Incap Corporation’s President and CEO Otto Pukk

Incap’s year 2024 got off to a great start, as our revenue grew and profitability improved compared to the previous quarter. We are happy to see the continued growth and especially that the factory in India returned to growth as well. We continued to focus on customer acquisition, explored cross-selling possibilities, and participated actively in trade shows.

Our revenue for the first quarter grew 21% quarter on quarter and was EUR 51.4 million. Excluding sales to our largest customer, our revenue grew 38% year on year. With the sales growth, also our profitability started to grow. Our EBIT for the first quarter was EUR 6.0 million or 11.7% of revenue. The EBIT increased by 62.3% compared to the previous quarter.

To respond to the growth trend, we continued increasing the number of employees at our factories in India. However, the largest customer’s destocking is still ongoing, and we expect it to continue at least to the end of the first half of the year.

In 2023, we expanded our operations to the US market, and we are very pleased with our acquisition there. The integration of Incap US’ operations has continued as planned, the results are very good, and they have also had success in new customer acquisition.

To continue succeeding in the EMS industry, our philosophy is to continuously improve our operations and to keep investing in the latest technology in our factories. In the beginning of the year, we replaced the second SMT production line with advanced SMT machinery at our factory in Slovakia and made some investments at the UK factory as well.

In April, we published our first combined Annual and Sustainability Report and are preparing for reporting in accordance with the CSRD in 2025. We have started the required double materiality analysis and are developing our sustainability programme further. We take a positive view of the tightening legislation related to sustainability reporting, as we believe that uniform rules can develop our industry in an increasingly responsible direction.

Sustainability is an important part of our strategy, and I believe that this work will improve our ability to respond to future opportunities and challenges. We are also happy about being able to support sustainable development in practice. We have for instance in many ways supported young people learning through various technology-related events and donated local schools’ equipment for learning physics and mechatronics.

During the remainder of the year, we will keep investing in our factories, focus on new customer acquisition and increasing sales to existing customers. We will also continue pursuing shareholder value creating M&A transactions, supported with our solid financials.

For 2024, we estimate that our revenue and operating profit will be lower than in 2023. The destocking exercise with our largest customer will impact the revenue and profitability first half of the 2024. However, we estimate our revenue will grow quarter to quarter and our results will improve over the year.

Year 2024 has started well for Incap, and I would like to thank our entire team for doing a great job.