01.08.2013
Continental AG DE0005439004
DGAP-News: Continental Confirms Adjusted EBIT Margin of More Than 10% as Annual Target
DGAP-News: Continental AG / Key word(s): Quarter Results
Continental Confirms Adjusted EBIT Margin of More Than 10% as Annual
Target
01.08.2013 / 08:31
---------------------------------------------------------------------
Press Release
Continental Confirms Adjusted EBIT Margin of More Than 10% as Annual Target
- Consolidated sales climb to over EUR16.5 billion after six months
- Adjusted EBIT of almost EUR1.8 billion, margin of 10.8%
- Sales to rise to around EUR34 billion in 2013
Hanover, August 1, 2013. After the first six months of the year, the
international automotive supplier, tire manufacturer and industry partner
Continental has confirmed its target of achieving an adjusted EBIT margin
of more than 10% for fiscal 2013, with consolidated sales expected to rise
to around EUR34 billion. 'Having gotten off to a difficult start in the
current year, the company saw stronger development - as anticipated - in
the second quarter, particularly in Europe. This should not, however, be
viewed as a turnaround,' explained Chairman of the Executive Board Dr.
Elmar Degenhart. He also confirmed the goal of generating a free cash flow
of more than EUR700 million in the year as a whole.
'Due to our global positioning and the further increase in the number of
vehicles equipped with our products, we expect that consolidated sales will
show stable year-on-year growth in the third quarter, but no further
improvement over the second quarter. The main reason for this is that the
passenger car replacement tire markets are recovering more slowly than
expected, especially in Europe. We expect, moreover, that growth on the
Asian markets and in NAFTA will level off over the rest of the year,' said
Degenhart. 'By contrast, there will be positive effects from the downward
trend in natural and synthetic rubber prices, chiefly attributable to
restrained demand on the tire markets. We expect this to reduce the burden
on the Rubber Group in the order of around
EUR300 million in the current year.'
In the first six months of this year, consolidated sales rose by 0.4%
year-on-year to more than EUR16.5 billion. In the first half of the year,
EBIT was down a slight 1.4% year-on-year to a little over EUR1.6 billion.
This corresponds to a margin of 9.8% after 10.0% in the previous year. At
almost EUR1.8 billion, adjusted EBIT in the first half of the year was 4.2%
lower than in the same period of the previous year. In the second quarter,
it already topped the previous year's figure by 1.5%. The adjusted EBIT
margin was 10.8%, close to the figure of 11.2% after the first six months
of 2012.
Net income attributable to the shareholders of the parent increased by
13.8% in the first six months to over EUR1.1 billion. The non-recurring
positive effect of a recognition of deferred tax assets in the U.S. was a
contributing factor here. Earnings per share thus amounted to EUR5.71 after
EUR5.02 in the same period of the previous year.
There was a further reduction in net indebtedness, which dropped EUR864
million year-on-year to around EUR6 billion. The gearing ratio improved
accordingly to 68.5%, after 87.9% in the previous year. 'Our net
indebtedness has, in the meantime, returned to a level that justifies
rating classification in the investment grade category. We are delighted
that this has now also been confirmed by Fitch, one of the three major
rating agencies,' said Chief Financial Officer Wolfgang Schäfer. Fitch had
reinstated Continental's investment status in July. 'What is more, by
repaying a bond early and issuing a new euro bond, we were recently able to
further improve our financing costs and maturity profile,' underscored
Schäfer. In a further step, the bond issued in September 2010 will be
terminated as of September 16, 2013, ahead of schedule. The date for the
early redemption of two additional bonds issued in October 2010 has not yet
been decided.' At what point in time we choose to exercise this option will
depend on the development of the capital market,' added Schäfer.
Net interest expense increased by around EUR140 million to EUR360 million
in the first half of the year, due mainly to special effects in conjunction
with the measurement of the redemption options contained in the bonds. 'We
have already had to include in our earnings interest expenses of
approximately EUR90 million for the early redemption of our euro bonds. In
the third quarter, we also anticipate a negative effect of around EUR130
million from the adjustment of the carrying amount of the early redemption
options,' commented Schäfer. At the same time, he pointed out that interest
expenses for the bonds will fall significantly as of the fourth quarter of
2013 as a result of the early redemption of the bonds and the improved
conditions for the newly issued bond.
At the end of June 2013, Continental had 174,713 employees. This represents
an increase of more than 5,000 employees compared to the end of 2012 and a
slight rise in comparison to the end of the first quarter.
In the period from January to June of this year, expenditure for research
and development amounted to EUR987 million, equivalent to a ratio of 6% of
sales, after 5.5% in the same period of the previous year. The Continental
Corporation invested a total of EUR867 million in property, plant and
equipment and software in the first half of 2013. The capital expenditure
ratio was thus 5.2%, after 5.0% in the same period of the previous year.
'Our expenditure for research and development and our capital expenditure
are at a high, healthy level. This shows that - particularly in the face of
a challenging economic environment - we are continuing to strengthen the
company's ability to meet future needs', emphasized Degenhart.
In the first six months, the Automotive Group generated sales of more than
EUR10 billion, on par with the previous year. The adjusted margin was 7.8%,
after 8.3% in the same period of the previous year. The Rubber Group
likewise held to the level of the first six months of 2012, generating
sales of more than EUR6.5 billion and achieving an adjusted margin of
16.3%.
With sales of EUR32.7 billion in 2012, Continental is among the leading
automotive suppliers worldwide. As a supplier of brake systems, systems and
components for powertrains and chassis, instrumentation, infotainment
solutions, vehicle electronics, tires and technical elastomers, Continental
contributes to enhanced driving safety and global climate protection.
Continental is also an expert partner in networked automobile
communication. Continental currently has almost 175,000 employees in 46
countries.
Contact for journalists:
Hannes Boekhoff Antje Lewe
Vice President for Media Relations Spokeswoman for Business & Finance
Continental AG Continental AG
Vahrenwalder Str. 9 Vahrenwalder Str. 9
30165 Hanover, Germany 30165 Hanover, Germany
Phone: 0049 511 938-1278 Phone: 0049 511 938-1364
Fax: 0049 511 938-1016 Fax: 0049 511 938-1016
E-mail: corporate-media- E-mail: corporate-media-
[email protected] [email protected]
Related links:
Overview of press releases: www.continental-media.com
Online media database: www.mediacenter.continental-corporation.com
Financial reports: www.continental-ir.com
End of Corporate News
---------------------------------------------------------------------
01.08.2013 Dissemination of a Corporate News, transmitted by DGAP - a
company of EQS Group AG.
The issuer is solely responsible for the content of this announcement.
DGAP's Distribution Services include Regulatory Announcements,
Financial/Corporate News and Press Releases.
Media archive at www.dgap-medientreff.de and www.dgap.de
---------------------------------------------------------------------
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: Regulierter Markt in Frankfurt (Prime Standard), Hamburg,
Hannover, Stuttgart; Freiverkehr in Berlin, Düsseldorf,
München; Terminbörse EUREX; Luxemburg, SIX
End of News DGAP News-Service
---------------------------------------------------------------------
223704 01.08.2013
|
Weitere Ad-hoc und Unternehmensrelevante Mitteilungen zu
Continental AG ISIN: DE0005439004 können Sie bei EQS abrufen
Automobilzulieferer , 543900 , CON , XETR:CON