ElringKlinger AG, DE0007856023

ElringKlinger AG, DE0007856023

07.11.2017 - 07:33:50

ElringKlinger records strong revenue growth in third quarter of 2017

ElringKlinger records strong revenue growth in third quarter of 2017

- Sizeable delivery schedule requests by customers prompt organic revenue growth of 10% in third quarter and 9% in financial year to date

- EBIT before purchase price allocation rises by EUR 2.2 million or 7% year on year to EUR 34.8 million in third quarter

- Schuldscheindarlehen covering EUR 200 million is issued in mid-July for the first time

- Revenue and earnings guidance for 2017 confirmed

Dettingen/Erms (Germany), November 7, 2017 +++ The ElringKlinger Group continued to see its business develop during the third quarter of 2017: revenue improved by 7.9% year on year to EUR 403.6 million and earnings (EBIT before purchase price allocation) by 6.7% to EUR 34.8 million. Due to the appreciation of the euro, currency effects - particularly relating to the Chinese yuan, US dollar, and Swiss franc - diluted revenue by EUR 10.9 million or 2.9%. At the same time, hofer powertrain products GmbH, which has been fully consolidated since February 2017, contributed EUR 1.4 million or 0.4% to revenue. As a result, organic growth stood at EUR 38.9 million or 10.4%.

The Group's substantial growth in revenue was driven primarily by a wide range of global product rollouts as well as by sizeable requests by customers in the NAFTA region for the delivery of components as part of their production scheduling. In fact, the American markets in general represent a strong growth region for ElringKlinger at present. In the NAFTA region alone the Group recorded revenue growth of 16.0% in the quarter just ended, while sales in South America expanded by an equally buoyant 14.3%. Group revenue growth in the Asia-Pacific region was slightly less pronounced at 6.1% but nevertheless perceptively strong. At 6.8% (Germany) and 4.0% (Rest of Europe), revenue generated in Europe also expanded at a significant rate.

"In addition to showing strong revenue growth, the Group's figures for the third quarter also point to an improvement in our performance at an operational level," says CEO Dr. Stefan Wolf. Despite the rise in commodity prices over the course of the year, ElringKlinger's gross profit margin rose to 25.7 (25.0)% in the third quarter and to as much as 25.9 (25.1)% in the first nine months. However, this positive performance was dampened in part by higher selling costs attributable to additional expenditure at sites having to respond to sizeable requests from customers as part of their production scheduling. In total, EBIT (before purchase price allocation) amounted to EUR 34.8 (32.6) million in the third quarter and EUR 111.1 (100.8) million in the first nine months, which corresponds to a margin of 8.6 (8.7)% and 8.9 (8.8)% respectively.

Similar to the situation in the second quarter, the strength of the euro led to exchange differences, the net result of which increased finance costs by EUR 4.2 (0.0) million. Additionally, higher income tax expenses of EUR 8.7 (7.8) million reduced earnings per share by 5 cents to EUR 0.25 (0.30) in the third quarter. In the first nine months, however, earnings per share rose slightly to EUR 0.94 (0.93).

In July 2017, ElringKlinger successfully issued a Schuldscheindarlehen (loan granted to the company against a form of promissory note) for the first time in its corporate history. The placement was heavily oversubscribed, as a result of which the volume originally planned by the company was doubled to EUR 200 million. With an average fixed interest rate of 1.23% and maturities of 5, 7, and 10 years, the Group secured attractive terms for the purpose of refinancing existing liabilities while also optimizing its maturity structure.

The Management Board has reaffirmed its guidance for sales and earnings in 2017. Having outpaced the expansion of global vehicle production by around 6 percentage points in the first nine months on the basis of organic revenue growth, ElringKlinger's market outlook for the fourth quarter is slightly more restrained. Against the backdrop of differing projections for the respective regions of the world, the Group remains confident that it can exceed the global market growth rate by 2 to 4 percentage points on the basis of organic growth in sales.

Assuming that the fourth quarter does not produce any macroeconomic turbulence, e.g., due to an escalation of the conflict in North Korea, and that the situation in Catalonia is not exacerbated, e.g., in the form of a general strike, the Group continues to anticipate that it will improve its operating result (EBIT before purchase price allocation) and achieve an EBIT margin (before purchase price allocation) of around 9 to 10% in the year as a whole.

For further information, please contact: ElringKlinger AG Dr. Jens Winter Investor Relations / Corporate PR Max-Eyth-Straße 2 D-72581 Dettingen/Erms Phone: +49 7123 724-88335 Fax: +49 7123 724-85 8335 E-mail: jens.winter@elringklinger.com

EUR million 9M 2017 9M 2016 ???? ? abs. ?????? rel. Q3 2017 Q3 2016 ???? ? abs. ?????? rel. Order intake 1,288.6 1,248.9 +39.7 +3.2% 381.0 383.7 -2.7 -0.7% Order backlog 976.5 894.7 +81.8 +9.1% 976.5 894.7 +81.8 +9.1% Revenue 1,244.7 1,150.3 +94.4 +8.2% 403.6 374.2 +29.4 +7.9% of which FX effects     -11.8 -1.0%     -10.9 -2.9% of which acquisitions     +7.3 +0.6%     +1.4 +0.4% of which organic     +98.9 +8.6%     +38.9 +10.4% EBITDA 182.5 166.8 +15.7 +9.4% 59.4 55.1 +4.3 +7.8% EBIT before purchase price allocation 111.1 100.8 +10.3 +10.2% 34.8 32.6 +2.2 +6.7% EBIT margin before purchase price allocation (in %) 8.9 8.8 +0.1pp - 8.6 8.7 -0.1pp - Purchase price allocation 3.5 3.6 -0.1 - 0.9 1.4 -0.5 - EBIT 107.7 97.2 +10.5 +10.8% 33.9 31.2 +2.7 +8.7% Net finance cost -19.2 -12.5 -6.7 - -8.0 -3.6 -4.4 - EBT 88.4 84.7 +3.7 +4.4% 25.9 27.6 -1.7 -6.2% Taxes on income 25.9 23.4 +2.5 +10.7% 8.7 7.8 +0.9 +11.5% Effective tax rate (in %) 29.3 27.6 +1.7pp - 33.7 28.2 +5.5pp - Net income (after non-controlling interests) 59.6 58.8 +0.8 +1.4% 16.1 19.0 -2.9 -15.3% Earnings per share (in EUR) 0.94 0.93 +0.01 +1.1% 0.25 0.30 -0.05 -16.7% Investments (in property, plant, and equipment) 114.1 116.6 -2.5 -2.1% 42.1 43.0 -0.9 -2.1% Operating free cash flow -53.3 -3.9 -49.4 <-100.0% -31.5 1.8 -33.3 <-100.0% Net working capital 595.7 541.0 +54.7 +10.1%         Equity ratio (in %) 44.1 46.9 -2.8pp -         Net financial liabilities 644.4 528.9 +115.5 +21.8%         Employees (as of Sept. 30) 9,376 8,433 +943 +11.2%          

About ElringKlinger AG As an automotive supplier, ElringKlinger has become a trusted partner to vehicle manufacturers - with a firm commitment to shaping the future of mobility. Be it optimized combustion engines, high-performance hybrids, or environmentally-friendly battery and fuel cell technology, ElringKlinger provides innovative solutions for all types of drive systems. ElringKlinger's lightweighting concepts help to reduce the overall weight of vehicles. As a result, vehicles powered by combustion engines consume less fuel and emit less CO2, while those equipped with alternative propulsion systems benefit from an extended range. In response to increasingly complex combustion engine technology, the Group also continues to make refinements with regard to gaskets in order to meet the highest possible standards. Additional solutions include thermal and acoustic shielding components as well as particulate filters and end-to-end exhaust gas purification systems for engines used in stationary and mobile applications. The Group's portfolio is complemented by products made of the high-performance plastic PTFE which are also marketed to industries beyond the automotive sector. These efforts are supported by a dedicated workforce of more than 9,300 people at 49 ElringKlinger Group locations around the globe.

Disclaimer This release contains forward-looking statements. These statements are based on expectations, market evaluations and forecasts by the Management Board and on information currently available to them. In particular, the forward-looking statements shall not be interpreted as a guarantee that the future events and results to which they refer will actually materialize. Whilst the Management Board is confident that the statements as well as the opinions and expectations on which they are based are realistic, the aforementioned statements rely on assumptions that may conceivably prove to be incorrect. Future results and circumstances depend on a multitude of factors, risks and imponderables that can alter the expectations and judgments that have been expressed. These factors include, for example, changes to the general economic and business situation, variations of exchange rates and interest rates, poor acceptance of new products and services, and changes to business strategy.

07.11.2017 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.The issuer is solely responsible for the content of this announcement.The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.de

Language: English Company: ElringKlinger AG Max-Eyth-Straße 2 72581 Dettingen/Erms

Germany Phone: 071 23 / 724-0 Fax: 071 23 / 724-9006 E-mail: jens.winter@elringklinger.com Internet: www.elringklinger.de ISIN: DE0007856023 WKN: 785602 Indices: SDAX Listed: Regulated Market in Frankfurt (Prime Standard), Stuttgart; Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover, Munich, Tradegate Exchange   End of News DGAP News Service

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@ dgap.de

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