SHW AG

EANS-News: SHW AG reaches sales and earnings targets despite difficult market environment in Europe

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Financial Figures/Balance Sheet/ Preliminary key financial figures 2012 

Aalen (euro adhoc) - Group sales climb 2.5 percent to EUR 325 million in FY 2012
in spite of declining vehicle output in Europe
- EBITDA[1] grows by 6.5 percent to EUR 33.9 million
- Sale of stake in joint venture STT Technologies Inc. helps to significantly
improve consolidated net income from EUR 17.0 million to EUR 46.1 million
- Net cash position reaches EUR 19.6 million as at 31 December 2012
 
Aalen, 12 February 2013. SHW AG, one of the leading suppliers of CO2-relevant
pumps and engine components as well as brake discs, today published the
preliminary and unaudited key figures[2] for the year 2012. "We were able to
slightly exceed the projected EBITDA margin of around ten percent in spite of
the considerable decline in European vehicle production," emphasised CEO Dr.
Wolfgang Krause, who is in charge of the Pumps and Engine Components business
segment.
 
Due to production start-ups and the favourable customer structure, SHW was able
to disconnect itself from the negative market trend in 2012 - vehicle production
in Europe was down by 5.8 percent - and to improve its Group sales by 2.5
percent to EUR 325.4 million (previous year: EUR 317.3 million). Group earnings
before interest, taxes, depreciation and amortisation (EBITDA) increased by 6.5
percent to EUR 33.9 million in the period from January to December 2012
(previous year: EUR 31.9 million). At 10.4 percent, the EBITDA margin slightly
exceeded the previous year's level of 10.0 percent.
 
Consolidated net income amounted to EUR 46.1 million in 2012, compared to EUR
17.0 million in the previous year. This amount includes the net result from
discontinued operations of EUR 31.9 million. Earnings after taxes from continued
operations reached EUR 14.3 million (previous year: EUR 14.9 million). Earnings
per share from continued operations[3] amounted to EUR 2.44, compared to EUR
2.57 in the prior year period.

Planned growth track rests on a solid financial foundation
 
The sale of stake in the joint venture STT Technologies Inc., Toronto/Canada and
the resulting cash inflow of EUR 42.9 million further improved the solid
financial position of SHW AG. As at the balance sheet date on 31 December 2012,
SHW had net cash in an amount of EUR 19.6 million (previous year: net bank debt
(excl. STT) of EUR 12.6 million)).
 
As a result of the high consolidated net income, the Group's equity was up by
EUR 39.2 million on the previous year to EUR 94.3 million. This represents an
equity ratio of 52.4 percent, compared to 31.7 percent on 31 December 2011.
 
SHW intends to use its solid financial position for additional organic growth
and the development of important automobile markets such as the USA, Brazil and
China. "Combined with the new long-term syndicated loan we are able to finance
acquisitions in the mid double-digit million range," says Oliver Albrecht, CFO
of SHW. In addition, the company is considering paying out a special dividend.
 
Positive sales performance in Pumps and Engine Components business segment
 
The Pumps and Engine Components business segmentboosted its sales by 5.7 percent
to EUR 237.9 million (previous year: EUR 225.1 million) thanks to production
start-ups and increasing sales of gearbox oil pumps. The Passenger Car division
reported a 10.2 percent increase in sales to EUR 182.2 million (previous year:
EUR 165.4 million). The Truck & Off-Highway division suffered from the
noticeable deterioration of the market environment for commercial vehicles and
generated sales of EUR 27.4 million (previous year: EUR 31.7 million). Sales in
the Powder Metallurgy division improved by 1.0 percent to EUR 28.3 million
(previous year: EUR 28.0 million).
 
After the expected weaker fourth quarter, the operating result was below prior
year's level. In particular, the lower earnings contributions from the higher-
margin Truck & Off-Highway division because of lower sales had an adverse impact
on the bottom line. Moreover, in the context of a production start-up one-time
expenses of EUR 1.5 million incurred in the fourth quarter due to the delayed
delivery and launch of an assembly line. Due to these effects, the segment's
earnings before interest, taxes, depreciation and amortisation (EBITDA) declined
from EUR 29.4 million to EUR 27.8 million. The EBITDA margin dropped from 13.1
percent to 11.7 percent.
 
Very positive earnings performance for Brake Discs business segment
 
In the Brake Discs business segment, the number of composite brake discs sold
increased by 14.8 percent to 169,200 units (previous year: 147,400) in the
financial year 2012. Sales of ready-to-install brake discs declined by 4.9
percent to 1.7 million pieces (previous year: 1.8 million) due to declining
orders from several OEMs in the fourth quarter. Sales of unprocessed brake discs
dropped by approx. 16.6 percent to 2.0 million pieces (previous year: 2.4
million). Total brake disc sales were down by 10.8 percent to 3.9 million pieces
(previous year: 4.4 million). Thanks to the significant improvement in the
product mix towards high-value brake discs, sales revenues declined at a lower
rate than the brake disc output, namely by 5.2 percent to EUR 87.5 million
(previous year: EUR 92.2 million) in fiscal 2012.
 
Earnings before interest, taxes, depreciation and amortisation (EBITDA) almost
doubled from EUR 3.6 million to EUR 6.9 million. Accordingly, the EBITDA margin
climbed from 3.9 percent in the previous year to 7.9 percent. Besides the
noticeably improved product mix, the business segment also benefited from
productivity improvements.
 
Good start into the new financial year

SHW had a good start into the new financial year. At EUR 26.6 million, Group
sales were only slightly below the previous year's level of EUR 26.7 million.
The positive trend towards fuel-efficient pumps continued in the Pumps and
Engine Components business segment, which generated EUR 19.7 million in sales
(previous year: EUR 19.1 million). At EUR 6.9 million, sales in the Brake Discs
business segment were down by roughly ten percent on the previous year's EUR 7.6
million. 

The full financial statements for the year 2012 and the outlook on the fiscal
year 2013 will be published with SHW's Annual Report on 21 March 2013.


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[1] Adjusted for one-time effects, 2011: IPO costs (EUR 2.2 million); 2012: non-
recurring expenses from a production start-up (EUR 1.5 million).

[2] Since the sale STT Technologies Inc., which was previously consolidated on a
pro-rata basis, has been classified as "discontinued operation" as defined in
IFRS 5. The prior year figures have been adjusted accordingly.
[3] 2011: based on an average of 5,798,195 shares; 2012: based on an average of
5,851,100 shares.
 
About SHW
The enterprise was established in 1365, making it one of the oldest industrial
enterprises in Germany. Today, the SHW Group is a leading supplier for the
automotive industry with products that contribute to a reduction of fuel
consumption and consequently CO2 emissions. In its Pumps and Engine Components
business segment, the SHW Group develops and produces pumps for passenger
vehicles and truck and off-highway applications, e.g. trucks, farm and
construction vehicles, stationary motors and wind power stations. The Brake
Discs business segment develops and produces monobloc ventilated brake discs
made of cast iron and lightweight brake discs made from a combination of an iron
friction ring and an aluminium pot. Customers of the SHW Group include leading
producers of passenger cars and commercial vehicles with manufacturing
facilities in Europe and North America. The SHW Group has four manufacturing
sites in Germany, located in Bad Schussenried, Aalen-Wasseralfingen, Tuttlingen-
Ludwigstal and Neuhausen ob Eck. With more than 1,000 employees, the SHW Group
generated sales from continuing operations in 2012 of EUR 325 million. Further
information is available at: www.shw.de

 
Future-oriented statements
This press release contains certain future-oriented statements that are based
upon current assumptions and forecasts made by the management of SHW AG. Various
known and unknown risks, uncertainties and other factors may lead to the actual
results, financial position, development or performance of the company deviating
considerably from the appraisals specified here. The company assumes no
obligation to update future-oriented statements of this nature or adapt them to
future events or developments.
 
Note
This announcement does not constitute an offer to sell securities in the United
States of America, Canada, Australia, Japan or any other jurisdictional
territory where offers are subject to statutory restrictions. The securities
named in this announcement may only be sold or offered for sale in the United
States of America following their prior registration in accordance with the
provisions of the version of the US Securities Act of 1933 currently in force
(the "Securities Act") or, without prior registration, only on the basis of an
exemption. Unless provided for by certain exceptions within the Securities Act,
the securities named within this announcement may not be sold or offered for
sale in Australia, Canada or Japan, nor may they be sold or offered for sale to
or for account of residents of Australia, Canada or Japan. No registration of
the offer or sale of the securities named in this announcement will take place,
as stipulated by the relevant statutory provisions in Canada, Australia and
Japan. There is no public solicitation to buy securities in the United States of
America.


Further inquiry note:
Michael Schickling
Head of Investor Relations & Corporate Communications
SHW AG
Telephone: +49 (0) 7361 502 462
Email: michael.schickling@shw.de

end of announcement                               euro adhoc 
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company:     SHW AG
             Wilhelmstrasse 67
             D-73433 Aalen
phone:       +49 7361 502-1
FAX:         +49 7361 502-674
mail:     ir@shw.de
WWW:      http://www.shw.de
sector:      Automotive Equipment
ISIN:        DE000A1JBPV9
indexes:     
stockmarkets: free trade: Düsseldorf, Stuttgart, regulated dealing/prime
             standard: Frankfurt 
language:   English
 



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