SOGEFI: REVENUES UP 30.4% TO 687 MILLION
EBITDA AT 68.1 MILLION (+28.9%), NET INCOME HIGHER AT 16.1 MILLION
The strong growth reported in the United States (revenues up fourfold to over 50 million), in China (+12.9%) and in India (+69.9%) compensates for decline in European market and slowdown in Brazil
The group maintains good levels of profitability despite the difficult economic situation.
The integration of the Systèmes Moteurs businesses acquired in 2011 continues successfully
Consolidated results of first half 2012
Revenues: € 686.8 million (+30.4% from € 526.6 million in H1 2011)
Operating result: € 49 million (+18.5% from € 41.4 million in H1 2011)
EBITDA: € 68.1 million (+28.9% from € 52.8 million in H1 2011)
Net income: € 16.1 million (+4.8% from € 15.3 million in H1 2011)
Net debt: € 307.6 million (€ 299.3 million at 31/03/2012)
Milan, July 24 2012 – The Board of Directors of Sogefi SpA, which met in Milan under the chairmanship of Rodolfo De Benedetti, examined and approved the Semi-annual Financial Report as of June 30 2102. Sogefi, the automotive components company belonging to the CIR group, is one of the main world producers in the sectors of filters, engine air cooling systems and flexible suspension components with 44 production sites in 16 countries.
Performance of operations
In the first half of 2012 the Sogefi group posted a rise in revenues and profitability compared to the same period of 2011 thanks to the contribution of the businesses of Systèmes Moteurs, which were acquired in the second half of last year.
These results were obtained despite the difficulties in the car sector in Sogefi’s main market, Europe, which in the first half reported a fall in new car registrations of 6.8%, mainly because of the negative economic situation in the Mediterranean countries. However, at global level new car sales rose by 5%, thanks particularly to the United States (+13%), India (+12%), Russia (+15%) and Japan (+50% compared to the figure for 2011 which reflected the effects of the tsunami). Brazil and China, while still positive, did however suffer a slowdown. The production levels of new vehicles substantially reflected the evolution of sales with a delay of a few months.
Consolidated results
The revenues of the Sogefi group came to 686.8 million euro in the first half and were up by 30.4% from 526.6 million euro in the first half of 2011.
The rise was mainly in the Engine Systems division (filters and engine air cooling systems), thanks to the contribution of the Systèmes Moteurs businesses, whose revenues grew by 67.4% to 412 million euro (246.2 million euro in first half 2011). With the same consolidation as in first half 2011, the revenues of the division would have been down by 6.2%.
The revenues of the Suspension Components division came to 275.1 million euro, down slightly from 281.8 million euro in 2011. With the same consolidation, net of the acquisition of Systèmes Moteurs, the group’s revenues would have come to 504.9 million euro, posting a modest decline (-4.1%).
The greatest increase in revenues (+44.5%) was in the original equipment segment. The original spares aftermarket rose by 4.3% while the independent aftermarket was down by 5.8%. In geographical terms, the highest growth in revenues in the first half was in the United States (+277.9% to approximately 52 million euro; +27.3% with the same consolidation), India (+69.9%; +36.1% with the same consolidation) and China (+12.9%). The group even grew in Australia thanks to the Systèmes Moteurs businesses. By contrast, sales in Mercosur fell by 7.9% in the first half while Europe’s percentage of the group’s total revenues further declined to 69%.
During the period the Sogefi group benefited from the absence of any commodity price rises and pursued strict policies for containing all cost factors, especially structure costs. Its contribution margin, after the changes in its consolidation, went down to 30% in the first half compared to 31.8% in the same period of last year.
Its operating result came in at 49 million euro (7.1% of revenues) and was up by 18.5% from 41.4 million euro (7.9% of revenues) in the first half of 2011. With the same consolidation basis the result would have been 34.9 million euro (6.9% of revenues).
During the first half of the year restructuring charges of 1.4 million euro were recognized (1.6 million euro in the same period of 2011) and there were non-operating costs of 5.1 million euro (3.3 million euro in the first half of 2011) due to the writedown of assets for the production of stabilizer bars in the Prichard factory (USA) that are no longer used and to consulting fees linked to the international development of the group.
EBITDA came in at 68.1 million euro (9.9% of revenues), posting a rise of 28.9% on the figure of 52.8 million (10% of revenues) for the same period of 2011. With the same consolidation EBITDA would have come to 47.7 million euro (9.5% of revenues). EBIT was 36.7 million euro (5.3% of revenues), up by 20.1% compared to 30.6 million (5.8% of revenues) in the first half of 2011. With the same consolidation EBIT would have been 24.3 million euro (4.8% of revenues).
The net income of the group was 16.1 million euro in the first half of the year, up by 4.8% from 15.3 million in the same period of 2011. The lower growth in net earnings compared to operating results was due to the rise in financial expense (totalling 8.4 million euro versus 4.7 million euro in the same period of 2011) as a result of the higher average level of debt in the period following the acquisition of Systèmes Moteurs.
Net debt stood at 307.6 million euro at June 30 2012 (299.3 million euro at March 31 2012 and 299.8 million euro at December 31 2011). The change in the second quarter was due essentially to the dividend distribution of 17.2 million euro. The group’s equity totalled 191.9 million euro at June 30 2012 (195.2 million euro at December 31 2011).
The group had 6,760 employees at June 30 2012 (6,708 at December 31 2011).
Result of the parent company of the group Sogefi SpA
In the first half of 2012 the parent company of the group Sogefi SpA reported net income of 15.4 million euro (20.8 million in the same period of 2011). The decrease was due mainly to the lower dividend flows received from the subsidiaries and to the rise in financial expense caused by the higher average level of debt in the period following the acquisition of Systèmes Moteurs.
Its net debt stood at 257.3 million euro at June 30 2012 (258.9 million euro at March 31 2012 and 254.7 million euro at December 31 2011).
Outlook for the whole year
In the second half of the year there is not expected to be any improvement in the global car market compared to the first half. A possible recovery in China and Brazil following actions taken by their respective governments to support the economy should be offset by the lasting weakness of Europe. However a scenario of commodity price stability and continuing cost cutting actions should enable the Sogefi group to achieve economic results in the second half that are in line with those obtained in the first half of the year.
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