DGAP-News: Continental Increases Sales Forecast for Current Fiscal Year after Successful Start
- 84
|
DGAP-News: Continental AG / Key word(s): Quarter Results Continental Increases Sales Forecast for Current Fiscal Year after Successful Start Hanover, May 9, 2017. Continental has made a successful start to the new fiscal year. Based on this strong growth, the technology company is raising its sales projection for the year as a whole to more than EUR43.5 billion: "We can look back on a strong first quarter in terms of sales and earnings. Our three Automotive divisions in particular made an important contribution to the pleasing sales growth. For the second quarter, we anticipate a continued strong performance. We are therefore raising our sales projection for the current year by EUR500 million to more than EUR43.5 billion. At the same time, we are aiming to comfortably achieve an adjusted EBIT margin of 10.5 percent for the year as a whole," said Continental Chairman of the Executive Board Dr. Elmar Degenhart on Tuesday at the presentation of the business figures for the first quarter of 2017. In the first quarter of 2017, the international automotive supplier, tire manufacturer and industrial partner boosted its sales by 11.7 percent year-on-year to EUR11 billion. Organic sales growth, i.e. adjusted for changes in the scope of consolidation and exchange rate effects, came to 9.5 percent. At the same time, net income attributable to the shareholders of the parent rose by 2.1 percent to EUR750 million. Earnings per share thus rose to EUR3.75 after EUR3.67 in the same period of the previous year. As at March 31, the operating result (EBIT) had increased by 9.1 percent year-on-year to over EUR1.1 billion. This equates to a margin of 10.3 percent compared with 10.6 percent in the previous year. The adjusted operating result (adjusted EBIT) climbed to just under EUR1.2 billion, representing an increase of 7.0 percent compared with the first quarter of 2016. At 10.7 percent, the adjusted EBIT margin was 0.4 percentage points lower than the level for the first three months of the previous year. This was mainly due to the sharp increase in raw material prices. The Automotive Group increased its sales by 12.4 percent to EUR6.8 billion in the first quarter of the current fiscal year. Adjusted for changes in the scope of consolidation and exchange rates, sales growth came to 11.3 percent. "Demand for our innovative electronics and software solutions for safe, efficient and intelligent driving remains consistently high. Incoming orders from automotive manufacturers worldwide rose to more than EUR9.5 billion in the first quarter. With an adjusted EBIT margin of 8.4 percent, we are also fully on track," said Schäfer. In the Rubber Group, sales climbed by 10.6 percent year-on-year to EUR4.3 billion in the first quarter of 2017. Adjusted for changes in the scope of consolidation and exchange rates, the sales increase came to 6.9 percent. "Strong demand for passenger car and truck tires and for products from ContiTech's Mobile Fluid Systems and Benecke Kaliko Group business units resulted in encouraging growth in our Rubber Group in the first quarter of 2017. At the same time, negative effects from rising raw material prices increased to EUR100 million as expected. The adjusted operating result therefore decreased to 15.1 percent. We also expect to see rising raw material costs in the second quarter. However, their impact on earnings should decrease in the second half of 2017 as a result of the price adjustments already introduced," affirmed CFO Wolfgang Schäfer. Compared with the end of the previous year, Continental reduced its net indebtedness by EUR30 million to a total of just under EUR2.8 billion in the first quarter of 2017. The gearing ratio thus came to 17.6 percent. "Continental has a very solid financial position. Digitalization, electrification and automation - these are the topics driving the radical change in the industries in which we operate. We can act from a position of strength," emphasized CFO Wolfgang Schäfer. Free cash flow after the first three months amounted to EUR133 million and was thus EUR356 million lower than in the previous year. By contrast, free cash flow before acquisitions only decreased by EUR203 million. "The decrease in free cash flow before acquisitions this quarter is a natural consequence of our very strong growth. Key factors here include the increase in working capital and the rise in investments. These investments in new production capacity secure our future growth," explained CFO Wolfgang Schäfer. As at March 31, 2017, Continental had a liquidity buffer of just under EUR5.8 billion, comprising almost EUR1.9 billion in cash and cash equivalents and almost EUR3.9 billion in committed, unutilized credit lines. The negative net interest result totaled EUR84 million in the first three months of 2017. The increase of EUR50 million was chiefly attributable to valuation effects and changes in exchange rates. "At EUR34 million, interest expense resulting from bank borrowings, capital market transactions and other financing instruments was roughly equivalent to the prior-year figure. The major portion related to expense of EUR21 million from issued bonds," said Schäfer. In the first three months of the year, Continental invested a total of EUR503 million in property, plant and equipment, and software. As a result, the capital expenditure ratio amounted to 4.6 percent after 4.0 percent in the comparative period of the previous year. Continental increased its research and development expenses to fund the start of numerous projects. Compared with the first quarter of 2016, this figure went up by 9.0 percent to EUR781 million. This corresponds to a ratio of 7.1 percent of sales after 7.3 percent in the comparative period of the previous year. At the end of the first quarter, Continental had 227,565 employees, which was 7,428 more than at the end of 2016. In addition to the first-time consolidation of the Hornschuch Group, this was primarily due to further increases in production capacity, expansion of sales channels, and increased activities in the field of research and development. Continental develops pioneering technologies and services for sustainable and connected mobility of people and their goods. Founded in 1871, the technology company offers safe, efficient, intelligent and affordable solutions for vehicles, machines, traffic and transport. In 2016, Continental generated sales of EUR40.5 billion and currently employs more than 227,000 people in 56 countries.
Press portal: Video portal: Automated driving:
09.05.2017 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG. |
| Language: | English |
| Company: | Continental AG |
| Vahrenwalder Straße 9 | |
| 30165 Hannover | |
| Germany | |
| Phone: | +49 (0)511 938-1068 |
| Fax: | +49 (0)511 938-1080 |
| E-mail: | [email protected] |
| Internet: | www.conti.de |
| ISIN: | DE0005439004 |
| WKN: | 543900 |
| Indices: | DAX |
| Listed: | Regulated Market in Frankfurt (Prime Standard), Hamburg, Hanover, Stuttgart; Regulated Unofficial Market in Berlin, Dusseldorf, Munich, Tradegate Exchange; Luxemburg, SIX |
| End of News | DGAP News Service |
|
|
571239 09.05.2017
EQS Group is a leading international technology provider for Digital Investor Relations, Corporate Communications and Compliance. More than 8,000 companies worldwide trust EQS’s products and services to securely, efficiently, and simultaneously fulfil complex national and international disclosure and compliance requirements, and to reach stakeholders globally.
