Continental: Tyre Division growing faster than the market

Dienstag, 22 Mai, 2018 - 16:45
At the end of the first quarter, Continental disposes of a liquidity cushion of 5.9 billion euros.

At the beginning of the year, Continental proved its growth potential in a reserved market environment. Above all, influences from exchange rates caused a lot of headwind in the first three months. In spite of these negative effects of a total of 546 million euros, turnover reached 11.0 billion euros and was at the same level as in a comparable period in the year before.

Thanks to our operative strength, we were able to grow worldwide in the first quarter – and even much faster than all of our relevant markets, which experienced a decrease in the same period of time. We will continue our growth dynamics and will further aim at a turnover of about 47 billion euros before exchange rate effects. “The adjusted EBIT margin is supposed to be at more than 10 per cent”, says Dr. Elmar Degenhart, CEO at Continental, presenting the business figures of the first quarter 2018. When asked about the big growth, Degenhart explains: “Continental disposes of a leading technology portfolio. As a system supplier, we are able to deliver all the relevant technologies for the mobility of the future. Thus, we offer people and their goods safer, cleaner and more efficient mobility, both today and in the future.” Moreover, incoming orders of the Automotive Group are to be considered as sign of our customers’ appreciation of the technologies Continental has developed. A value of 11 billion euros in the first quarter stands for a record level in this area.

After the first three months, the adjusted operative result of 1.1 billion euros was lower than the comparable figure in the previous year. Impacts from exchange rates effects and 100 million euros of negative influences from inventory valuations are responsible for this. All in all, the company expects burdens of about 150 million euros in this area affecting the result in the first half of 2018. This will not be balanced until the end of the year as already reported as mandatory announcement on 18th April. Compared to the first quarter of the previous year, turnover of the international automotive supplier, tyre manufacturer and industrial partner rose by 0.1 per cent to 11 billion euros. Adjusted by changes in the group of consolidated companies and exchange rates, there was an increase in turnover by 4.3 per cent. The group result of 738 million euros, which is attributable to the shareholders, was more or less at the same level as in the year before (750 million euros). The result per share was at 3.69 euros (3.75 euros in the previous year). The adjusted operative result (EBIT) dropped by 9 per cent to 1.1 billion euros compared to the closing date of the year before. This stands for an adjusted EBIT margin of 9.7 per cent after 10.6 per cent in the first quarter of the year before.

The Automotive Group was able to organically increase turnover by 5.5 per cent in the past quarter. Turnover achieved 6.8 billion euros. In the first three months, the Rubber Group had a turnover of 4.2 billion euros (4.3 billion euros in the previous year). The Tyre Division and ContiTech achieved both turnovers at the same level as last year. Adjusted by changes in the group of consolidated companies and exchange rates, there was a rise of 2.3 per cent. According to Wolfgang Schäfer, CFO at Continental, the Tyre Division was able to grow by two percentage points faster than the worldwide slightly decreasing market. Last quarter, Continental was able to further reduce its net financial debts. Up to 31st March, net liabilities were under two billion euros, among other things because of the dividend of 900 million euros being paid out only in the second quarter. The gearing ratio, which indicates the level of the debt ratio, fell from 12.6 per cent at the end of 2017 to 11.7 per cent on the reported closing day.