Osram actions indicate firmer financials for the LED and SSL maker

March 4, 2015
The publicly-traded company plans to pay dividends to shareholders and has restructured debt while the CEO announced a landmark outdoor museum SSL project.

The publicly-traded company plans to pay dividends to shareholders and has restructured debt while the CEO announced a landmark outdoor museum SSL project.

Osram Licht AG has made a number of announcements timed around its Annual Group Meeting (AGM) that seem to indicate that the company is progressing in terms of its financial footing. The company will invest in important new controls technologies, plans to pay a dividend, and will now enjoy more favorable debt financing. Moreover, CEO Olaf Berlien has presented plans for a special LED-based solid-state lighting (SSL) project at the Munich Deutsches Museum that will celebrate the International Year of Light.

Osram has been slowly gaining its footing after the spinout from Siemens that was delayed several times and subsequent establishment as a publicly traded company in mid-2013. Moreover, Osram moved more tentatively into solid-state lighting than other major lighting manufacturers even while its Osram Opto Semiconductors was focused on manufacturing LEDs.

But the latest news is much more positive. "We will drive new technologies and innovations by using selective incentives and investments,” said Berlien to shareholders at the AGM. "I have dedicated a further EUR 10 million ($11.2 million) from the Managing Board’s budget to fund projects like Lightify."

Lightify is Osram's solid-state lighting control platform that spans retrofit lamps, luminaires, and dedicated control products. The company showed a rather large Lightify portfolio earlier this year at the Consumer Electronics Show after launching the platform at Light+Building in 2014.

The company also said that it will pay dividends starting with fiscal year 2014 (FY14). Indeed, the shareholders approved a EUR 0.90 ($1.01) dividend of FY14 that represents payout of half of the company's net income. For FY15 the company intends to pay a similar dividend, but that plan will be subject to shareholder approval early next year.

Restructured finances

Osram also announced it has optimized the structure of its debt and financing based on improved financial strength. The company has extended a EUR 950 million ($1.06 billion) revolving credit line through 2020 with better terms and options for extensions for two additional years. Meanwhile, the company has secured a EUR 200 million ($223.6 million) loan from the European Investment Bank.

"The agreements underline the great confidence of our creditors in Osram's performance," said Klaus Patzak, CFO of OSRAM. "We have thereby secured financial security and flexibility for the coming years which we can use in a selective manner, regardless of the situation on the capital markets."

Deutsches Museum

Separately, the company announced plans to light the façade of the Deutsches Museum of Masterpieces of Science and Technology this coming summer with dynamic, color-changing solid-state lighting. Berlien presented the "Light is more than illumination" theme at an opening ceremony held in Munich for the high-profile project.

The nearby photo is an illustration of what the lighting might look like. Osram subsidiary Clay Paky will provide the solid-state lighting and control products. The project was conceived to take place during the International Year of Light, a designation declared for 2015 by the United Nations.

About the Author

Maury Wright | Editor in Chief

Maury Wright is an electronics engineer turned technology journalist, who has focused specifically on the LED & Lighting industry for the past decade. Wright first wrote for LEDs Magazine as a contractor in 2010, and took over as Editor-in-Chief in 2012. He has broad experience in technology areas ranging from microprocessors to digital media to wireless networks that he gained over 30 years in the trade press. Wright has experience running global editorial operations, such as during his tenure as worldwide editorial director of EDN Magazine, and has been instrumental in launching publication websites going back to the earliest days of the Internet. Wright has won numerous industry awards, including multiple ASBPE national awards for B2B journalism excellence, and has received finalist recognition for LEDs Magazine in the FOLIO Eddie Awards. He received a BS in electrical engineering from Auburn University.