Sogefi (CIR group): results higher in first quarter 2012

Board of Directors approves results as of March 31 2012


Despite the slowdown in the automotive market due to the difficult global economic climate, the group has benefited from the acquisition of Systèmes Moteurs, consolidated in August 2011

Position in North American market continues to strengthen:
revenues up fourfold from first quarter 2011 and now account for more than 10% of total

Consolidated results of Q1 2012

Revenues: € 346.9 million (+35.6% from € 255.8 million in Q1 2011)
Operating result: € 24.6 million (+37.3% from € 17.9 million in Q1 2011)
EBITDA: € 34.3 million (+37.3% from € 25 million in Q1 2011)
Net income: € 9.2 million (+37.5% from € 6.7 million in Q1 2011)
Net debt: € 299.3 million (€ 299.8 million at 12/31/2011)

Milan, April 19 2012 – The Board of Directors of Sogefi SpA, which met today under the chairmanship of Rodolfo De Benedetti, approved the Interim Financial Report of the group for the first quarter of  2012.

Sogefi, the automotive components company of the CIR group, is one of the main world producers of engine systems and suspension components with a production presence comprising 43 production plants in 18 countries and 14 commercial offices.

Performance of operations

In the first quarter of  2012 the slowdown in the automotive sector in certain important markets continued because of the worsening economic and financial environment worldwide. In Europe, in particular, the economic climate together with the lower availability of credit further dampened the propensity to buy new cars. This led in the first quarter to a fall of 7.7% in new car registrations compared to the same period of 2011. This decline was reflected in the production levels of manufacturers, which went down by 5.1% compared to 2011 with negative lows in France, Italy and Spain.

In non-European markets there was a slowdown in levels of demand in Brazil and China, while North America continued to grow. Despite the worsening of the general climate, Sogefi closed the quarter with a rise in its main economic indicators of over 35% thanks to the full consolidation of the activities of Systèmes Moteurs, the acquisition of which was completed in the second half of 2011.

Consolidated results

Revenues for the first quarter came in at 346.9 million euro and were up by 35.6% compared to the figure of 255.8 million euro for the same period of 2011, thanks to the consolidation of Systèmes Moteurs as from August 1 of last year. With the same consolidation as last year, revenues would have been 254.1 million euro, substantially in line with 2011. The positive evolution of revenues applied especially to the Engine Systems Division, to which Systèmes Moteurs belongs, which posted strong growth (208.3 million euro versus 117.8 million in 2011), while the Suspension Components Division reported sales that were substantially unchanged from those of last year (139.3 million euro versus 138.7 million euro).

The most significant figure was the continuing growth in North America (NAFTA area), where Sogefi achieved revenues of 36.8 million euro, which were up fourfold on 2011 thanks to the acquisition of Systèmes Moteurs and to organic growth. North America now contributes 10.6% of the total revenues of the Sogefi group compared to 6.2% at the end of 2011. Growth is also continuing in India (revenues +75% compared to first quarter 2011), while in the Mercosur region there was a contraction of 4.3% due to the trend of the local market in the period. In Europe Sogefi reported revenues of 243.6 million euro, up by 32% on last year as a result of the contribution of Systèmes Moteurs (stable at 184.1 million euro with the same consolidation, despite the contraction in the market).

During the quarter the cost of the main commodities remained substantially unchanged from the corresponding period of last year.

The operating result for the quarter came in at 24.6 million euro (7.1% of revenues), posting growth of 37.3% compared to the figure for the same period of last year (17.9 million euro). The ratio of operating result to revenues with the same consolidation as last year, without including Systèmes Moteurs, would have been 6.9%.

EBITDA for the first three months came to 34.3 million euro (9.9% of revenues) and was up by 37.3% on the 25 million euro for the same period of 2011 (9.8% of revenues). With the same consolidation the ratio of EBITDA to revenues would have been 9.5%. EBIT was 20.1 million euro (5.8% of revenues), posting a rise of 45% on the figure of 13.9 million euro in first quarter 2011. With the same consolidation the ratio of EBIT to revenues would have been 5.3%.

The net income of the group came in at 9.2 million euro and was up by 37.5% compared to 6.7 million in the first quarter of 2011.

Net debt totalled 299.3 million euro at March 31 2012, which was substantially in line with the figure at the end of 2011 (299.8 million euro). The equity of the group stood at 202.1 million euro at March 31 2012, up from 195.9 million euro at December 31 2011.

The Sogefi group had 6,752 employees at the end of the first quarter of 2012 (6,708 at December 31 2011).

Outlook for the year 2012

The consolidation of the Systèmes Moteurs businesses for the whole year allows the group  to predict a significant rise in consolidated revenues for 2012, even in the presence of possible downturns in demand in the event of an adjustment of the production levels of European and Brazilian clients to their sales in the first quarter. The costs of the main commodities, including steel, should remain stable in coming quarters, enabling the group to reach levels of profitability that are at least in line with those reported in the first quarter.

The executive responsible for the preparation of the company’s financial statements, Giancarlo Coppa, hereby declares, in compliance with the terms of paragraph 2 of 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. 

Download pdf