GRAMMER
Revenues, earnings continue to decline / Automotive supplier lowers sales forecast
— By Plasteurope.com staff —
 Chief financial officer Jurate Keblyt (Photo: Grammer) |
The weak economy in Europe and the crisis in the automotive industry are affecting the German manufacturer of vehicle seats and interior parts Grammer (Ursensollen; www.grammer.com). The company, which only recently sold its loss-making US subsidiary TMD, has now lowered its sales forecast for the year as a whole. Due to weaker demand and the deconsolidation of TMD, the automotive supplier now expects annual sales of EUR 2 bn instead of the previously stated EUR 2.3 bn. The forecast for operating EBIT, which was already lowered in August, remains at EUR 56.8 mn.
In the first nine months of the current year, Grammer generated sales of EUR 1.47 bn from continuing operations – i.e. excluding TMD activities. On a comparable basis, this was 4% more than a year earlier, according to the company. Operating EBIT fell by 27% to EUR 38 mn due to the costs of volatile plant capacity utilisation, and including restructuring expenses and negative special effects from the TMD sale, reported EBIT was negative at EUR -2.4 mn (nine months in 2023: EUR +47.9 mn).
Related: Grammer’s cost-cutting programme only partially effective so far
Business in the important sales region of Europe, Middle East, and Africa (EMEA) suffered particularly badly. Revenue here fell by 12% to EUR 810.8 mn. While the automotive product area remained comparatively robust with a decline of 2.9% to EUR 472.4 mn, the commercial vehicles product area was hit hard with a drop of 22% to EUR 338.4 mn. Operating EBIT slipped by 59% to EUR 18.9 mn.
In the Asia-Pacific sales region, turnover increased slightly by 3.2% to EUR 394.7 mn despite a decline in the commercial vehicle business. However, operating EBIT fell by 24% to EUR 32.8 mn. On the American continents, Grammer increased sales from continuing operations by 11% to EUR 305.3 mn. The operating EBIT loss was reduced to EUR -3.2 mn, compared with EUR -20.2 mn a year earlier.
The turnaround of the US business is Grammer’s top priority, explained CFO Jurate Keblyt. The sale of TMD is in line with the goal of concentrating on core competencies and products, and streamlining the portfolio. Further measures in this direction will now focus on the EMEA region, which Keblyt justified with the ongoing economic crisis.
In the first nine months of the current year, Grammer generated sales of EUR 1.47 bn from continuing operations – i.e. excluding TMD activities. On a comparable basis, this was 4% more than a year earlier, according to the company. Operating EBIT fell by 27% to EUR 38 mn due to the costs of volatile plant capacity utilisation, and including restructuring expenses and negative special effects from the TMD sale, reported EBIT was negative at EUR -2.4 mn (nine months in 2023: EUR +47.9 mn).
Related: Grammer’s cost-cutting programme only partially effective so far
Business in the important sales region of Europe, Middle East, and Africa (EMEA) suffered particularly badly. Revenue here fell by 12% to EUR 810.8 mn. While the automotive product area remained comparatively robust with a decline of 2.9% to EUR 472.4 mn, the commercial vehicles product area was hit hard with a drop of 22% to EUR 338.4 mn. Operating EBIT slipped by 59% to EUR 18.9 mn.
In the Asia-Pacific sales region, turnover increased slightly by 3.2% to EUR 394.7 mn despite a decline in the commercial vehicle business. However, operating EBIT fell by 24% to EUR 32.8 mn. On the American continents, Grammer increased sales from continuing operations by 11% to EUR 305.3 mn. The operating EBIT loss was reduced to EUR -3.2 mn, compared with EUR -20.2 mn a year earlier.
The turnaround of the US business is Grammer’s top priority, explained CFO Jurate Keblyt. The sale of TMD is in line with the goal of concentrating on core competencies and products, and streamlining the portfolio. Further measures in this direction will now focus on the EMEA region, which Keblyt justified with the ongoing economic crisis.
14.11.2024 Plasteurope.com [256619-0]
Published on 14.11.2024