Kemet Corp (NYSE: KEM) Q4 2020 Earnings Call Transcript

Kemet Corp (KEM) Q4 2020 earnings call dated May. 14, 2020

Corporate Participants:

Gregory C. Thompson — Executive Vice President and Chief Financial Officer

William M. Lowe — Chief Executive Officer and Director

Analysts:

Craig Ellis — B.Riley FBR — Analyst

Unidentified Participant — — Analyst

Presentation:

Operator

Ladies and gentlemen, thank you for standing by, and welcome to the KEMET’s Fourth Quarter Fiscal Year 2020 Earnings Conference Call. [Operator Instructions]

I would now like to hand the conference over to Mr. Greg Thompson. Thank you. Please go ahead, sir.

Gregory C. Thompson — Executive Vice President and Chief Financial Officer

Thank you, Blu, and good morning, everyone. This is Greg Thompson, Executive Vice President and Chief Financial Officer. Welcome to KEMET’s conference call to discuss the financial results for the fourth quarter and year end of fiscal year 2020, which concluded on March 31, 2020. Joining me today on the call is Bill Lowe, Chief Executive Officer.

You might notice our call sounds a little different this quarter. Bill and I are conducting this call from our respective home offices. We have been working from home since mid-March when we closed our corporate headquarter’s office. As a reminder to you, a presentation is available on the KEMET website, which will help you follow along with the financial portion of the presentation.

Before we begin, we would like to advise you that all statements addressing expectations or projections about the future are forward-looking statements. Some of these statements include words such as expects, anticipates, plans, intends, projects and indicates. Although they reflect our current expectations, these statements are not guarantees of future performance and they involve a number of risks, uncertainties and assumptions. Please refer to our 10-Ks, our 10-Qs and our registration filing statements for additional information on the risks and uncertainties.

Now, I will turn the call over to Bill.

William M. Lowe — Chief Executive Officer and Director

Thank you, Greg, and good morning, everyone. In these unprecedented times, our number one priority remains the safety and the well being of our employees, their families and the communities in which we operate. I am very proud of our colleagues around the world who have worked together to quickly implement COVID-19 prevention actions, sooner than required by federal or local governments to keep our employees safe and our facilities operating, while continuing to serve critical infrastructure customers who need our products.

We instituted our first travel ban extending the countries outside of China on January 27 and requiring a 14-day quarantine by any employee that traveled by air in mid-February for business or personal reasons. These early actions and the effort by every manufacturing location and our employees have limited our number of effective employees to only five out of a total of 13,000 employees worldwide. I’m very proud of our local management teams and our employees that have taken extra safety measures outside of work to protect themselves and their families. We remained fully operational as a result.

Let me give you a quick update on the Yageo acquisition. The only remaining approval is the Taiwan investment Authority. Assuming we receive that approval from the investment authority, closing will happen rather quickly in agreement with the merger contract terms. And our current expectation is that the transaction will be able to close some time this summer.

Greg will be going through the financials with you momentarily, but let me first say that KEMET is well positioned with a strong balance sheet as we move through this year. And the fundamental changes that we have made over the years are solidly ingrained in our structure, which continue to support excellent gross margins.

I’ll turn the call over the Greg now to recap the numbers for the quarter, and I’ll come back in a few minutes to discuss operations. Greg?

Gregory C. Thompson — Executive Vice President and Chief Financial Officer

Thank you, Bill. I’m sure you have had a chance to review our press release this morning, so I will highlight only a few key metrics from it. We executed well in the fourth quarter in spite of COVID-19 impacts. As a result, exceeded our expectations, both on the top-line and bottom line, as we achieved above the top-end of our guidance we previously provided.

I will start my review of the numbers on Slide 3 and Slide 4 of the webcast material. Revenue for this quarter was $293.2 million, down 17.6% compared to Q4 last year and down 0.5% sequentially from $294.7 million in the trailing quarter. GAAP net loss was $0.3 million or $0.01 loss per share for the quarter ended March 31, 2020 compared to GAAP net income of $93.4 million or $1.58 per diluted share for the quarter ended March 31, 2019.

This decline in GAAP net income for the quarter ended March 31, 2020 compared to the same quarter last year was mainly due to three things. Lower revenues as we successfully reduced excess inventory in the distribution channel and brought distributor POS and POA into balance. $17.6 million of write-downs of long-lived assets recorded during the quarter, which I will comment on later. And tax expense of $14.6 million for the quarter compared to last year’s fourth quarter tax benefit of $48.7 million.

Q4 tax expense this year was higher due to additional taxable income adjustments related to the impacts of the Tax Reform Act, as the company finalized its tax filings. Last year, fourth quarter tax included a tax benefit of $50.1 million related to the partial release of valuation allowances in the U.S. and Japan. The one-time net income benefit of this release last year was a result of the significant improvements in our profitability of the past several years, and the expectation of that continued profitability in the future.

Our non-GAAP adjusted net income was $22.2 million or $0.37 per diluted share compared to $61.4 million or $1.04 per diluted share in the fourth quarter last year. GAAP gross margin was down compared to last year’s fourth quarter from 35.5% to 31.4% as a result of the lower revenue levels. Non-GAAP gross margin also exceeded our guidance as it came in at 31.9%, down 290 basis points from a year ago and sequentially flat versus the quarter ended December 31, 2019. While gross margins declined due to the lower revenue level, they remained at historically high levels due to the structural changes Bill mentioned, which we have made to our business.

Now on to Slide 5 for the full fiscal year ended December 31 — excuse me, March 31, 2020. Net sales were $1.26 billion compared to $1.38 billion in the prior year, decline of 8.8% year-over-year. GAAP net income was $41.4 million or $0.70 per diluted share compared to GAAP net income of $206.6 million or $3.50 per diluted share for the fiscal year ended March 31, 2019.

On Slide 6, non-GAAP adjusted net income was $137.3 million or $2.31 per diluted share for the fiscal year ended March 31, 2020 compared to non-GAAP adjusted net income of $207.1 million or $3.51 per diluted share for the fiscal year ended March 31, 2019.

During fiscal year 2020, KEMET recorded a net loss on the write-down of long-lived assets of $19.7 million, which was comprised of $18.9 million in impairment charges and $0.8 million in net losses on the sale and disposed long-lived assets. The impairment charges of $18.9 million were primarily due to an $8.9 million impairment of capitalized implementation cost due to the cancellation of certain IT projects and a $6.1 million impairment of the manufacturing building and equipment at film and electrolytic plant in Italy.

Additionally, the company recorded impairment charges of $1.4 million related to underutilized solid capacitor equipment at the Thailand plant, $0.9 million on the film and electrolytic manufacturing building in Granna, Sweden, due to the relocation of operations to Evora, Portugal and $0.8 million related to idled facilities at TOKIN in Japan.

Back on Slide 4, our adjusted EBITDA for the quarter was $54.1 million, down 31.4% from $78.9 million in the fourth quarter last year. The full year adjusted EBITDA margins have steadily increased over the last four fiscal years from 13.9% in March 31, 2017 to 21.3% for the year ending March 31, 2020. The significant improvement continues to show that the structural changes made over the last few years have taken hold in our margin structure and continue to generate robust and sustainable margins.

Non-GAAP income — excuse me, non-GAAP income tax expense for Q4 was $12.5 million compared to Q4 of the last fiscal year of $1.5 million. For the full year, non-GAAP income tax expense was $60.6 million at an effective tax rate of 30.6% compared to the previous year of $10.6 million at an effective tax rate of 4.8%. As previously explained, the low non-GAAP effective tax rate in the prior year was the result of a valuation allowance on the U.S. and certain Japanese deferred tax assets.

As a result of the significant improvements in our profitability, along with our forecast for continued strong profitability going forward, the company made the decision to release the valuation allowance on these deferred tax assets in Q4 of last fiscal year. Accordingly, the non-GAAP effective tax rate has increased to a more normalized rate. We expect this higher effective tax rate to continue in future quarters for both GAAP and non-GAAP results.

Non-GAAP SG&A expenses of $42.2 million were better than our estimated range for the quarter and $5.4 million less than the same quarter last year. The decline was mainly driven by a decrease in incentive compensation due to the lower revenue numbers, our lower level of consulting fees across our various corporate functions and less travel expenses as a result of the company’s self-mandated travel restrictions following the onset of the COVID-19 crisis worldwide.

Now on Slide 8. Capital expenditures during the quarter were $42.2 million compared to $30.8 million in the prior quarter. This coming quarter, we expect to spend in the range of $20 million to $30 million for capital expenditures as we continue our planned capacity expansion to support future growth. We expect our full year capex spend to be in the range of $50 million to $70 million, excluding approximately $15 million of customer-funded capacity expansion related to the customer capacity agreements.

We’ve previously disclosed these capacity agreements to three separate customers, whereby one-third of our expanded ceramics capacity, once completed in fiscal year ’22, will be in effect pre-sold to these three customers. We will of course continue to monitor the market dynamics. These full year estimated capex numbers are based on our current view of needed capital spend to meet current and future demand. And given the uncertainty of the macro environment we live in today, we could revise our capital allocation priorities to adapt to changing market conditions.

Net inventories decreased $19.9 million this quarter to $243.2 million compared to $263.1 million last quarter. This decline is a result of our efforts to adjust our production levels in order to stay in line with current demand. Inventory turns at year end were approximately 3.3 times. We also continue to closely monitor our accounts receivable. At year end, our receivables represented approximately 43 days of sales, which is in our normal range.

Let me say just a few words on liquidity. Cash and cash equivalent was $222.4 million as of March 31, 2020, an increase of $14 million over last quarter ended December 31, 2019. We had very strong cash flow generation this quarter, generating $68.2 million of cash provided by operating activities. Our total debt now stands at approximately $265 million at quarter end, made up of approximately $259 million in Japanese term loan financing at an all-in interest rate below 2.5% annually with semi-annual principal payments of approximately $13 million, and two small loans in Portugal and Japan accounting for the remaining $6 million with all-in rates on those borrowings of 0% and 0.5% respectively. With that low cost debt in our cash levels, net debt now stands at $42.4 million as of year end.

Lastly, I will also mention that we had no borrowings outstanding under our ABL facility. All in all, we believe our balance sheet is very strong and provides us with financial flexibility for the future.

Now, I will turn the call back over to Bill to comment on the business groups. Bill?

William M. Lowe — Chief Executive Officer and Director

Thank you, Greg. So as Greg said, turning to our business groups, we’ll start with solid capacitor. Solid capacitor revenue in Q4 decreased $3.6 million or 1.7% versus the prior quarter and was down $47.5 million or 19.2% versus the same quarter last year. For the full year, revenue was down $49.8 million or 5.3% versus the previous fiscal year.

So looking at the two solid capacitor segment product lines, revenue for the tantalum product line increased $6 million or 5.2% versus the prior quarter, but was down $15.1 million or 11% versus the same quarter last fiscal year. For the full year, revenue was down $67.6 million or 12% versus the previous fiscal year. The sequential quarter-over-quarter improvement was driven primarily by increasing demand for polymer products in Asia for the SSD, automotive and notebook segments. The year-over-year decline was associated with a significant decline in the distribution and EMS channels in the second half of the fiscal year as demand softened from an overheated demand market environment in fiscal ’19, and an excess inventory was also consumed.

Revenue for the ceramic product line decreased $9.6 million or 10.9% versus the prior quarter and was down $32.4 million or 29.3% versus the same quarter last fiscal year. For the full year, revenue increased to $17.8 million or 4.8% versus the previous fiscal year. The first two quarters of the fiscal year were strong, while weakening global demand and excess channel inventory resulted in a second half declined. Inventory in the distribution channel significantly declined in Q4 of the fiscal year, bringing it into a healthier balance.

Most segments declined versus the prior quarter with the exception of military and medical segments, which grew quarter-over-quarter. EMS declined quarter-over-quarter while OEM remained essentially flat. We continue to focus on designing opportunities and expanding product offerings related to larger case size, higher reliability MLCCs used in automotive, military and aerospace, medical and energy-related applications globally. We expect COVID-19 to negatively impact our demand in 2020, but remain confident about the medium and long-term view for MLCC growth in these markets.

Solid capacitor segment year-over-year gross margins increased 120 basis points from 42% to 43.2%. This improvement was driven primarily by improved product mix, favorable MLCC pricing and continued focused on manufacturing cost improvement initiatives in both product lines. Our film and electrolytic business revenue was $44.4 million, an increase of $1.5 million from the prior quarter and $6.1 million lower than the same quarter in the fiscal year 2019.

Fiscal year 2020 revenue was $175.8 million, which was a decrease of approximately 15% compared to last year. Revenues slowed in the distribution channel during the fourth quarter, mostly in the Asia Pacific and EMEA region for this segment. Also, OEM revenues in Europe decreased due to soft automotive market. Gross margins decreased 520 basis points from 9.7% to 4.5%, mostly due to decreased volumes. Our focus for film and electronics continues to be implementing cost reduction and efficiency improvements at our manufacturing sites and releasing new film and electrolytic products, including first-to-market capacitors.

Turning now to magnetic sensors and actuators, the revenue for the quarter came in at $48.4 million, which was a slight increase from $48 million in the previous quarter, but was down $9 million versus the same quarter in fiscal year 2019. Gross margin for the full year was 14.8%, which was a decrease of 400 basis points compared to the fiscal year 2019.

The lower gross margin percentage was mainly driven by lower demand for EMI flex suppression sheets, primarily related to a slowdown in the smartphone market. We are experiencing continued slowdown in demand for piezo actuator products used in semiconductor production equipment, consistent with the overall semiconductor market situation as well as specific consumer-related markets. In addition, we are subject to the global year-over-year slowdown in the global server market.

On the positive side, we continue to see strength and upward momentum in our metal wire business for the medical catheter guidewire market. Additionally, we continue to see nice growth through the distribution channels, we developed and placed more new products into the channel to position and grow our MSA long tail business, particularly new choke coil series named METCOM, which was released to the distribution channel and is expected to make significant inroads into the market for the foreseeable future. I’m very pleased with the pipeline of projects we have in place for the future as we expand MSA’s reach well beyond Japan and Asia in general.

So now for the regions. Europe closed at $64 million, up 4.8% versus the previous quarter and was down 25.6% compared to the same quarter last year. We closed fiscal ’20 with $276.5 million, which was down 12.4% versus fiscal ’19. POS for the quarter came in at $52 million, a 20% increase from the previous quarter and a 14% decrease versus the same quarter year-over-year. We closed fiscal ’20 with a POS of $194.5 million, which was a 13% decrease compared to fiscal ’19.

While our distribution business stayed flat sequentially quarter-over-quarter, our EMS and OEM business increased by 7.8%. We experienced an increase in our green energy business, solar and wind, while the performance from our automotive customers was mixed. For the full fiscal ’20, we saw a stable EMS business and a decline of 8.2% and our OEM business, driven by a weaker automotive market. Our distribution business, underwent a significant correction with a 17.4% decline versus fiscal ’19.

The current macro environment in Europe is hugely influenced today by the COVID-19 pandemic. We’ve been facing countrywide lockdowns in Italy and Spain and voluntary production stoppages in virtually all automotive manufacturers in the region, resulting in significant reductions in production capacity at all automotive suppliers. At the same time though, our industrial and green energy business continues to be more stable as well as our distribution business, which seems to have a supply chain inventory correction behind it. Our outlook for fiscal ’21 is mixed and difficult to predict given the current uncertainty in the macro environment in the region.

Now to the Americas. The Americas quarter, fourth quarter revenue was $59.5 million, which was sequentially down 7.5% versus the previous quarter and down 35.3% compared to the same quarter last year. Fiscal ’20 finished at $296.9 million, which was lower by 12.1% compared to the previous fiscal year. And distribution finished down quarter-over-quarter, 9.4% and year-over-year and 17%. EMS was down quarter-over-quarter 26.3% and down year-over-year 19.2%, while OEM was up quarter-over-quarter 9.1% and also up year-over-year at 10.3%, driven by the medical and defense sectors.

POS finished for the quarter at $55.3, million which is up 3.8% versus the previous quarter and down 8.4% compared to the same quarter last year. POS finished the fiscal year at $218.5 million, which was down 8.5% compared to the previous fiscal year. We continue to see customer plant closures, predominantly in the automotive sector due to COVID-19.

In Asia, quarter four revenue closed at $121.7 million, which was down 4.2% from the previous quarter and 5.7% down compared to the same quarter last year. POS came in at $59.5 million, a decrease of just 2% from the prior quarter and 11% up from the same quarter last year. The market was heavily impacted by the extent of Chinese New Year and the subsequent COVID-19-related lockdown in China. However, some segments responded quickly to the situation and they have been recovering as we came into March.

Our bookings from computer and server customer were very strong as people need to work from home and studying from home. We also saw strong bookings from the 5G customers as China is pushing very hard in this direction, one of the key measures that used to stimulate the market to recover quickly from the COVID-19 impact. In our fourth region, Japan and Korea, quarter four revenues closed at $47.9 million, an increase of 13.3% versus the previous quarter and down 1.6% compared to the same quarter last year. This was due in part to shipment of polymer capacitors for PC and electromagnetic products for medical equipment compared to the last quarter. POS was $6.4 million, up 84.6% from the previous quarter and up 168.9% compared to the same quarter last year. Total revenues for this fiscal year were $178 million, which was down 9% versus last fiscal year.

In the distribution channel, POA for Q4 was 0.4% versus Q3 and down 13% for the fiscal year as compared to fiscal ’19, while POS for fiscal ’20 was down 8% compared to fiscal ’19. And we have the best POS results for fiscal ’20 in Q4, coming in at $173 million, which was up 8% from quarter three. The alignment of POA and POS brought the inventory down by $24 million to $208 million as compared to December ’19 and versus the peak of $251 million in August of 2019.

Now I’m going to turn the call back to Greg to discuss our guidance for the next quarter. Greg?

Gregory C. Thompson — Executive Vice President and Chief Financial Officer

Thank you, Bill. We are providing a forecast with the caveat that it does not include the impact of any unexpected shutdown at one of our facilities related to COVID-19. With that as a backdrop, we expect our first quarter revenue to be in the range of $278 million to $295 million. Compared to the fourth quarter we just finished, on the low-end of that range, it would be down approximately 5% and the high-end of the range would be up approximately 0.6% from the quarter ended March 31, 2020. We are expecting the strong demand for polymer products to continue for the June quarter and provide some offset to the declines driven by the automotive market segment in our other product lines.

We believe our gross margin will continue to be relatively strong and reflect the positive impact from our structural changes, as we anticipate non-GAAP gross margin to be between 28% and 30%. SG&A expenses should be $43 million to $45 million and R&D expenses in the range of $12.5 million to $13.5 million. We expect our first quarter and full year non-GAAP effective tax rate in the range of 35% to 39%.

Now, I’ll turn the call back to Bill for some final remarks.

William M. Lowe — Chief Executive Officer and Director

Thanks, Greg. Needless to say, the last quarter of our fiscal year has been a challenge, but KEMET employees have stepped up to meet that challenge, keeping our manufacturing facilities running. That is important for many reasons. But as an essential business that makes many components for the medical industry, I could spend an hour or more sighting specific situations where we have stepped up our production in emergency situation to provide components for ventilators in the United Kingdom, Germany, the United States and elsewhere to assist our heroes in the medical profession to save lives.

KEMET employees know I’m proud of them. I’d tell them that as often as I can. But I want to repeat it publicly one last time, possibly, on our last public conference call today. To tell them that their dedication to producing quality products really does mean something and does affect lives. All of our employees should be proud of themselves for a job well done. However, the fight is not over, but I know that the KEMET employees will continue to do their best. And because of that, we will have a victory over COVID-19. And KEMET as a combined with Yageo, will continue to be a powerhouse in our industry.

So operator, that’s the end of our formal remarks. We will now take any questions.

Questions and Answers:

Operator

Thank you. [Operator Instructions] Your first question comes from the line of Craig Ellis from B. Riley.

Craig Ellis — B.Riley FBR — Analyst

Yeah. Thanks for taking the question. And Bill and Greg, congratulations on the strong operating performance and financial performance, especially on that closing point that you had Bill regarding helping the medical sector and healthcare workers. The first question I wanted to ask…

William M. Lowe — Chief Executive Officer and Director

Thanks.

Craig Ellis — B.Riley FBR — Analyst

Yeah, you’re welcome. The first question I wanted to ask was just around some of the demand dynamics that you’re seeing in PC, server and medical. It sounds like, work from home and the current crisis has created structural reset in those areas. Is that something that your customers are indicating is more of a near-term dynamic or is the strength there something that you would expect to persist through all of calendar ’20?

William M. Lowe — Chief Executive Officer and Director

That’s a good question. I think our view is that it’s probably pretty strong through September. We know we’re only forecasting our June quarter. But it seems to be from what we’re seeing in orders, it will be possibly strong through at least August, September timeframe. It’s a bit of a — it could be a bit of a bubble as people are working from home, kids are working from home, are schooling from home that didn’t have PCs. If you go online to try to buy a Chromebook or something, the selection is fewer than what you had months ago, same with any other PC that you’re buying or laptop you’re buying.

So it’s partly — it’s filling to the current demand, it’s probably also probably to build, as we get further into this, it’s probably filling the inventory back up a bit so you have availability of various whatever processor speeds and memory and all that that you would have normally a fairly good choice from that is somewhat limited today. But it’s certainly strong for the next three months to four months. Beyond that, it’s hard to read. But clearly, based on our order book, I would say, at least through August, September.

Craig Ellis — B.Riley FBR — Analyst

That’s quite helpful. And then an intermediate term question. I know pre-crisis as the company was managing channel inventory down to normalized levels, and congratulations on successfully getting there in the fiscal fourth quarter. I think we were all thinking that natural end demand was in $320 million level. Like, given the crisis and the impact that it’s had on demand in a number of areas and just given the performance in the quarter and the outlook, is it reasonable to think that the underlying demand has remained somewhere near $290 million to $310 million or how would you guys help us frame the expectation for underlying demand absent some of the channel dynamics that were part of the business for two quarter to three quarter period?

William M. Lowe — Chief Executive Officer and Director

Well, I don’t think we’ve seen the impact of the automotive segment significantly yet. I mean, as you know, where we’re at in the supply chain, I think that the impact of the automotive shutdowns and potentially the consumer purchases will affect us later in the calendar year. I think also that the distribution channel, as usual, when these type of things occur tend to be a concern that someone, not just KEMET, but any one of us that’s supplying them would have a shutdown and would want to put more parts on their shelf.

So I think we were seeing a — have been seeing a fairly reasonable distribution channel stocking, not overstocking, but rather than pulling back, doing a little bit of the opposite just to ensure that they can — they still have parts on their shelf if some one of their suppliers in any category will be shutdown for a period of time, either because of a government mandate or whether it was because of they had a lot of infections inside of a plant. So it’s been some positive things that have occurred that way that I think will slow down and starting to slow down as we get into even this next quarter.

Craig Ellis — B.Riley FBR — Analyst

That’s helpful. And then one last one before I hop in the queue. Very strong gross margin performance in the quarter, we’re 60% above prior cyclical lows. So lots of evidence that there is structural gain there. I think this is the time of year when the company would typically have gone through some of the annual pricing discussions with some of its customers. Any update on what’s trending there? Was that simply disrupted given the dynamics of the crisis as it played out through the first quarter?

William M. Lowe — Chief Executive Officer and Director

No. Actually, from a OEM perspective, most of our contracts are negotiated at the end of the calendar year and then go into effect over a period of months starting in January. So from a negotiation perspective, those were all completed last fall. And of course, when you get in the distribution business, distribution channel, that’s kind of a daily activity from that standpoint unless you’re negotiating some package that’s a long-term package. So the March quarter — really the impact of what was going on globally, didn’t have an impact on those contracts, any significant.

Craig Ellis — B.Riley FBR — Analyst

Thanks, guys. Okay. Bill, Greg, thanks very much, and congratulations not only on the financial performance, but on the performance executing to the Yageo transaction. Thank you.

William M. Lowe — Chief Executive Officer and Director

Great. Thank you.

Gregory C. Thompson — Executive Vice President and Chief Financial Officer

Thanks, Chris.

Operator

Your next question comes from the line of Alvin [Indecipherable] from Stifel.

William M. Lowe — Chief Executive Officer and Director

Hi, Alvin.

Unidentified Participant — — Analyst

Hi, Bill. Thank you so much for taking the call. I’m just in for Matt Sheerin. Yeah. I just wanted to follow-up. Could you be able to give us some color on the book-to-bill by the different end customers by quarter end and the progress you’ve seen quarter-to-date on those bookings so far, because you — just wanted to get an idea, you mentioned there is a beginning of a slowdown starting around this quarter, while starting March. Just some color on that?

William M. Lowe — Chief Executive Officer and Director

Yeah. It’s over — it’s kind of all over the map. And I’m looking to grab my book-to-bill. Hang on. Greg, do you have that — do you have those in front of you?

Gregory C. Thompson — Executive Vice President and Chief Financial Officer

Yeah. So the book-to-bill overall at the end of the year was 1.3. If you break it down by channel, it’s 1.44 for disti [Phonetic], OEM 1.25 and EMS just over 1, 1.03.

Unidentified Participant — — Analyst

And then any color on those — I mean, disti was 1.44 that was pretty high and OEM at 1.25. Do you know the way those were quarter-to-date in April and a little bit into May so far?

Gregory C. Thompson — Executive Vice President and Chief Financial Officer

Yeah. So that was the year end numbers. I think to date, those numbers are holding in pretty well. I think there is, as Bill mentioned related to the automotive portion, there’s definitely signs of weakness there, not immediately for us, but we’re seeing some push-outs, not so many cancellations some cancellations, but definitely some push-outs with automotive plant shutdown. So it is coming down, but we haven’t seen any significant change in it to date.

William M. Lowe — Chief Executive Officer and Director

For the 13 — if you look at the last 13 weeks, if you just use 13 weeks, EMEA — if you just look at the regions, the overall corporate last 13 weeks, so that’s through as of May 7 is about 1.31, that’s the numbers we were giving off. So with EMEA right below 1 and Asia 1.34 now. If we got into the business units, I will say to Greg’s point, the automotive is driving a book-to-bill in ceramics that is well below 1 at the moment. And that’s as expected based upon the number of automotive plants that have shut down throughout the — not just the United States, but in different places around the globe.

Unidentified Participant — — Analyst

I see. Thank you. And in regards to the guide, it was with the caveat that no other factories will be closing. But could you be able to give us some color on some of the risks and the potential, I know it’s hard to predict, but what it would take for additional plant closings? Would it be a confirmed case with an employee would be the contributor? And where the — any type of color on the risk and geography of those factory locations that might have such an impact on forward guide?

William M. Lowe — Chief Executive Officer and Director

Yeah. There’s two different, really there is two different kind of risk. I mean if we have an infection, we do — we have to — we do need to disinfect. And that’s a short — that would be a short shutdown. We’ve been, as I said, I’m very proud of everyone around the globe. We’ve had — we’ve not shut down entire facility for those infections with the exception of a very short period of time to disinfect the area where that employee might of have worked, and we’re doing a great job.

We learned a lot. We have been in China. We were facing this early on before a lot of other companies that are not in China. So we — the lessons learned from China and the team did a great job there. We kind of used the same type of things in the other facilities. So there is that risk. But I think we’ve done a great job on that, and I expect we continue to do a great job on that. And even if there was one, it would be a short shut down.

The other risk is whether a local, federal or state government in a particular country would mandate a closure. But we — I think the risk there is subsiding from the standpoint that first of all in most patients where we produce products we are considered an essential business for the kind of components that we’re making that go into medical products and other types of critical in-products that are considered essential. So we have that ability to have that discussion with the governments and we’ve been successful with that.

And I think as time goes on, not the relax, but I think there is not a knee-jerk reaction from as many locations as there might have been early on. So I think that risk is waning. But those are the two types of risk. But I think, again, as an essential business, it’s really critical for us to keep our employees healthy and safe at work, which we’re doing. And it’s important for our employees to stay, to practice the same protocols when they’re not in our facilities so they don’t bring it into a facility. But there would be a short shutdown. So I’m getting my fingers crossed that we’ve done a great job so far and I believe that we’ll continue to do a great job in all our facilities to keep everything running as we are today.

Unidentified Participant — — Analyst

Thank you very much.

Operator

[Operator Instructions] Craig Ellis from B. Riley.

Craig Ellis — B.Riley FBR — Analyst

Yeah. Thanks for taking the follow-up question. There was some commentary on 5G infrastructure, and I wanted to follow-up there and just to understand what the company was seeing and how significant that might be as you look ahead, not specific guidance, but is that a trend that can be beneficial to sales as we go through this year? And then just talk down, guys, how are you thinking about how 5G impacts the business on a multi-year basis? Again, not looking for specific guidance, just more qualitatively on its impact to your products.

William M. Lowe — Chief Executive Officer and Director

Yeah, I think it — well, I think it has both short-term and long-term impacts. I mean, short-term as we said, we were seeing a bit of a push in China to do more there from a standpoint of keep getting things back to normal. And we’re seeing strong — we’ll see kind of some of the strong on the server perspective as well and some of the edge computing that goes with it. But I think longer term, probably what’s more important to us that would cross more than just one product line is what comes from 5G, which may be a restocking or a redo of some of the things we’re using today, people are using today that are not 5G capable that they would have to buy to from a consumer perspective, etc, and the servers needed for it and those type of things that would ultimately drive even more revenue for KEMET across more than just one product line.

So as we know, it’s somewhat delayed — it’s been somewhat delayed here in the United States. The rollout here has not been forthcoming at the timeframe that everyone expected. But it’s going to get here and we’ll see some benefit from it this year. It’s not going to be so material that we probably call it out as a number in any given quarter, but I think it certainly has an impact.

Craig Ellis — B.Riley FBR — Analyst

That’s great. Thanks, Bill.

William M. Lowe — Chief Executive Officer and Director

All right.

Operator

Presenters, I’m seeing no further questions in the queue. Please continue.

William M. Lowe — Chief Executive Officer and Director

Well, if there’s no further questions, operator, we will wrap up. And Greg and we’ll say thank you to everyone who is on the call. And we may, if we get the last final approval from the Taiwanese Investment Authority, we will be hopefully closing the acquisition with Yageo in summer. So thank you very much. Have a good day.

Operator

[Operator Closing Remarks]