SAF-HOLLAND presents new organizational structure at Company's Capital Markets Day and reaffirms 2020 targets
* Group to be organized regionally as part of its Strategy 2020
* Sales to reach EUR 1.5 billion by 2020
Luxembourg, December 10, 2015 - At the Company's Capital Markets Day 2015
event at the Squaire Conference Center in Frankfurt, Europe's largest
listed commercial vehicle supplier presented its new organizational
structure. The Group's new structure reflects the targets of the 2020
growth strategy presented in May of this year and calls for an even more
powerful and regionally sub-divided Group organization. The Group's
previous structure organized as three business units - Trailer Systems,
Powered Vehicle Systems, and Aftermarket - will now be regionally focused
on the three regions of EMEA/India; Americas consisting of North, Central,
and South America; and APAC/China.
The SAF-HOLLAND Group, which currently derives 90% of sales from the core
markets of Europe and North America, plans to expand Group sales in the
regions outside of today's core markets from their current share of roughly
10% to a total of 30% under Strategy 2020. The focus of this expansion will
be on China and the NEXT-11 and MINT markets.
Strategy 2020 projects sales increase to EUR 1.5 billion
Based on sales of EUR 959.7 million in fiscal year 2014, Group sales are
projected to grow organically to roughly EUR 1,250 million by 2020. This
growth is expected to be augmented by collaborations, joint ventures, and
acquisitions, which should bring Group sales to a total of EUR 1.5 billion.
At the same time the company is very confident that it will achieve an
adjusted EBIT margin at a level of at least 8%. One focal point will be the
rapid penetration of new growth markets and a stronger position in existing
markets. We intend to boost our spare parts business by establishing new
international distribution centers and new sales offices in the markets
already described as well as through targeted acquisitions.
Financial structure for Strategy 2020 already in place
SAF-HOLLAND has already put the necessary financial structure in place to
achieve the targets defined in Strategy 2020 by expanding its credit line
to EUR 156 million and issuing a promissory note loan. The promissory note
was oversubscribed bringing the EUR 125 million issue volume initially
targeted to a total of EUR 200 million. The repayment profile consisting of
5-, 7-, and 10-year maturities are to a large extent at fixed interest
rates.
CEO, Detlef Borghardt emphasized, "Our Strategy 2020 places the focus on
selective megatrends: The strong, global growth of the middle class will
result in higher purchasing power and demand for more goods that will
ultimately need to be transported with trucks and trailers. This is
particularly true in terms of the Asian-Pacific, Middle Eastern and African
markets. We are confident that the emerging markets will continue to drive
growth in the medium-term, particularly the growth of the transportation
sector. We see our technological leadership together with our globally
recognized brands and regional application know-how and production opening
up new and exciting growth opportunities for our products in these markets.
Our new Group structure places us in an even more powerful position to
allow us to take better advantage of added growth areas in new markets and
realize synergies between the former business units."
We also see significant growth in the North American market throughout this
period. The focus of our agenda in terms of products is on the expansion of
our trailer axle and suspension system business for vocational trucks and
specialty vehicles. An important aspect will be on continued weight
reduction in the established markets with the help of newly introduced
weight-optimized axle and suspension systems and components to save fuel
and reduce CO2 emissions.
Large contract from China for air suspension systems
The Company sees excellent opportunities for air suspension systems that
already enjoy a promising market position in the USA and the market for
electric buses in China. SAF-HOLLAND today is also announcing its first
large reference contract for truck suspension systems in China from a
leading truck manufacturer. The contract will begin in 2018 and in the
years that follow will make a peak contribution of over EUR 15 million to
Group sales. Additional projects are currently in negotiation.
Positive sales and earnings trend expected for full year 2015 - Solid
outlook
Despite the market downturns in Brazil, Russia, and Australia, the Company
reaffirmed its full year 2015 financial targets, which were raised slightly
in the second quarter of 2015, leaving the expectation for Group sales at
least at the upper end or slightly above the initial target range of EUR
980 million to EUR 1,035 million (previous year: EUR 959.7 million). Cost
discipline combined with higher production efficiency and satisfactory
capacity utilization in most markets should lead to disproportionately
strong earnings growth. Thus, the Company continues to expect a noticeable
year-over-year rise in profitability and an adjusted EBIT margin at the
lower end of the 9 to 10% range (previous year: 7.4%). Assuming continued
stability in the economies and industries of our core markets, management
reaffirms its forecast for adjusted EBIT for the full year of 2015 of
slightly more than EUR 90 million (previous expectation: around EUR 90
million). Following a strong 2015 fiscal year, management from today's
perspective expects 2016 to become another solid year with stable
operational performance which will pave the way for the successful
execution of Strategy 2020. A detailed outlook for the upcoming 2016 fiscal
year will be presented until the analyst conference on March 11, 2016.
Company profile:
SAF-HOLLAND S.A., located in Luxembourg, is the largest listed supplier to
the commercial vehicle market in Europe. With sales of approximately EUR
960 million in 2014 and more than 3,000 employees, the company is one of
the world's leading manufacturers and suppliers of chassis-related systems
and components primarily for trailers, trucks, buses, and recreational
vehicles. The product range comprises axle and suspension systems, fifth
wheels, kingpins, and landing gear and is marketed under the brands SAF,
HOLLAND, and Neway. SAF-HOLLAND sells its products to Original Equipment
Manufacturers (OEMs) on six continents. The Aftermarket Business Unit sells
spare parts to the Original Equipment Service (OES) of the manufacturers
and to end customers and service centers through its own extensive global
service and distribution network. SAF-HOLLAND is one of the few suppliers
in the truck and trailer industry that is internationally positioned in
almost all markets worldwide.
Contact:
SAF-HOLLAND GmbH
Stephan Haas
Hauptstraße 26
63856 Bessenbach
Phone +49 6095 301-617
Stephan.Haas@safholland.de