SAF-HOLLAND S.A.: Sales and earnings increase significantly

SAF-HOLLAND S.A.  / Key word(s): Quarter Results

18.11.2010 07:07
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  - Positive momentum in all three business units

  - Sales in the first nine months reach EUR 459.2 million

  - Adjusted EBIT climbs to EUR 26.0 million

  - Forecast: 2010 sales expected to range between EUR 590 million and EUR
    610 million

Luxembourg, November 18, 2010 - SAF-HOLLAND S.A., a leading supplier to the
global truck and trailer industry, has recorded a significant increase in
sales and earnings for the first nine months of the fiscal year. Sales
climbed to EUR 171.7 million (previous year: EUR 103.1 million) in the
third quarter and adjusted EBIT rose to EUR 11.4 million (previous year:
EUR 2.5 million). In the first nine months, the Group generated sales of
EUR 459.2 million, corresponding to growth of 45.1% while adjusted EBIT
increased to EUR 26.0 million (previous year: EUR 1.2 million).

Rudi Ludwig, CEO of SAF-HOLLAND said: 'The SAF-HOLLAND Group made
significant progress in the third quarter. We will even achieve some of our
objectives sooner than expected. Of course, increasing global demand has
helped but, most importantly, the corporate strategy we have adopted has
been affirmed. The restructuring measures of the last two years are clearly
showing their impact. Our Company is lean and strong and we are
internationally positioned with good growth potential in all our core
markets.'

Adjusted result for the period exceeds once again break-even level

All three business units contributed to the sales increase to EUR 459.2
million (previous year: EUR 316.4 million), with the trailer area now
showing increasing recovery compared to the truck area. The Group generated
48.1% of its sales in Europe (previous year: 47.2%), 45.4% in North America
(previous year: 47.3%) and 6.5% in other regions (previous year: 5.5%). The
gross margin improved to 19.1% (previous year: 16.8%) in the period from
January through September. In the third quarter, it was reduced as a result
of increases in material costs, which could not be immediately recovered.
Adjusted EBIT rose to EUR 26.0 million in the nine-month period (previous
year: EUR 1.2 million). At EUR 1.8 million, the accumulated adjusted result
for the period continued the year over year improvement (previous year: EUR
-12.0 million). Adjusted earnings per share improved to EUR 0.09 (previous
year: EUR -0.58).

SAF-HOLLAND is continuing to focus on optimizing inventory management at
its plants for the purpose of improving its cash flow and liquidity
development on an ongoing basis. Cash flow from operating activities before
income tax payments increased to EUR 34.2 million (previous year: EUR 29.1
million) in the reporting period. As a result of increasing demand, the
number of employees increased as of the reporting date of September 30,
2010 to 2,742 including temporary employees (December 31, 2009: 2,331).

Trailer Systems increases operating result

The Trailer Systems business unit almost reached the break-even level in
the third quarter with an adjusted EBIT of EUR -0.1 million. Demand
continued to increase in both North America and Europe. Overall, the
business unit increased its sales in the first nine months by 74.6% to EUR
227.9 million (previous year: EUR 130.5 million), adjusted for exchange
rate effects to EUR 225.3 million. Thanks to the increase in sales in
conjunction with a reduction in costs, the gross margin improved to 5.7%
(previous year: -3.6%). The business unit contributed 49.6% (previous year:
41.2%) to total sales.

Powered Vehicle Systems shows stable upward trend

Sales in the Powered Vehicle Systems business unit were reduced in the
third quarter by the usual July plant closures by major customers in North
America. Despite this seasonal effect, demand in the truck sector continues
to grow. In the first nine months, the business unit's sales increased by
28.2% to EUR 93.6 million (previous year: EUR 73.0 million), adjusted for
exchange rate effects to EUR 90.6 million. The gross margin was at 24.3%
(previous year: 22.1%). Its share of total sales amounted to 20.4%
(previous year: 23.1%).

Aftermarket adds IVECO to its distribution partners

The Aftermarket Business Unit recorded stable sales development in the
third quarter. A cooperative agreement was reached with truck manufacturer
IVECO to sell replacement parts via its distribution network in certain
markets. SAF-HOLLAND will thus strengthen its selling power, particularly
in Italy and North Africa. In total, the business unit generated sales of
EUR 137.7 million (previous year: EUR 112.9 million) in the first nine
months, or EUR 135.0 million when adjusted for exchange rate effects. The
gross margin was at 37.8% (previous year: 37.6%). The business unit
contributed 30.0% (previous year: 35.7%) to total sales.

Successful participation at the IAA Commercial Vehicles trade fair 

SAF-HOLLAND has continued a pioneering role in the development of more
efficient components for the truck and trailer industry. At the largest
international fair for commercial vehicles, the IAA in Hanover, our new
significantly weight-reduced products were very positively received by
manufacturers and end users. A new wheel end system and a new disc brake
with 'SAF-HOLLAND brake caliper' were among the products presented by
SAF-HOLLAND.

2010 forecast: Sales expected to reach between EUR 590 million and  EUR 610
million

Global demand for trucks and trailers continues to increase. SAF-HOLLAND
will benefit from the positive market development as a result of increasing
transport volumes. SAF-HOLLAND therefore expects total sales of between EUR
590 million and EUR 610 million for the current fiscal year. The adjusted
EBIT margin is expected to be between 5.5% and 5.8%. It is the Company's
long-term goal to achieve sales of EUR 1 billion while generating an
adjusted EBIT margin of 10%. With its strong market position, flexible
structure and expansion of its product portfolio, SAF-HOLLAND is well
equipped for its planned growth path.

Note: EBIT was adjusted for the following effects which are not originally
attributable to the operating business: depreciation and amortization
arising from the purchase price allocation as well as restructuring costs.

    

Company Profile: 

With approximately EUR 420 million in sales in 2009 and over 2,000
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 axle and suspension systems, fifth wheels, coupling devices,
kingpins, and landing legs. SAF-HOLLAND customers include the majority of
large truck and trailer producers all over the world. The products are sold
to Original Equipment Manufacturers (OEMs) and Original Equipment Suppliers
(OESs) by means of a global service and distribution network and via
aftermarket channels directly to the end users and service garages.
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. has
been listed in the Prime Standard of the Frankfurt Stock Exchange since
July 2007.



Contact:
SAF-HOLLAND Group GmbH
Barbara Zanzinger
Hauptstraße 26
63856 Bessenbach

Phone +49 6095 301-617
barbara.zanzinger@safholland.de




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Language:     English
Company:      SAF-HOLLAND S.A.
              68-70, boulevard de la Pétrusse
              L-2320 Luxembourg
              Luxemburg
Phone:        +49 6095 301 - 0
Fax:          +49 6095 301 - 260
E-mail:       info@safholland.de
Internet:     www.safholland.com
ISIN:         LU0307018795
WKN:          A0MU70
Listed:       Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr
              in Hamburg, München, Berlin, Düsseldorf, Stuttgart
 
End of Announcement                             DGAP News-Service
 
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