Successful second quarter of 2014 with strong growth in sales and earnings
SAF-HOLLAND: Successful second quarter of 2014 with strong growth in sales
and earnings
* Half-year sales increase by more than 10 percent to EUR 482 million
* Further benefit from positive industry environment
* Adjusted EBIT increases by 22.5 percent to EUR 36.5 million
* Sales and earnings targets for 2014 and 2015 confirmed
Luxembourg, August 7, 2014 - SAF-HOLLAND, the global supplier for the truck
and trailer industry, continues its positive business development. In the
second quarter, Group sales increased to EUR 246.7 million (previous year:
EUR 225.5 million). Half-year sales rose to EUR 482.0 million (previous
year: EUR 435.6 million) representing an increase of 10.7 percent on the
prior-year period. Currency adjusted, sales even increased to EUR 490.8
million in the half-year. The strong expansion of sales volume was linked
to a disproportionately high increase in profitability. Compared with the
same period of the previous year, adjusted EBIT increased in the first six
months by 22.5 percent to EUR 36.5 million (previous year: EUR 29.8
million), while the adjusted EBIT margin rose to 7.6 percent (previous
year: 6.8 percent). Adjusted earnings per share increased to EUR 0.47
(previous year: EUR 0.37) with the number of shares remaining unchanged at
45.4 million shares.
Sales increase of over 15 percent in Europe
The European business made a significant contribution to the substantial
sales increase. In this region, SAF-HOLLAND was able to expand sales by
15.1 percent to EUR 261.2 million (previous year: EUR 227.0 million). The
Company reaped disproportionately large benefits from the favorable
industry environment and further expanded its good position in this core
market. Detlef Borghardt, CEO of SAF-HOLLAND: "The higher demand we
expected in the European trailer market continued into the second quarter
as expected following the strong first quarter." With a share in Group
sales of 54.2 percent (previous year: 52.1 percent), Europe is the most
important sales region for SAF-HOLLAND.
Sales generated in North America in the first six months amounted to EUR
174.9 million (previous year: EUR 175.2 million) and were thus at nearly
the same level as in the prior year period. In the second quarter, it was
possible to beat the prior-year period with sales growth of 3.0 percent to
EUR 91.9 million (previous year: EUR 89.2 million). The North American
sales figures are characterized by unfavorable currency relations in the
translation of the Canadian dollar and the US dollar into the Group
currency euro. Adjusted for these currency effects, SAF-HOLLAND's half-year
sales totaled EUR 182.6 million in the region.
In countries outside of the core markets of Europe and North America, sales
volume amounted to EUR 45.9 million in the first half of the year (previous
year: EUR 33.4 million), which corresponds to growth of 37.4 percent. The
large increase is based on organic growth. Furthermore, the newly added
Corpco Beijing Technology and Development Co., Ltd. (Corpco) has been
included in the scope of consolidation since the first quarter of 2014. The
Chinese company is specialized in suspension systems for buses. Overall,
the emerging markets increased their contribution to Group sales in the
first half of the year to 9.5 percent (previous year: 7.7 percent).
Trailer Systems: Sales and profitability increased
The Trailer Systems Business Unit increased sales in the first six months
by 12.7 percent to EUR 280.8 million (previous year: EUR 249.2 million). As
a result of the substantial increase, the Business Unit's share in Group
sales amounted to 58.2 percent (previous year: 57.2 percent). In Europe,
the sales volume of the business area was supported by the favorable market
environment, as numerous fleet operators had shifted their trailer orders
from the fourth quarter of 2013 to the first quarter of 2014, initially
investing in trucks in view of the Euro 6 standard. In the second quarter
of 2014, the Business Unit was able to continue benefiting from the strong
market. The first half of the year also developed as expected for the
Business Unit in North America. SAF-HOLLAND will gradually utilize the
production capacities added in this region in 2013. The package of measures
introduced in the second half of 2013 to increase the profitability of the
Business Unit showed initial positive effects. The Business Unit's adjusted
EBIT in the first half of the current year showed strong growth to EUR 11.6
million (previous year: EUR 5.1 million), as a result of which the adjusted
EBIT margin more than doubled rising by 2,0 percent to 4.1 percent. The
implementation of the approved measures is proceeding as planned,
especially with regard to the consolidation of the German plants, which is
scheduled for completion in the second half of 2015.
Powered Vehicle Systems: Improved business development in second quarter
The Powered Vehicle Systems Business Unit recorded sales growth to EUR 78.9
million (previous year: EUR 75.5 million) in the first six months. It
should be taken into account that the Business Unit generates the majority
of its sales in North America, and is therefore affected by the unfavorable
currency situation in the translation of dollar sales to the Group currency
euro. Sales of the area in the months from April to June were 16.2 percent
higher than the same figure in the first quarter of 2014. The weaker
business development at the beginning of the year - due to the hard winter
in the USA and the still hesitant awarding of orders from the public sector
following the US budget crises - was well compensated for by the end of the
first half of the year. Adjusted EBIT for the Business Unit totaled EUR 5.3
million (previous year: EUR 6.7 million), corresponding to an adjusted EBIT
margin of 6.7 percent (previous year: 8.9 percent). The earnings figures,
which were weaker than the prior-year period as expected, primarily reflect
structural effects such as the unfavorable customer and product mix in the
first quarter and seasonal influences from the Corpco integration. The
Business Unit generated most of the adjusted EBIT for the half-year in the
second quarter. The development of both sales and earnings confirm the
positive trend seen in the course of business in this area.
Aftermarket: Development with double-digit growth rates
The Aftermarket Business Unit increased its sales in the half-year under
review by 10.3 percent to EUR 122.3 million (previous year: EUR 110.9
million). The segment thereby further secured its orders received. The
positive development was aided by growing success in Mexico and South
America where SAF-HOLLAND decisively expanded spare parts distribution in
2013. Adjusted EBIT for the Business Unit increased to EUR 19.6 million
(previous year: EUR 18.0 million) with an adjusted EBIT margin of 16.0
percent (previous year: 16.2 percent). From a geographical perspective, the
Business Unit is, among other things, strengthening the spare parts
business in the Southeast Asian market this year. Opened in the first half
of the year, the Malaysian Parts Distribution Center plays an important
role here.
Investments in distribution and manufacturing
In the first half of the year, SAF-HOLLAND invested EUR 14.6 million
throughout the Group (previous year: EUR 10.3 million). The costs were
primarily influenced by the acquisition of Corpco and thus above those of
the previous year as planned. Investments in the current financial year
have focused on the modernization and expansion of production facilities at
the primary location in Bessenbach as well as on the expansion of business
activities in Dubai.
Dividend of EUR 0.27 per share for financial year 2013
At the Annual General Meeting of SAF-HOLLAND S.A. on April 24, 2014,
shareholders approved the recommendation of the Board of Directors and
elected to distribute a dividend of EUR 0.27 per share for financial year
2013. The dividend was distributed on April 25, 2014. Wilfried Trepels, CFO
of SAF-HOLLAND: "We are pleased that we were again able to reach the
requirements in the past financial year for the payment of a dividend and
were able to distribute 50 percent of the available net earnings as a
dividend." SAF-HOLLAND's dividend policy calls for 40 to 50 percent of
available net earnings to be distributed as a dividend on a continual basis
when the equity ratio is about 40 percent.
Business development forecast confirmed
With the expectation that the industry environment does not worsen and
overall economic or further negative political developments do not occur,
SAF-HOLLAND confirms the forecast for the full-year as laid out in March of
this year. For financial year 2014, SAF-HOLLAND thereby strives to achieve
Group sales between EUR 920 and 945 million - with adjusted EBIT of
approximately EUR 70 million and a rising adjusted EBIT margin. The
mid-term target introduced in December 2013 also remains unchanged. For
financial year 2015, SAF-HOLLAND thereby continues to plan Group sales of
EUR 980 million to EUR 1.035 billion and an adjusted EBIT margin of 9 to 10
percent.
Notes:
EBIT was adjusted for the following items that are not originally
attributable to the operating business: Depreciation and amortization from
the purchase price allocation and reversals of impairment of intangible
assets from impairment tests as well as restructuring and integration
costs.
The key figures chart included in the press release can be accessed at
http://corporate.safholland.com/de/investor/finanznachrichten/pressemittei
lungen.html.
Company Profile
With sales of approximately EUR 860 million in 2013 and more than 3,000
employees, SAF-HOLLAND S.A. is one of the world's leading manufacturers and
suppliers of premium product systems and components primarily for trailers
as well as trucks, buses and recreational vehicles. The product range
encompasses trailer axle systems and suspension systems, coupling devices,
kingpins, and landing legs, among other things. SAF-HOLLAND sells its
products on six continents to Original Equipment Manufacturers (OEMs) in
the replacement parts market and, in the aftermarket business, to the OEM's
Original Equipment Suppliers (OESs), as well as by means of a global
service and distribution network. SAFHOLLAND also sells its products to end
users and service centers using this network. SAF-HOLLAND has therefore
established itself as one of the few manufacturers in its sector that is
internationally positioned with an extensive product range and a broad
service network. SAF-HOLLAND S.A. is listed in the Prime Standard of the
Frankfurt Stock Exchange and is a component of the SDAX index (ISIN:
LU0307018795).
Contact:
SAF-HOLLAND GmbH
Claudia Hoellen
Hauptstraße 26
63856 Bessenbach
Phone +49 6095 301-617
claudia.hoellensafholland.de