Sogefi: results higher in first nine months of 2021

Revenues at € 990.0 million: up by 20.9% at constant exchange rates on 9M 2020
Better performance than the market in all geographical areas 

EBITDA margin at 14.6% of revenues higher than in first 9M of 2020 (11.8%) and 2019 (12.1%)

Net income from continuing operations € 24.3 million (loss of € 15.6 million in 9M 2020 and earnings of € 14.9 million in 9M 2019)

Positive Free Cash Flow of € 25.1 million (negative for € 55.6 million in 9M 2020 and for € 4.2 million in 9M 2019)

Milan, October 22 2021 – The Board of Directors of Sogefi S.p.A., which met today under the chairmanship of Monica Mondardini, has approved the Interim Financial Report of the group as of September 30 2021, as presented by Chief Executive Officer Frédéric Sipahi.

Sogefi, a company of the CIR Group, is one of the main global producers of automotive components in three sectors: Air and Cooling, Filtration and Suspensions.


After the rises reported in the first and in the second quarter (+15.7%, +48.3%), in the third quarter of 2021 global car production was weak and significantly lower than that of the same period of 2020 (-19.7%) in which there had been a strong recovery. This was due to the difficulties experienced in the sourcing of particular components, which slowed production and even led to the temporary shutdown of certain production facilities of the main producers worldwide.

In the first nine months of 2021 world car production did in any case report growth of 9.5% compared to the same period of 2020: +4.4% in Europe, +6.8% in NAFTA, +7.7% in China, +28.7% in Mercosur and +48.4% in India.

Lastly, despite the recovery, production volumes were still significantly lower than those before the spread of the pandemic in all geographical areas, with the sole exception of China. In fact world production in the first nine months of 2021 was 15.5% lower than that of the same period of 2019, with Europe reporting -27.6%, NAFTA -21.5%, Mercosur -23.3% and China substantially in line with 2019 (-1.8%).


The Group reported a significant recovery in revenues, which rose by 19.4% compared to the first nine months of 2020, clearly outperforming the market. Compared to the same period of 2019, revenues posted -9.1%, versus a -15.5% fall in car production worldwide.

The recovery in revenues and the action taken to counter the impact of the crisis made it possible to close the first nine months of the year with:

  • EBITDA higher at 14.6% of revenues (11.8% in 9M 2020 and 12.1% in 9M 2019);
  • Net income from “continuing operations” of € 24.3 millionversus a loss of € 15.6 million in the same period of 2020;
  • Positive free cash flow of € 25.1 million (a negative € 55.6 million in the first nine months of 2020);
  • Net debt before IFRS 16 of € 267.4 million, lower than the figure at December 2020 (€ 291.3 million).

During the first nine months of the year commercial activity posted a positive performance.

The Air and Cooling division obtained important contracts in Europe, NAFTA and China for the supply of thermal management products for electric mobility, which incorporate a higher added value than the standard average value for traditional plastic products. More specifically, these were new contracts entered into with a premium German car maker for a new-generation electric platform and with two producers of electric commercial vehicles, one of which is pure electric while the other uses fuel cell technology.

The Filtration division obtained a significant number of contracts for the supply of air purification filters and two important contracts in NAFTA for transmission filters.

The Suspensions division obtained various contracts with new customers focusing exclusively on electric platforms.


In the first nine months of 2021 Sogefi’s revenues totalled € 990.0 million and were up by 19.4% at historical exchange rates and by 20.9% at constant exchange rates compared to the same period of 2020. After the increases of 5.2% in the first quarter and 94.5% in the second quarter, the third quarter closed with a decline in revenues of 3.8% at current exchange rates, compared to the market’s -19.7%. Revenues for the first nine months of 2021 were down by 9.1% compared to those of the first nine months of 2019.

Performance of revenues by geographical area

Revenues at constant exchange rates rose by 17.6% in Europe, by 13.6% in North America, by 19.4% in China and by 104.6% (72.3% at current exchange rates) in South America. Thus in all geographical areas Sogefi outperformed the market.

Performance of revenues by Business Unit

In the first nine months of 2021 the Air and Cooling and the Filtration Business Units reported a greater recovery in business activity compared to 2020 than that of the market, with revenues more or less in line with those of the corresponding period of 2019.

The growth in revenues of the Air and Cooling division (+20.5% at constant exchange rates and +19.8% at current exchange rates compared to the same period of 2020) was due not only to the market recovery by also to the development of its contract portfolio especially in China, where revenues at constant exchange rates have risen by 24.3% on the previous year.

The higher revenues of the Filtration division (+18.8% at constant exchange rates and +17% at current rates compared to the same period of 2020) reflect not only the trend of the market but also the strong recovery in India.

Lastly, the Suspensions Business Unit reported a 23.8% rise in revenues at constant exchange rates (+21.7% at current rates) compared to the first nine months of 2020, although business activity remains significantly lower than in the same period of 2019 (-20% at current exchange rates).


EBITDA came in at € 144.1 million, up from € 98.1 million in the first nine months of 2020 and € 131.5 million in the first nine months of 2019; gross profitability (EBITDA / Revenues %) rose to 14.6%, versus 11.8% in the first nine months of 2020 and 12.1% in the same period of 2019.

The higher profitability is the result of the rise in the contribution margin to 31.4% (29.8% in the first nine months of 2019 and 30.4% in the same period of 2020) and of the reduction of the impact of fixed costs on revenues to 16.4% (17.2% and 17.3% in the first nine months of 2019 and 2020 respectively). Fixed costs declined by 13.3%, compared to the first nine months of 2019, thanks to the action plans put in place.

Lower restructuring costs also contributed to the increase in EBITDA (€ 2.3 million versus € 12.2 million in the first nine months of 2020 and € 4.8 million in the same period of 2019).

The third quarter was affected by the weakness of volumes and the generalized increase in the cost of raw materials, particularly steel prices for the production of suspensions, which caused a reduction in the contribution margin that is destined to continue in the fourth quarter of the year.

EBIT came to € 49.4 million, compared to € 3.3 million in the same period of 2020 and € 41.9 million in the first nine months of 2019.

Financial expense, which totalled € 13.4 million, was lower than that of the same period of 2020 (€ 16.0 million), thanks to the reduction of the debt and to an item of non-recurring financial income of € 1.2 million; tax expense amounted to € 13.2 million, up from € 2.9 million in the previous year.

Net income from continuing operations came to € 24.3 million, versus a loss of € 15.6 million in the first nine months of 2020.

The net result of “discontinued operations and operations held for sale” was a loss of € 24.7 million (€ 8.2 million in the first nine months of 2020) and came from the sale of the filtration business in Argentina, which had a negative impact on the income statement of € 23.3 million, of which € 20.6 million from the reclassification of the exchange rate differences accrued by the subsidiary from equity to result for the year, which had no impact on liquidity or on equity.

The net result for the period was a loss of € 2.0 million, compared to a loss of € 23.2 million in the first nine months of 2020 and net income of € 8.3 million in the first nine months of 2019.


Free Cash Flow was a positive € 25.1 million, which compares with a cash absorption of  € 55.6 million in the first nine months of 2020, the performance of which was of course anomalous because of the sharp contraction of business activity due to the Covid-19 pandemic.

Net financial debt before IFRS 16 amounted to € 267.4 million at September 30 2021, down from December 31 2020 (€ 291.3 million) and September 30 2020 (€ 299.0 million) and was close to being in line with September 30 2019 (€ 264.6 million).

Including the financial payables for rights of use, as per IFRS 16, the net debt figure at September 30 2021 stood at € 335.5 million, down from € 358.1 million at December 31 2020 and € 374.5 million at September 30 2020.

At September 30 2021 the Group had committed credit facilities in excess of its requirements for € 265.0 million (after repaying its convertible bond of € 100.0 million in May 2021).

At September 30 2021 shareholders’ equity, excluding minority interests, came to a total of € 168.3 million (€ 133.0 million at December 31 2020).


In the third quarter of 2021 Sogefi reported a decline in revenues of 3.8% (-4% at constant exchange rates) compared to the third quarter of 2020, to € 316.6 million, after seeing growth of 5.2% in the first quarter and of 94.5% in the second quarter. The group’s revenues were affected by the market trend which involved a 19.7% fall in production in the third quarter. The group’s performance, however, was considerably better than that of the market.

EBITDA came to € 35.8 million, down from € 45.9 million in the third quarter of 2020 and € 44.7 million in the same period of 2019. The reduction in EBITDA reflects the weakness of revenues due to the market scenario and to the reduction in the contribution margin (from 30.8% in third quarter 2020 to 28.4% in third quarter 2021) because of the higher cost of raw materials, which particularly affected the results of the Suspensions Business Unit. Negotiations are in progress with customers to adjust selling prices to the current cost of raw materials.

EBIT was positive for € 2.1 million versus € 14.8 million in the third quarter of 2020.

The net result of continuing operations was a loss of € 2.1 million, which compares with net income of € 5.2 million in the third quarter of 2020.

The net result of “discontinued operations and operations held for sale” was a loss of € 21.2 million (net income of € 0.3 million in third quarter 2020), of which € 20.6 million came from the reclassification of the exchange rate differences accrued by the Argentinian subsidiary from shareholders’ equity to result for the year, which had no impact on liquidity or equity.

The consolidated net result for the third quarter of 2021 was a loss of € 23.4 million, versus net income of € 5.6 million in the previous year.


In the first nine months of 2021, despite the continuing pandemic crisis, the effects on the market in which the Company operates were less severe than those recorded for the first nine months of 2020 and consisted of a general weakness in demand, which was still lower than in the same period of 2019, especially in Europe (-27.6%) and NAFTA (-21.5%).

During the first nine months of 2021, the Sogefi Group continued to apply all the rules for health and safety in the workplace with the aim of reducing the risk of contagion. These include social distancing, the use of individual protection systems and measures to limit the presence of personnel in the workplace, with staff working from home.


No significant events have taken place since the close of the period.


Visibility as to the market trend in the next few months remains low mainly due to the continuing uncertainty about the evolution of the pandemic and the macroeconomic situation.

There are also specific critical issues relating to the generalized increase in the prices of the main raw materials and their availability, as well as logistic difficulties involving transportation and sourcing from Asian markets.

Given this scenario, IHS has revised its estimates for world production down, forecasting that fourth quarter 2021 will be down by approximately 20% on the same period of 2020, with Europe at -24.9%, NAFTA at -16.8% and China at -19.6%.  Therefore, for the whole year 2021 production should be in line with that of 2020 (+0.3%) but still around 16% lower than that of 2019. The expected recovery of volumes after the fall reported in 2020 is therefore forecast by IHS to take place in 2022, the year in which IHS is projecting growth of 10.6%.

For the fourth quarter of 2021, Sogefi expects the market to remain weak, in line with IHS projections, and pressure on commodity prices (steel, plastic and paper) to continue with possible negative effects on the contribution margin. To mitigate these effects the Group has already launched resourcing initiatives, has taken commercial action and adopted measures to reduce labour costs.

Provided there are no extraordinary circumstances or events that are not at present foreseeable, Sogefi confirms the view it expressed in the publication of its results for first half 2021, i.e. for the full year it expects to achieve an operating result at least equal to that reported for 2019.

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