS-Adhoc: ams AG / ams reports second quarter results with revenues in upper half of guidance range reflecting demanding market environment; third quarter expected revenues show sequential growth at

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Financial Figures/Balance Sheet/6-month report
25.07.2016

Key financial data for the second quarter and first half 2016

Premstaetten, Austria (25 July 2016) - ams (SIX: AMS), a leading
worldwide manufacturer of high performance sensor and analog
solutions, reports second quarter 2016 revenues in the upper half of
its guidance range which reflects the demanding market environment.
For the third quarter 2016, ams expects sequential revenue growth to
EUR 146-153 million at an improved operating margin compared to the
second quarter. ams completed the acquisition of CCMOSS in the second
quarter creating the global technology leader in gas and infrared
sensing and additionally concluded a smaller acquisition in color and
spectral sensing focused on industrial and medical markets.

Second quarter group revenues were EUR 132.4 million, down 4%
sequentially compared to the first quarter and decreasing 22% from
EUR 169.5 million in the same quarter 2015. Group revenues for the
first half of 2016 were EUR 269.6 million, down 17% compared to EUR
322.9 million recorded in the first half of 2015. On a constant
currency basis, second quarter revenues were 20% lower compared to
the second quarter last year with first half revenues 16% lower
compared to the first half of 2015.

In the second quarter, adjusted gross margin (excluding
acquisition-related and share-based compensation costs) remained high
at 56% with IFRS reported gross margin (including acquisition-related
and share-based compensation costs) at 53%, compared to 56% and 54%
respectively, in the same quarter 2015. In the first half of 2016,
adjusted gross margin (excluding acquisition-related and share-based
compensation costs) stood at 57% and IFRS reported gross margin
(including acquisition-related and share-based compensation costs) at
54%, compared to 56% and 54% respectively, in the first half of 2015.

The adjusted result from operations (EBIT) (excluding
acquisition-related and share-based compensation costs) for the
second quarter was EUR 24.4 million or 18% of revenues in line with
previous expectations, decreasing from EUR 49.0 million in the same
period 2015. The IFRS reported result from operations (EBIT)
(including acquisition-related and share-based compensation costs)
for the second quarter was EUR 16.7 million or 13% of revenues, down
from EUR 44.6 million in the same period 2015. This expected decrease
reflects negative operational leverage effects from lower revenues as
well as a higher run rate of R&D expenses for future programs. For
the first half of 2016, the adjusted EBIT (excluding
acquisition-related and share-based compensation costs) was EUR 52.6
million, down from EUR 92.0 million in the same period 2015, and the
IFRS reported EBIT (including acquisition-related and share-based
compensation costs) was EUR 36.4 million, down from EUR 82.8 million
in the first half year 2015.

The net result for the second quarter was EUR 19.6 million compared
to EUR 41.8 million in the same period last year. Basic and diluted
earnings per share were CHF 0.32/0.31 or EUR 0.29/0.28 based on
68,085,043/70,016,054 shares (basic/diluted; weighted average)
compared to CHF 0.63/0.61 or EUR 0.61/0.58 for the second quarter
2015 based on 68,948,844/71,639,611 shares (basic/diluted; weighted
average). The net profit for the first half year 2016 was EUR 33.2
million, equivalent to CHF 0.53/0.52 or EUR 0.49/0.47 per share
(basic/diluted) based on 68,321,871/70,388,158 shares (basic/diluted;
weighted average), compared to EUR 84.0 million, i.e. CHF 1.28/1.23
or EUR 1.22/1.17 per share (basic/diluted) based on
68,792,636/71,560,877 shares (basic/diluted; weighted average), for
the same period last year.

Operating cash flow for the second quarter was EUR 7.3 million
compared to EUR 33.7 million in the second quarter last year, while
operating cash flow for the first half was EUR 14.8 million compared
to EUR 72.3 million in the first half year 2015. Total backlog on
June 30, 2016 (excluding consignment stock agreements) was EUR 146.6
million compared to EUR 126.2 million at the end of the first quarter
and EUR 133.3 million on June 30, 2015.

ams' business performed to expectations in a more demanding market
environment in the second quarter and first half of 2016,
particularly in the consumer and smartphone markets. ams' results
demonstrate the advantages of its model and the attractiveness of the
company's balanced portfolio of consumer and non-consumer businesses.

ams' consumer and communications business showed a solid performance
in the second quarter and first half despite a challenging situation
in the consumer market which continued in the second quarter. The
development of the business was again driven by ams' range of high
performance light sensor solutions. Run rates for ams' portfolio of
intelligent light sensors at leading consumer and smartphone OEMs
remained high but were in total lower year-on-year, in line with
expectations. This included ambient light sensing solutions,
combination modules, and highly-integrated multi-function modules for
successful mobile device platforms.

ams is seeing traction for its next generation of mobile device light
sensors with smaller volume shipments already underway. Other product
lines that ams ships into major device vendors' products continued to
support the performance of the company's consumer business. ams'
audio business performed well in the first half of the year and ams
has identified significant opportunities for its ANC noise
cancellation solution targeting high volume in-box smartphone
accessories.

ams' industrial, medical, and automotive businesses performed to
expectations in the second quarter and first half. ams is a key
supplier to a broad base of industrial OEMs globally where ams
enables a wide range of high value industrial sensor applications
through its differentiated sensor and sensor interface solutions.
Demand patterns in some of ams' industrial end markets appear less
consistent as customers experience end market and macroeconomic
uncertainty. At the same time, environmental sensor design-in efforts
remain on track.

ams' medical business again recorded attractive results driven by
digital imaging sensor solutions for advanced computed tomography
(CT), digital X-ray, and mammography where ams offers diagnostic
benefits to global OEMs. Focused on differentiated sensor and sensor
interface solutions, ams' automotive business continued to perform to
expectations in the second quarter. ams' automotive sensor and analog
expertise aligns with major automotive trends and supports
sensor-driven applications including advanced driver assistance,
position sensing, and level and chassis control. ams' specialty
analog foundry business also contributed attractively to the
company's results in the first half.

In the second quarter, ams completed the acquisition of Cambridge
CMOS Sensors Ltd (CCMOSS), the technology leader in micro hotplate
structures for gas and infrared sensing, which makes ams the clear
leader in gas and infrared sensor technology worldwide. CCMOSS' gas
sensing MEMS structures on CMOS wafers allow the creation of complete
monolithically integrated CMOS sensor ICs that offer high
cost-efficiency, low power consumption, small footprint and the
ability to integrate additional sensor modalities like relative
humidity, temperature, and pressure. CCMOSS' hotplate expertise is
highly synergetic with ams' technology leadership in MOX gas sensing
materials to detect gases like CO, NOx, and VOCs for volume
applications in the automotive, industrial, medical, and consumer
markets.

CCMOSS additionally offers industry-leading IR technology comprising
high performance IR radiation sources and detectors. Fully
complementary to ams' spectral sensing strategy for next generation
optical sensor technologies, this portfolio enables miniaturized
sensor implementations and efficient integration for applications
including CO2 gas sensing and human presence detection. CCMOSS, which
was founded in 2008 and is located in Cambridge, UK, with 33
employees, strongly enhances ams' portfolio of products and
technologies for the environmental sensor market and creates
substantial growth opportunities in the coming years.

ams also concluded a smaller strategic transaction recently acquiring
the color and spectral sensing systems specialist MAZeT GmbH for an
undisclosed amount in cash. Focused on industrial and medical
applications, MAZeT offers very strong system and application
know-how in advanced color and spectral sensing and outstanding
optical engineering expertise. MAZeT's capabilities include IC and
filter design as well as hardware and software system development
with current applications including airplane interior lighting,
agricultural sensors, and medical skin lesion analysis. The company
also has a legacy business acting as module supplier to its previous
industrial shareholders. Based in Jena, Germany, which is a global
center of excellence in optical technologies, MAZeT is profitable and
has around 80 employees. The addition of MAZeT complements ams'
existing strengths in emerging optical sensor technologies and
creates exciting new product and application opportunities for
spectral sensing in the automotive, industrial, and medical end
markets.

In operations, ams is realizing further accelerated investments into
optical filter deposition equipment to prepare for the expected
customer uptake of latest generation light sensor products and is
implementing investments for other equipment to support upcoming
revenue opportunities from its pipeline. Based on current
information, total capital expenditures for 2016 are now expected
above EUR 80 million to support these capacity needs.

For the third quarter 2016, ams sees positive momentum in its
consumer business resulting in quarter-on-quarter group revenue
growth while demand and macroeconomic uncertainties in other end
markets continue. Based on available information and a current
USD/EUR exchange rate of 1.10, ams expects third quarter revenues to
grow sequentially to EUR 146-153 million. At the same time, ams
anticipates attractive gross margin profitability to continue in the
third quarter. Adjusted gross margin (excluding acquisition-based and
share-based compensation costs) is expected at a stable or slightly
lower level than for the second quarter reflecting the expected
business mix. The adjusted operating margin for the third quarter
(excluding acquisition-based and share-based compensation costs) is
expected to show a sequential improvement to around 18-20%.

Particularly looking towards 2017 and beyond, ams confirms its strong
and expanded revenue and development pipeline which fully supports
ams' growth plans for the coming years, based on available
information.

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about ams

ams is a global leader in the design and manufacture of advanced
sensor solutions and analog ICs. Our mission is to shape the world
with sensor solutions by providing a seamless interface between
humans and technology.

ams' high-performance analog products drive applications requiring
extreme precision, dynamic range, sensitivity, and ultra-low power
consumption. Products include sensors, sensor interfaces, power
management, and wireless ICs for consumer, communications,
industrial, medical, and automotive markets.

With headquarters in Austria, ams employs over 2,100 people globally
and serves more than 8,000 customers worldwide. ams is listed on the
SIX Swiss stock exchange (ticker symbol: AMS). More information about
ams can be found at www.ams.com

Further inquiry note:
Moritz M. Gmeiner
Senior Director Investor Relations
Tel: +43 3136 500-31211
Fax: +43 3136 500-931211
Email: investor@ams.com

end of announcement euro adhoc
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issuer: ams AG
Tobelbader Strasse 30
A-8141 Premstaetten
phone: +43 3136 500-0
FAX: +43 3136 500-931211
mail: investor@ams.com
WWW: www.ams.com
sector: Technology
ISIN: AT0000A18XM4
indexes:
stockmarkets: official dealing: SIX Swiss Exchange
language: English