Board of Directors approves results as of December 31 2015
SOGEFI (CIR GROUP):
Revenues up by 11.1% in 2015 at € 1.5bn (+9.1% like for like)
Solid growth in Europe (+8.2%) and in North America (+27.4%)
EBITDA at € 115.5m up € 6m in 2015
Net income at € 1.1m (€ 3.6m in 2014)
€ 17m investment planned for a new plant in Mexico
Milan, February 29, 2016 – The Board of Directors of Sogefi S.p.A., which met today under the chairmanship of Monica Mondardini, has approved the proposed statutory financial statements and the consolidated financial statements of the company for financial year 2015.
Laurent Hebenstreit, Sogefi’s Chief Executive Officer, made the following statement:
“For Sogefi, 2015 was a transitional year, in which the company addressed managerial, organizational changes and non-recurring issues. The positive performance in terms of revenues in all geographic areas reflects solid organic growth in Europe and North America, development in China and resilience in South America despite local market weakness. We are working to reduce costs, to improve profitability and to generate cash”.
Sales up 11.1% in 2015
Sogefi reported significant revenue growth in 2015 to € 1,499.1 million (+11.1%, + 9.1% on a like-for-like basis) thanks to the positive contribution of all business units and all geographical areas, with the exception of Latin America.
Sales by geographical area: robust growth in Europe and North America
Europe, which represents the group’s main market, increased by 8.2% in 2015, underpinned by the market expansion with a positive contribution from all areas of the business.
In North America Sogefi is outperforming the market, benefiting from its strong positioning with regard to North American car manufacturers.
In South America, sales decreased by 3.8% (+2.8% on a like-for-like basis) despite the market weakness
(-20.5% production decline) thanks to the positive contribution of the suspensions business.
In 2015 revenues in Asia increased by 34.4% or 18.7% on a like-for-like basis.
Sales by business unit: significant growth in 2015
In 2015 all business units contributed with solid revenue growth: Suspensions sales increased +10.1%, Filtration +13.2% and Air&Cooling +9.3% versus the previous year.
Operating results and net income
EBITDA in 2015 grew by € 6 million to € 115.5 million (7.7% of sales).
It is worth recalling that non-recurring expenses of € 21.5 million were recorded in 2015 of which € 11.8 million in Q2 for the Air & Cooling provision for product warranties and € 7.3 million for restructuring costs.
D&A, including asset write- downs, increased from € 59.9 million in 2014 to € 64.8 million over 2015. As a result, consolidated EBIT amounted to € 50.7 million compared to € 48.3 million in 2014.
The net result was a positive € 1.1 million, down slightly from € 3.6 million in 2014 as an effect of higher financial expense, which in the previous year had benefited from positive non-recurring items.
Shareholders’ equity
At December 31, 2015 shareholders’ equity excluding minority interests amounted to € 170.8 million
(€ 161.2 million at December 31 2014).
Net debt
Net financial debt stood at € 322.3 million at December 31 2015 compared to € 304.3 million at December 31 2014. The change during the year included non-recurring items of approximately € 20 million which referred to product quality guarantee charges.
Tangible investments were increased from € 42.3 million in 2014 to € 51.3 million in 2015. These investments were mainly to increase production capacity, to industrialize new products, to improve processes and to increase productivity.
Employees
At the end of 2015, the Sogefi group had 6,702 employees compared to 6,668 at December 31 2014.
Results of the parent company Sogefi S.p.A.
In 2015 the parent company Sogefi S.p.A. reported a net loss of € 6.8 million (€ 2 million profit in 2014). The 2015 result was negatively affected by higher non-recurring costs, mainly the cancellation of € 6.1 million of intercompany receivables with the Argentinian subsidiaries and € 2.2 million of restructuring costs.
Net debt stood at € 305.8 million at December 31 2015, posting a net decrease of € 1.9 million compared to the corresponding value at December 31 2014.
Shareholders’ equity at the same date amounted to € 167.5 million (€ 161.3 million at December 31 2014).
Outlook
In 2016 the global car market is expected to increase by 2.5%. Sogefi expects to continue the positive trends in North America, China and India. In Europe after the important business expansion seen in 2015, the company expects a more modest growth, while in South America market conditions remain difficult. Sogefi plans to expand its presence in the North American markets through an investment of € 17 million at Monterrey (Mexico) in a new plant serving all three business units.
Proposed dividend
The Board of Directors will propose to the Annual General Meeting of the Shareholders that no dividend distribution be approved.
Shareholders’ Meeting
The Annual General Meeting of the Shareholders of Sogefi has been convened at the first call for April 27 2016 and at the second call for April 28 2016.
The Board of Directors has specifically resolved:
– To propose that the Shareholders’ Meeting cancel and renew its authorization of the Board of Directors, for a period of 18 months, to buy back a maximum of 10 million of the company’s own shares (including the 2,994,650 shares already held as of today, corresponding to 2.52% of the share capital), at a unit price that cannot be more than 10% higher or lower than the official price of the shares recorded at the trading session on the regulated market prior to that of each individual transaction. The main reasons why this authorization is being renewed are the possibility of investing in shares of the company at prices below their actual value, based on the real economic value of its equity and its income generating prospects, and also of being able to use the shares bought back for the company’s share-based compensation plans;
– To put forward for approval by the Shareholders’ Meeting a stock grant plan for 2016 for the employees of the company and its subsidiaries for a maximum of 750,000 conditional rights, each of which will give the beneficiaries the right to be assigned 1 Sogefi share free of charge. The shares assigned will be taken from the own shares held by the Company as treasury stock.
The Annual General Meeting of the Shareholders will be called upon to vote on the renewal of the Board of Directors.
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