Stabilus S.A.: Solid start to 2020 fiscal year - new organizational structure presented
Feb 03, 2020 7:00 AM
DGAP-News: Stabilus S.A.
/ Key word(s): Quarter Results
Stabilus S.A.: Solid start to 2020 fiscal year - new organizational structure presented
- Solid start to FY2020 despite continued weakness in the automotive market: Revenues in Q1 +2.8 percent to EUR 231.4 million
- Adjusted EBIT in Q1 at EUR 30.0 million compared to EUR 30.8 million in Q1 FY2019
- Q1 result reached EUR 16.4 million (Q1 FY2019: EUR 17.7 million) and free cash flow before acquisitions (adj. FCF) at EUR 7.8 million (Q1 FY2019: EUR 12.4 million)
- With revenue growth of 2 to 4 percent to EUR 970 million to EUR 990 million, the forecast for FY2020 was confirmed with an adjusted EBIT margin of around 15.0 percent
- New organizational structure reflects the growth of the company and its geographic positioning
Luxembourg/Koblenz, February 3, 2020 - In its first quarter ended December 31, 2019, Stabilus S.A. (ISIN: LU1066226637), one of the world's leading suppliers of gas springs, damping solutions and electromechanical drives for motion control, was able to decouple itself from the general development of the global automotive industry and recorded revenue growth. In addition, the Group announced its new organizational structure effective from the current fiscal year 2020, which will bundle Stabilus' activities into the segments EMEA, Americas and APAC in the future.
In the first quarter of FY2020, Group revenue rose by 2.8 percent compared to the previous year to 231.4 million euros (Q1 FY2019: 225.0 million euros). This growth was supported by currency and acquisition effects amounting to 4.1 percent of Group revenue.
Dr. Michael Büchsner, CEO of Stabilus, said: "Stabilus showed a solid performance in the first quarter given the ongoing adverse market environment characterized by a decline in automotive production worldwide. In particular, we are confident about the development of our business in the automotive segment in the regions Americas and Asia-Pacific and the growth in the Industrial business unit. We therefore confirm our forecast for the 2020 fiscal year. With our adapted organizational structure, which is an expression of our growth profile and the expanded geographic focus of the company, we are also setting the course for further profitable growth."
Adjustment of the organizational structure at the beginning of the 2020 fiscal year
The Group's new segment structure consists of the regions of North and South America ("Americas"), Europe, the Middle East and Africa ("EMEA") and Asia-Pacific ("APAC"). The previously designated region NAFTA is now included in the region Americas, and Europe is now included in the region EMEA. The Rest of World segment ("ROW") has been eliminated. The regions previously included in ROW - Latin America, the Middle East and Africa - will become part of the Americas and EMEA segments respectively.
Stabilus has also streamlined the structure of its business units into the divisions Automotive Gas Spring, Automotive Powerise and Industrial as of the beginning of the 2020 fiscal year. In light of improvements in efficiency and a more effective access to customers, the former divisions Industrial / Capital Goods and Vibration and Velocity Control were combined into one Industrial business unit. These adjustments will make it possible for Stabilus to manage its revenue activities in the Industrial business unit by the individual industry segments of customers instead of by product categories in the future.
Strong revenues performance in Americas and APAC
In the EMEA segment, revenues in Q1 FY2020 fell by 2.1 percent to 110.2 million euros (Q1 FY2019: 112.6 million euros), mainly due to the continuing weakness of the automotive market. In the Americas segment, revenues rose by 5.9 percent year-on-year to 90.4 million euros (Q1 FY2019: 85.4 million euros), with a strong US dollar supporting this development. Adjusted for currency and acquisition effects, the growth rate in Americas in Q1 FY2020 was 1.2 percent. In the Asia-Pacific segment, the company recorded a strong increase in revenues of 14.1 percent to 30.8 million euros (Q1 FY2019: 27.0 million euros) compared to the same quarter of the previous year. Adjusted for currency effects, revenue growth in the region was 12.8 percent in Q1 FY2020. All divisions contributed to the positive development in APAC, where the Automotive Powerise division in particular benefited from the revenue development with an increase of 38.8 percent compared to the same quarter of the previous year.
Industrial and Automotive Powerise business were growth drivers in Q1
Broken down by business unit, Stabilus reported an increase in revenues in both Industrial and Automotive Powerise in the first quarter of the 2020 fiscal year, while revenues in Automotive Gas Spring declined. In Automotive Powerise, which was able to decouple significantly from the decline in global automotive production, revenues rose by 2.6 percent to 63.6 million euros in Q1 FY 2020 (Q1 FY2019: 62.0 million euros), while revenues in Automotive Gas Spring decreased by 4.3 percent to 77.9 million euros (Q1 FY2019: 81.4 million euros). Adjusted for currency effects and acquisitions, revenue growth in these business units was 0.3 percent and -5.7 percent, respectively.
The Industrial business unit recorded a 10.2 percent increase in revenues to 89.9 million euros in Q1 FY2020 (Q1 FY2019: 81.6 million euros), thus compensating for part of the decline in revenues in Automotive Gas Spring. Adjusted for currency effects and acquisitions, revenue growth was 2.2 percent. The positive development at Industrial is due in particular to a strong business in the Americas region, which was characterized by a good order situation in the business with dampers for the solar industry. Stabilus achieved further growth in the areas of production and construction technology, medical technology and office furniture. This was offset by a weaker business with distributors and declines in revenues in the independent aftermarket, transport and agricultural machinery sectors.
For Q1 FY2020 in total, the Industrial business unit accounted for 39 percent (Q1 FY 2019: 36 percent) of Stabilus' Group revenue, and the two automotive business units Powerise and Gas Spring accounted for 61 percent (Q1 FY2019: 64 percent).
Adjusted EBIT margin of 13.0 percent in the first quarter
Adjusted operating profit (adjusted EBIT) fell by 2.6 percent to 30.0 million euros in Q1 FY2020. This corresponds to an adjusted EBIT margin of 13.0 percent, compared to 13.7 percent in Q1 FY2019.
In Q1 FY2020, profit was 16.4 million euros, compared to 17.7 million euros in the same quarter of the previous year. Free cash flow before acquisitions (adj. FCF) amounted to 7.8 million euros, compared to 12.4 million euros in Q1 FY2019.
Forecast for fiscal year 2020 confirmed
Stabilus confirms its forecast for the full fiscal year 2020 and continues to expect revenue growth of around 2 to 4 percent to approximately 970 million euros to 990 million euros as well as an adjusted EBIT margin of approximately 15.0 percent.
The quarterly statement for the first quarter of fiscal 2020 can be downloaded from the company's website at Investors/Financial Reports & Presentations 2020.
 Cf. definition/calculation of KPI's 'adjusted EBIT' and 'free cash flow before acquisitions (adj. FCF)' provided in our quarterly statement for Q1 FY2020, pp. 5 and 9, that can be downloaded from the company's website at Investors / Financial Reports & Presentations 2020.
As one of the world's leading suppliers of gas springs, damping solutions and electromechanical drives, Stabilus has for eight decades been demonstrating its expertise in the automotive industry and a variety of other sectors. Gas springs, dampers and electromechanical POWERISE drives from Stabilus optimize opening, closing, lifting, lowering and adjusting operations, and also protect against vibrations. Employing a workforce of more than six thousand worldwide, the company has its operational headquarters in Koblenz. Stabilus has reported revenues of EUR 951.3 million in the 2019 fiscal year. Stabilus has a global production network encompassing plants in eleven countries. Additionally, the Group maintains regional offices and relations to sales partners in over fifty countries in Europe, North, Central and South America, and in Asia-Pacific. Stabilus S.A. is listed in the Prime Standard segment of the Frankfurt Stock Exchange and included in the SDAX index.
This press release may contain forward-looking statements based on current assumptions and forecasts made by Stabilus Group management and other information currently available to Stabilus. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, development or performance of the company and the estimates given here.
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