SAF-HOLLAND SE: Scope Hamburg confirms investment grade rating - outlook raised to stable
SAF-HOLLAND: Scope Hamburg confirms investment grade rating - outlook raised to stable
Bessenbach, June 9, 2021. SAF-HOLLAND SE ("SAF-HOLLAND"), one of the world's leading suppliers of trailer and truck components, today published the combined rating report for 2021 from Scope Hamburg GmbH (formerly Euler Hermes Rating GmbH). The report confirms the investment grade rating and sets the outlook from negative to stable.
In its rating, Scope Hamburg particularly emphasizes the sustainable growth prospects from the increasing global transport volumes and the Group's leading market positions in the markets for axle and suspension systems for trailers in the EMEA region and India as well as fifth wheels in the Americas region and the less cyclical, high-margin spare parts business. The global production and service network, the broad customer base and the structural cost reduction and process optimisation measures are also viewed positively.
At the same time, the assessment of the slightly increased business risk reflects the high dependency on the cyclical commercial vehicle sector and the intense competition, which was recently once again briefly exacerbated by the COVID-19 pandemic.
Scope Hamburg rates the financial risk of SAF-HOLLAND as low to moderate, with reference to its high internal financial resources and solid capital structure and financing base.
Inka Koljonen, CFO of SAF-HOLLAND SE says: "Overall, we are very satisfied with the rating. In the past financial year we have impressively demonstrated that we have a resilient business model that generates comfortable margins. The main contributory factors in this regard were the extensive program initiated in September 2019 already to sustainably reduce our selling and administrative expenses, the voluntary waiver of the Management Board and the Supervisory Board of their fixed remuneration, the supplementary collective agreement for the Bessenbach location, salary cuts at the US locations and short-time work at the two German locations in Bessenbach and Singen."
"Furthermore, in terms of financing, we are on a better footing today than we were one year ago. At EUR 371 million (previous year: EUR 243 million) SAF-HOLLAND SE enjoyed a particularly strong gross cash position as at December 31, 2020. The successful placement of our promissory note loan in March 2020 and the very strong operating free cash flow contributed to this. This is particularly attributable to the positive contribution from net working capital management. The Cash-is-King project initiated in April 2020 played a major role in this regard. As a result, it was possible to sustainably reduce overdue receivables in all regions and improve the management of inventories."
SAF-HOLLAND SE, located in Bessenbach, is one of the leading international manufacturers of chassis-related assemblies and components, primarily for trailers and trucks. In addition to axle and suspension systems, the product range includes fifth wheels, coupling systems, kingpins and landing gear, which are sold under the SAF, Holland, Neway, KLL, V.Orlandi and York brands. SAF-HOLLAND supplies original equipment manufacturers (OEM) on six continents. In the Aftermarket business, the Company supplies replacement parts to manufacturers' service networks (OES), wholesalers, and, with the help of distribution centers, to end customers and service centers via an extensive global sales network. With the innovation offensive "SMART STEEL - ENGINEER BUILD CONNECT", SAF-HOLLAND combines mechanics with sensors and electronics and is driving forward the digital networking of commercial vehicles and logistics chains. Around 3,000 committed employees worldwide are already working on the future of the transport industry today. Further information is available at: https://corporate.safholland.com/en
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This press release contains certain future-oriented statements that are based on current assumptions and forecasts made by the management of SAF-HOLLAND SE. Various known and unknown risks, uncertainties and other factors may lead to the actual results, financial position, development or performance of the company deviating considerably from the appraisals specified here. The company assumes no obligation to update future-oriented statements of this nature or adapt them to future events or developments.
This announcement is for information purposes only and does neither constitute an offer to sell, purchase, exchange or transfer any securities nor a solicitation of any offer to sell, purchase, exchange or transfer any securities. The securities referred to herein have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act") and may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act. SAF-HOLLAND SE does not intend to register any securities referred to herein under the Securities Act or with any securities regulatory authority of any state or other jurisdiction in the United States in connection with this announcement.