EANS-Adhoc: ElringKlinger sales up 6% in Q3 2012 - Slight contraction in adjusted EBIT
PR Newswire/euro adhoc/ EANS-Adhoc: ElringKlinger sales up 6% in Q3 2012 - Slight contraction in adjusted EBIT ad-hoc disclosure pursuant to section 15 of the WpHG transmitted by euro adhoc with the aim of a Europe-wide distribution. The issuer is solely responsible for the content of this announcement.
Dettingen/Erms, November 7, 2012 +++ Despite the severe weakness afflicting car markets throughout Western Europe, the ElringKlinger Group managed to drive sales forward by 11.3% to EUR 849.6 (763.2) million in the first nine months of 2012. In the third quarter of 2012, sales revenue grew by 5.8%, reaching EUR 279.8 (264.4) million overall. The Group's year-on-year earnings performance was affected by the high comparative base in 2011. In the third quarter of 2011, ElringKlinger had sold its Ludwigsburg industrial park, posting a one-time gain on disposal of EUR 22.7 million before taxes. As a result, EBIT contracted by 8.3% year on year in the first nine months of 2012, taking the figure to EUR 111.6 (121.7) million. In the third quarter of 2012, EBIT amounted to EUR 36.0 (60.2) million, a slight reduction of 4.0% when eliminating the non-recurring gain on disposal attributable to the same quarter a year ago.
Consolidation of acquired entities contributes to revenue
Forward momentum generated by the ElringKlinger Group throughout the emerging markets and in the United States, coupled with numerous product ramp-ups, proved sufficient when it came to offsetting the effects of anemic demand for new vehicles in Western Europe. The first-time inclusion of the acquired Hug Group, the Hummel-Formen Group as well as former Hug supplier ThaWa in the scope of consolidation of the ElringKlinger Group contributed a total of EUR 18.6 million (EUR 1.7 million in Q3) to Group sales in the first nine months of 2012. These entities had not been included in the scope of consolidation in the nine-month period of 2011 or had only been consolidated on a pro-rata basis. Overall, their contribution to earnings before taxes was in negative territory, at minus EUR 3.4 million (EUR -0.5 million in Q3), primarily due to the earnings performance of the Swiss Hug Group. In the third quarter, the Group recorded organic revenue growth of 5.2%, adjusted for the contributions from first-time consolidation of the acquired entities.
In the first nine months, Hug made a negative contribution of minus EUR 3.6 million (EUR -0.7 million in Q3) to Group earnings before taxes, despite a gradual upturn in its performance. By contrast, the earnings situation of the former Freudenberg companies, which were acquired effective from January 1, 2011, and were thus included in the scope of consolidation in the first nine months of 2011, showed signs of improvement. Having incurred a significant loss in 2011, they contributed EUR 38.5 million to Group sales (EUR 11.5 million in Q3) and EUR 1.0 million (EUR 0.5 million in Q3) to earnings before taxes in the first nine months of 2012 - despite the severe downturn in demand within the French car market.
Slight dip in adjusted EBIT during third quarter
The marked increase in staff costs, particularly within the domestic market, and the surge in raw material prices during the third quarter with regard to key commodity groups such as polymer granules were largely offset by ongoing measures aimed at raising efficiency levels throughout the Group. At +8.9%, the cost of sales incurred in the first nine months of 2012 as a whole increased at a slower rate than sales revenue. The third quarter also saw the cost of sales expand at a less pronounced rate, +3.8%, than sales revenue. Thus, the gross profit margin improved year on year, rising to 28.8% (27.5%).
In the first nine months of the current financial year, ElringKlinger expanded its investments in research and development by EUR 7.7 million. In total, R&D expenditure rose to EUR 44.7 (37.0) million. Correspondingly, the R&D ratio increased to 5.3% (4.8%). Alongside a multitude of new products in the Group's core line of business, investments were mainly directed at the E-Mobility division. The company has recently been able to secure two further serial-production contracts for the manufacture of cell contact systems to be used in a hybrid vehicle developed by a German car maker and in a pure electric car produced by another European auto company. The overall volume of these contracts stands at EUR 9 million. With outlays directed at battery technology, this area generated revenue of EUR 5.2 million in the first nine months of 2012.
The operating result declined by 8.8% to EUR 113.1 (124.0) million in the first nine months. Of this total, an amount of EUR 36.5 (58.0) million was attributable to the third quarter. In contrast, adjusted for the above-mentioned non-recurring gain in the same quarter a year ago, the Group's operating result for the third quarter of 2012 rose by 3.4%. The contribution made by the aforementioned acquisitions, including the former Freudenberg companies, diluted the Group's operating result by minus EUR 2.2 million in the first nine months of 2012 and by minus EUR 0.4 million in the third quarter. In this context, the purchase price allocations gave rise to a negative effect in the first nine months of 2012 that was equivalent to minus EUR 1.8 million (EUR -0.6 million in Q3).
Earnings before interest and taxes (EBIT) - in contrast to the operating result, this indicator includes foreign exchange gains and losses - fell by 8.3% to EUR 111.6 (121.7) million in the first nine months of 2012. Excluding the one-time gain from the sale of the industrial park in the previous year, the Group managed to expand EBIT by 12.7%. Foreign-exchange losses of EUR 0.5 million exerted downward pressure in the third quarter of 2012. Against this backdrop, EBIT stood at EUR 36.0 (60.2) million. Eliminating the one-time gain attributable to the third quarter of the preceding year, EBIT contracted by 4.0% in Q3 2012. The EBIT margin for the third quarter was 12.9%. Excluding the dilution of earnings attributable to the acquisition of the Hug Group, the Hummel-Formen Group and ThaWa GmbH - the latter has already been integrated into ElringKlinger AG - as well as to the Freudenberg companies, which as yet generate lower margins in Group comparison, the ElringKlinger Group recorded an EBIT margin of 14.6% in its core business over the nine-month period.
In the first nine months of 2012, net finance costs were scaled back from EUR 11.6 million to EUR 10.8 million. At EUR 3.6 (0.8) million, net finance costs attributable to the third quarter were higher than in the previous year. This was attributable largely to foreign exchange effects.
The ElringKlinger Group saw its earnings before taxes decline by 9.0% to EUR 102.2 (112.3) million in the first nine months. Excluding the effects of the non-recurring gain from the sale of the industrial park a year ago, the Group managed to raise its earnings before taxes by 14.1%. Adjusted for the aforementioned one-time gain, earnings before taxes posted in the third quarter were down 4.3% to EUR 33.0 (34.5) million. At 26.6% (26.1%), the Group's tax rate for the first nine months remained largely unchanged year on year.
On this basis, the ElringKlinger Group recorded net income after minority interests of EUR 72.7 (80.6) million in this period. In the third quarter, net income after minority interests fell by 43.3% to EUR 23.3 (41.1) million. Excluding the one-time gain of EUR 16.5 million after taxes recorded in the same quarter a year ago, ElringKlinger saw net income after minority interests contract by just 5.3% in the third quarter.
Earnings per share amounted to EUR 1.15 (1.27) in the first nine months of 2012. In the third quarter earnings per share stood at EUR 0.37 (0.65).
Slight increase in order intake during third quarter
Order intake rose by 3.8% to EUR 267.5 (257.8) million in the third quarter of 2012. As at September 30, 2012, order backlog within the ElringKlinger Group as a whole thus stood at a solid EUR 472.8 (440.9) million, up 7.2% on the previous year's figure.
Growth in sales and EBIT, before one-time effects, also targeted for full fiscal year
At present, a further downturn within the automotive markets, particularly in Europe, cannot be ruled out. Overall, ElringKlinger is working on the assumption that global vehicle production will expand at a moderate rate in 2012 as a whole. Against this backdrop, the Group still anticipates that it will be able to raise sales revenue by 5 to 7% in 2012 on an organic basis - depending upon how customer demand develops over the course of the fourth quarter. An additional revenue contribution of approximately EUR 20 million is expected from the consolidation of acquired Hug Engineering AG, the Hummel-Formen Group and former ThaWa GmbH, which in 2012 will be included in the scope of consolidation for a full annual financial period for the first time. In 2011, the Hug Group had been included in the scope of consolidation of the ElringKlinger Group on a pro-rata basis as from May 1, while the Hummel-Formen Group had been included on a pro-rata basis as from October 1.
The EBIT margin of the Group's core business in 2012 will be adversely affected to some extent by the much weaker margins recorded by the acquired entities, the purchase price allocations associated with these acquisitions and the substantial outlays attributable to the E-Mobility division. Despite these effects, ElringKlinger still anticipates that earnings before interest and taxes, adjusted for non-recurring items, will expand at a faster rate than sales revenue. Group EBIT adjusted for non-recurring items is expected to be in a range of EUR 145 to 150 million (EUR 126.0 million in fiscal 2011) in the annual period as a whole.
Further inquiry note: ElringKlinger AG Investor Relations / Corporate Communications Stephan Haas Max-Eyth-Straße 2 72581 Dettingen Fon: +49 (0)7123-724-137 E-Mail:firstname.lastname@example.org
issuer: ElringKlinger AG
D-72581 Dettingen/Erms phone: +49(0)7123 724-0 FAX: +49(0)7123-7249000 mail: email@example.com WWW: http://www.elringklinger.com sector: Automotive Equipment ISIN: DE0007856023 indexes: MDAX, CDAX, Classic All Share, Prime All Share stockmarkets: free trade: Berlin, München, Düsseldorf, regulated dealing:
Stuttgart, regulated dealing/prime standard: Frankfurt language: English
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