- NanoFilm reported 3Q23 revenue of S$55m (-19% y-o-y, vs S$73m in 1H23). 9M23 revenue is in line with our expectation, forming 80% of our full-year estimate. The operating environment for 3Q23 remains challenging due to weaker consumer sentiment, with expected market volatility in 4Q23.
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- We trim our 2023 and 2024 earnings forecast for NanoFilm by 98% and 34% respectively. Reduce target price for NanoFilm by 34% to S$0.66.
- Downgrade NanoFilm to SELL on a more challenging mid-term outlook.
9M23 revenue in line, profitability achieved in 3Q23 due to better gross margin and cost management.
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- 3Q23 revenue was S$55m (-19% y-o-y, vs S$73m in 1H23), which means that Nanofilm has achieved profitability vs an S$8m loss in 1H23.
- Gross margin improved to above 40% in 3Q23 vs 32% in 1H23 due to ongoing efforts in cost management. This improvement occurred despite a 19% y-o-y decline in revenue. Also, operating expenses dropped by 10% y-o-y in 3Q23.
The operating environment for 3Q23 continued to be challenging.
- Read more at SGinvestors.io.
