March 5 – Israel-listed PCB Technologies (TASE: PCB) reported a significant financial turnaround in its 2024 annual report, with $152.9 million in revenue, marking a 12% year-over-year increase. The company's gross profit surged 76.5% to $27.88 million, while EBITDA soared 134.1% to $18.35 million. Most notably, net profit reached $8.5 million, reversing a $1.4 million net loss from the previous year. Due to its U.S. dollar-based revenue, the company remained largely unaffected by exchange rate fluctuations.

Strong Growth Driven by Defense and Aerospace Sectors

Founded in 1981 and headquartered in Israel, PCB Technologies employs 774 people and operates across three key business segments:

● PCB & IC Substrate Division (Design & Manufacturing)

● IC Packaging Division (Design & Manufacturing)

● PCBA Division (Assembly & Final Products)

In 2024, 50% of the company's revenue came from the defense and aerospace industry, while industrial instruments accounted for 23% and medical devices contributed 27%. The company's stock price surged over 120% last year, largely fueled by its expansion in the defense sector, which now accounts for 62% of revenue in its PCB and IC substrate division. PCB Technologies is currently valued at approximately ILS 633 million ($180 million).

Order Backlog and Future Outlook

As of December 31, 2024, the company reported a total order backlog of $175 million, with:

● PCB orders accounting for 40% ($50.8 million)

● PCBA orders making up 56%

● IC packaging orders contributing 4%

While this represents a decline from $186 million in the previous quarter, it is still over 30% higher than the previous year. This fluctuation has raised concerns about the sustainability of new order growth.

In an interview with Bizportal, CEO Oved Shapira attributed the backlog decline to seasonal factors, stating that new orders are expected to arrive in the coming months. He highlighted several major deals, including a $10 million defense contract signed in December 2023 with an Israeli defense industry client. Additionally, a long-term medical customer is scheduled to conduct an annual large-scale tender in June 2024, and the company is actively competing for several major defense contracts, with results expected to be announced in the coming months.

Shapira emphasized that new contracts will extend into 2026-2027, with an average contract duration of 1-2 years.

Expansion Plans: Increasing PCB Production by 50%

To meet rising demand, PCB Technologies is accelerating its capacity expansion, investing millions of dollars to increase PCB production by 50%—from 250-300 boards per day to 375-400 boards per day.

Shapira stated, "Currently, the average selling price per board is around $1,600 or higher. As production scales up, costs will decrease further. This expansion is expected to deliver full benefits by early 2026."

Production volume will gradually increase throughout 2024, but full implementation will take time. The company aims to keep utilization below 80% to maintain operational flexibility and meet customer demands.

Market Position and Growth Potential

Discussing market share, Shapira noted that if imports from China are included, PCB Technologies holds a 14% market share. However, among clients that do not source from China, its market share reaches nearly 30%.

With the growing demand for military exports, the company expects sustained business expansion in the coming years.