Board of Directors approves results as of March 31 2015
SOGEFI (CIR GROUP): REVENUES UP BY 10% TO € 373 MLN (+5.9% AT SAME EXCHANGE RATES) NET INCOME AT € 7.6 MLN (LOSS OF € 6.3 MLN IN Q1 2014)
The rise in sales was due to higher volumes in all of the geographical areas
and partly also to favourable exchange rates
Revenues rose in Europe by 7.7%, in North America by 15.1% and in Asia by 39.7%.
Sales in South America were up slightly despite the continuing weakness of the market
EBITDA and earnings benefit from higher revenues
and lower restructuring costs than in 2014
EBITDA before restructuring +10.7% to € 35.2 mln,
with ratio to sales stable at 9.5%
Milan, April 20 2015 – The Board of Directors of Sogefi S.p.A., which met today under the chairmanship of Rodolfo De Benedetti, has approved the Interim Financial Report of the group for the first quarter of 2015.
Sogefi, the automotive components company of the CIR group, is one of the main world producers of engine systems and suspension components and is present with 42 production plants in 21 countries and 16 commercial offices.
Performance of operations
The first quarter of 2015 for the automotive sector was characterized by a positive performance of almost all the main world markets, with an increase in production levels of passenger cars and light commercial vehicles in Europe (+4.1%), NAFTA (+2.2%) and Asia (+5.7%).
The recessionary phase continued however in the South American market with production down by 14.9% in the quarter compared to the same period of 2014.
In this climate, Sogefi reported growth in its revenues of 10% thanks to the higher volumes in all the geographical areas and partly also to the favourable effect of exchange rates (+5.9% growth at the same exchange rates). A significant figure was the strong growth in revenues in Europe, underpinned by the rise in volumes in both the original equipment and the aftermarket businesses.
Thanks to the rise in revenues and to the lower restructuring costs, the group obtained a positive net result after a loss in the first quarter of 2014.
Consolidated results
Sogefi closed the first quarter with consolidated revenues of € 372.5 million, which were up by 10% on the first quarter of 2014 (+5.9% at the same exchange rates).
As for the various geographical areas, the company reported a positive performance in Europe (revenues up by 7.7% to € 244.9 million; +6.5% at the same exchange rates), North America (+15.1%; +3% at the same exchange rates) and Asia (+39.7%; +19.2% at the same exchange rates). In South America Sogefi reported a rise in revenues of 3.3% (+0.5% at the same exchange rates), despite the continuing weakness of the market.
The Engine Systems Business Unit reported a rise in revenues of 10.2% to € 232 million versus € 210.6 million in the first quarter of 2014, while the Suspension Components Business Unit posted revenues of € 141.1 million, up by 9.5% on the same period of last year (€ 128.8 million).
EBITDA before restructuring came to € 35.2 million, up by 10.7% compared to the first quarter of last year (€ 31.8 million), with a ratio to sales of 9.5% (9.4% in 2014). The erosion of contribution margins is continuing but in the first quarter if was offset by the lower impact in percentage terms of fixed costs.
EBITDA came in at € 34.9 million, up significantly from € 20.9 million in the first quarter of 2014. It should be remembered that in first quarter 2014 the group had incurred restructuring charges for a total of € 11.3 million, reduced to € 0.4 million in the first three months of 2015.
EBIT before restructuring came to € 19.5 million and was up by 13.7% with a ratio to sales of 5.2% versus 5% in the corresponding period of 2014. EBIT was € 19.1 million (€ 5.8 million in first quarter 2014).
The result before taxes and minority interests was a positive figure of € 12.3 million (a negative € 2.6 million in first quarter 2014), after net financial expense of € 6.8 million. Net financial expense also includes a non-recurring gain of € 1.5 million from the periodic mark to market of the derivative embedded in the convertible bond until January 28 2015, when the company renounced the right to settle the exercise of the conversion rights of the bond in cash.
The consolidated net result of the first quarter of 2015 was a positive figure of € 7.6 million, compared to a loss of € 6.3 million in the same period of last year.
Net debt stood at € 327.5 million at March 31 2015 and was substantially in line with the figure at the end of March 2014 (€ 322.5 million). The increase compared to € 304.3 million at December 31 2014 was due to the seasonal rise in working capital typical of the automotive sector and to cash disbursements relating to the restructuring charges recognized last year. Moreover, the net financial position received a total positive impact of € 10.5 million from the derivative embedded in the convertible bond and a disbursement of € 8 million as payment of a provisional amount, linked to quality charges, which had already been set aside at the end of last year.
Shareholders’ equity excluding minority interests stood at € 182.5 million at March 31 2014 (€ 161.2 million at December 31 2014).
The Sogefi group had 6,771 employees at the end of first quarter 2015, up from 6,668 at December 31 2014.
Outlook for the year
In 2015, in a global car market that appears to be growing, Sogefi expects to continue the positive trends seen in North America, China and India. In Europe, the company should achieve a slightly better performance than last year, while in the South American market it is likely that the current phase of weakness will continue.
The executive responsible for the preparation of the Company’s financial statements, Giancarlo Coppa, hereby declares, in compliance with the terms of paragraph 2 Article 154-bis of the Finance Consolidation Act (TUF), that the accounting figures contained in this press release correspond to the results documented in the Company’s accounts and general ledger.
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