Exyte benefits from a lack of chips: factory also in Germany

In 2017 the company had sales of 2.5 billion euros. In the Corona year 2020 it was already 4.1 billion euros. In addition, a record result of 213 million euros was achieved. Regarding the failed IPO, the top manager says today: “In 2018, we also had the goals and visions, but no evidence.” At that time it looked as if the former Linde boss had only come to sell the company on the stock exchange and then to go again. It’s still there and will stay longer. “I have just extended my contract,” Büchele confides in the Handelsblatt.

Exyte is currently building the world’s largest chip factory in Ireland and the first large battery cell factory in Germany.

Read the entire interview here:

Mr. Büchele, over four years ago you came as a manager with experience at DAX companies such as Linde and BASF to the small specialist for the construction of cleanrooms for your circumstances. You were supposed to go public three years ago. Shortly beforehand, however, the venture was canceled. How do you recover from such a blow?
Our strategy and our stock market story was the same as today, only nobody believed us back then. In the meantime, we’ve delivered what we promised in 2018.

It also looked as if the owner only brought it as a figurehead, first to prettify the company and then to silver it.
That was never the plan. Exyte is a success story. When we carved out Exyte, we had the same crystal clear strategy as we do today, and we don’t deviate from it a millimeter.

And what would it be?
We are the experts for controlled and regulatory production environments. Under this umbrella we subsume the semiconductor industry with battery technology and photovoltaics, life sciences and specialty chemicals as well as data centers. Unlike in the past, we focus on these three pillars with turnkey plant construction. Today we are the world market leader for the construction of complex high-tech systems.

Are there no more loss-making projects among you?
We just don’t do projects that we can’t. Above all, this means that we no longer do general industrial projects.

But are they comparatively easier than clean rooms for semiconductor production or dry rooms for battery cell factories?
Yes, but we lack the expertise for mass business. The competition is tougher and everything is about price. The margins are significantly smaller, and so the risk for projects to become deficit is greater. We used to build tire plants in India and all sorts of other things. Today that is simply no longer our core business. We cut it all off.

“This year we will grow double-digit”

Out of necessity or on principle?
On principle. I am a strong believer in the core business. You can then focus management much better. Everyone knows what the most important projects in the house are.

And what has changed since 2018?
In 2018 we had an open question: is the strategy working? And one problem: we didn’t have a track record. We have now proven that the strategy is right. We not only delivered everything I said at the time, we even exceeded it.

How is business currently?
In 2017 we had a turnover of 2.5 billion euros. Now we have exceeded our predictions year after year. I am very satisfied with our development.

Can you be more specific?
It is going extremely well, despite Corona we grew by five percent last year, had sales of 4.1 billion euros and a record result of 213 million euros in adjusted EBIT. This year we will grow at a nice double-digit rate. We have a substantial order intake, so that growth for next year is also already secured. The result will also be significantly higher.

Is the organic growth enough?
No, we have now also strengthened ourselves through acquisitions. We bought Critical Process Systems Group (CPS) in the US with 400 employees and $ 150 million in sales. We expect the acquisition announced in August to close this month. We are thus strengthening ourselves in the equipment area for semiconductor production as well as in the life sciences. We are now also building dosing devices for chemicals, coated pipelines for semiconductor machines, and we are going into modularization.

And how does it continue?
CPS is the starting point for further strategic acquisitions. We look around.

Do you have enough funds for this?
Yes, absolutely. We are in ongoing discussions and have submitted our offers. I can’t say more about this at this point.

Then Exyte will soon be listed again?
If there is no stock market collapse next year, the owner will surely think about it again.

What is your main concern?
Getting enough workers fast. We have already hired over 1000 people worldwide this year. Today we have 5800 employees. With the acquisition we are already at over 6000.

You only benefit from the semiconductor boom, which is known to be cyclical …
Yes, but in our opinion it will last for a longer period of time. Electromobility, autonomous driving, artificial intelligence and the networking of things (IoT) require far more semiconductors than there are capacities beyond the current chip crisis. The data centers are also growing in parallel. The switch from the conventional pharmaceutical industry to biopharmaceuticals is the next driver. We are sitting on the central growth trends of the global economy, so to speak. That is why I am very optimistic for the next few years. We are working our way into a position that we would not have been trusted three or four years ago.

Then you would have to hurry with the IPO. Who knows how long the mood in the financial market will last?
The owner certainly has certain values. If he can realize that, he will take the step. If not, he won’t do it. And he gets a decent dividend even without going public.

But three years ago he really wanted to go public.
He has no psychological stress.

That’s not the worst starting position either.
Mr. Stumpf doesn’t have to go public and we deliver our results. The symbiosis fits very well. A family company has more freedom than a listed company when it comes to company acquisitions. In any case, the topic is multi-layered and not just one-dimensional.

But let’s be clear: You are more marketable than in 2018.
We are now fully marketable – in everything from line-up to processes and performance, and we have a rolling long-term strategy that people believe us today. I am sure about that. Today the view in the rearview mirror is correct. In 2018 we also had the goals and visions, but no evidence. We are more stable today, a company that works. We have more options today.

You have been with Exyte since 2017. The company name is derived from the English word for exciting. Are you continuing?
I just renewed my contract.

“We build where the customer wants it”

At the age of 62?
The fallacy at the time was that it was thought that the stump only brought Büchele to bring the company to the stock exchange.

It is also obvious. Wouldn’t be the first time a very experienced manager has been brought in, the company has been bludgeoned on the stock market, and after that both of them are gone, and there is a rude awakening for the shareholders …
But that was never the plan.

Now say …
The plan was that I would develop the company properly for Mr. Stumpf. Our strategy is trivial. We don’t have a country strategy. We build where the customer wants.

Sounds too easy somehow …
I didn’t say it was easy to implement. We are currently building the world’s largest chip factory in Ireland. It’s very demanding and runs like clockwork. Nobody can imitate us so quickly with such a mega-investment.

Why?
That is our expertise, combined with thorough planning with the customer, which we then implement.

Will there be more such mega-projects?
The global political situation is at least such that many companies do not want to rely on Taiwan, as the world’s largest chip location, to retain its independence from mainland China in the coming decades. Therefore there will be new projects in the USA and Europe.

Who is actually expanding the plant in Villach for Infineon?
We too. The mega factory is one of the largest investment projects in the microelectronics industry in Europe and one of the most modern in the world. The factory went into operation three months earlier than initially planned.

What else do you have in store?
We are also building a battery factory in Germany, so far the only major project for cell production in Germany. And we are currently building a large data center in Israel.

Are you still doing well in business?
When I look at our order books, I have no concerns.

Mr. Büchele, thank you very much for the interview.

More: Chip system manufacturer Exyte blows off billions in its IPO.