DGAP-News: Continental AG / Key word(s): 9-month figures/Interim Report Continental AG: 09.11.2015 / 07:00 --------------------------------------------------------------------- * Net income climbs by 16 percent to EUR2.1 billion after nine months * Sales up 14 percent at over EUR29 billion * Sales projection for 2015 of more than EUR39 billion confirmed * EBIT of EUR3.2 billion after three quarters * Forecast for adjusted EBIT margin raised to more than 11 percent * Outlook for free cash flow before acquisitions increased to more than EUR2 billion Hanover, November 9, 2015. Despite a persistently challenging market environment, the technology corporation Continental remains on track. The company confirmed its sales forecast for 2015 and raised the annual forecast again when it released the business figures for the first nine months of the year. "For the year as a whole, we still anticipate sales of more than EUR39 billion. The outlook for the end of the year makes us optimistic about achieving an adjusted EBIT margin of more than 11 percent, after we had previously anticipated around 11 percent. Based on the positive business performance, we are also raising our outlook for free cash flow before acquisitions from its previous level of at least EUR1.8 billion to more than EUR2 billion," said the chairman of Continental's Executive Board, Dr. Elmar Degenhart. "Overall, we can look back at a solid third quarter in a difficult environment. We compensated for both the slower growth in passenger-car production in China and the decline in industrial business with steady growth in Europe and North America," explained Degenhart. The automotive supplier is also benefiting from a rising proportion of vehicles being equipped with state-of-the-art electronics. Sales of the international automotive supplier, tire manufacturer, and industry partner rose by 14.2 percent year-on-year to EUR29.2 billion in the first three quarters of 2015. Before changes in the scope of consolidation and exchange rate effects, sales rose by 3.3 percent. At the same time, net income attributable to the shareholders of the parent grew by 15.9 percent to EUR2.1 billion. Accordingly, earnings per share rose to EUR10.42 after EUR8.99 in the same period of the previous year. As at September 30, 2015, EBIT increased by 30.6 percent year-on-year to EUR3.2 billion. This equates to an EBIT margin of 10.9 percent after 9.6 percent in the previous year. Adjusted EBIT climbed by 15.6 percent compared to the same period of 2014 to EUR3.4 billion. The adjusted EBIT margin was 12.0 percent after 11.4 percent in the previous year. Free cash flow before acquisitions saw a significant year-on-year increase of EUR473 million to more than EUR1.5 billion. "Despite cash outflows totaling EUR1.2 billion for acquisitions, primarily those of Veyance Technologies and Elektrobit Automotive, free cash flow amounted to EUR316 million after the first nine months of 2015," emphasized CFO Wolfgang Schäfer. As at September 30, 2015, the Continental Corporation's net indebtedness amounted to EUR4.3 billion. This represented a year-on-year increase of EUR370 million. Compared to the end of 2014, net indebtedness was up EUR1.5 billion, chiefly due to the acquisition of Veyance Technologies at the end of January 2015 and the acquisition of Elektrobit Automotive at the start of July 2015. However, the gearing ratio of 33.9 percent at the end of September 2015 was lower than the previous year's figure of 36.2 percent. At the end of the third quarter of 2015, Continental had liquidity reserves totaling EUR5 billion, comprising EUR1.8 billion in cash and cash equivalents and EUR3.2 billion in committed, unutilized credit lines. Compared to the first half of 2015, this represents a EUR1.4 billion decline in liquidity. "The main reasons for this were the early redemption of the U.S. dollar bond in mid-September and the acquisition of Elektrobit Automotive in early July 2015," Schäfer explained. Interest expense decreased by EUR31 million year-on-year to EUR260 million. At EUR217 million, net interest expense in the first nine months of 2015 was almost the same as in the previous year. In the first nine months of 2015, Continental invested EUR1.3 billion in property, plant and equipment, and software. The capital expenditure ratio thus amounted to 4.5 percent after 5.1 percent in the same period of the previous year. Research and development expenses rose by 16.6 percent year-on-year to EUR1.9 billion as at September 30, 2015, corresponding to 6.5 percent of sales after 6.4 percent in the same period of the previous year. As at the end of the third quarter of 2015, the corporation had over 208,000 employees, roughly 19,000 more than at the end of 2014. The number of employees in the Automotive Group rose by more than 6,300 as a result of increased production volumes and the acquisition of Elektrobit Automotive. In the Rubber Group, further expansion of production capacity and sales channels as well as the acquisition of Veyance Technologies by the ContiTech division led to an increase of around 12,600 employees. Compared with the reporting date for the previous year, the number of employees in the corporation was up by a total of approximately 18,800. In the first nine months of this year, the Automotive Group generated sales of EUR17.6 billion. At 8.8 percent, the adjusted EBIT margin was higher than the previous year's level of 8.0 percent. The Rubber Group generated sales of EUR11.7 billion as at September 30, 2015, and improved its adjusted EBIT margin from 17.5 percent in the previous year to 18.3 percent. Continental develops intelligent technologies for transporting people and their goods. As a reliable partner, the international automotive supplier, tire manufacturer, and industrial partner provides sustainable, safe, comfortable, individual, and affordable solutions. In 2014, the corporation generated sales of approximately EUR34.5 billion with its five divisions Chassis & Safety, Interior, Powertrain, Tires, and ContiTech. Continental currently employs more than 208,000 people in 53 countries. Press contact Hannes Boekhoff Vice President, Media Relations Continental AG Phone: +49 511 938-1278 Mobile: +49 170 762 73 26 E-mail: [email protected] Vincent Charles Spokesman, Business & Finance Continental AG Phone: +49 511 938-1364 Mobile: +49 173 314 50 96 E-mail: [email protected] This press release is available in the following languages: Chinese, Czech, English, French, German, Hungarian, Japanese, Portuguese (Brazil), Portuguese (Portugal), Romanian, Russian, Slovakian, Spanish Links Press portal: www.continental-presse.com Financial reports: www.continental-ir.com Video portal: http://videoportal.continental-corporation.com Media database: www.continental-mediacenter.com --------------------------------------------------------------------- 09.11.2015 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. 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: Regulated Market in Frankfurt (Prime Standard), Hamburg, Hanover, Stuttgart; Regulated Unofficial Market in Berlin, Dusseldorf, Munich; Terminbörse EUREX; SIX End of News DGAP News Service --------------------------------------------------------------------- 410177 09.11.2015