Feintool shows good full-year results in 2016
Organic higher sales
The global automobile industry continued to grow in 2016. Feintool benefitted from this positive industry trend and grew – despite challenging demands – by outpacing the market in every relevant region.
The Feintool Group generated sales of CHF 552.2 m in the 2016 financial year, which corresponds to an increase of 8.5%. Adjusted for currency effects, the company achieved a growth of 5.9%.
The System Parts segment, in which Feintool is globally present with the high-volume production of precise fineblanked and formed components, accounts for the largest share of sales. In the reporting year, the segment grew in local currency by 6.5% to CHF 479.3 m, thus generating 86.8% of the consolidated sales. This increase is primarily due to the increased global volume of new products in Europe in comparison to the previous year.
In the Fineblanking Technology segment, in which Feintool provides comprehensive technological solutions for fineblanking, sales totaled CHF 92.7 m. The 4.9% increase compared to the previous year in local currency is due to the pick up of press sales in Asia as well as increased internal orders.
Vastly improved operating profit
All segments and regions made a positive contribution to the operating profit this year as well. The Feintool Group generated an EBIT of CHF 41.3 m, which is a significant increase of 20.8% in local currency. The operating business achieved an EBIT margin of 7.5%.
The System Parts segment achieved an EBIT of CHF 44.4 m and an EBIT margin of 9.3%. The sales growth due to the good automobile economy and new launches or ramp-ups of many products led once again to higher capacity utilization at most companies, which had a positive impact on margins overall. The programs for increasing efficiency at all locations and higher added value have supported this pleasing development.
In the Fineblanking Technology segment investment goods business, Feintool generated an operating profit of CHF 4.3 m. The margin fell to 4.7% compared to the previous year. The main reason for this development is the increased research expenses of CHF 5.6 m as an investment in the future as well as costs in the amount of CHF 1.2 m for the reorganization of the China business.
Group result has risen
Feintool generated a consolidated net income of CHF 32.1 m overall, which equates to a margin of 5.8%.
Numerous orders and expected releases
The expected releases from our customers in the high-volume parts business for the next six months total CHF 240.9 m. This value increased by 14.9% and is now at a record high at the end of the year. Accordingly, our customers expect a positive market environment in every region.
Orders received in the Fineblanking Technology segment fell by 8.8% to CHF 85.8 m, with CHF 28.6 m stemming from the System Parts segment, which was significantly more than in the previous year. Thus, third-party orders received fell to CHF 57.2 m. The orders backlog decreased by 18.8% to CHF 35.1 m, with CHF 16.0 m from intragroup orders. The order backlog is therefore about six months.
Higher dividend planned
In view of the positive financial results as well as the stable financial position, the Board of Directors will therefore propose to the Annual General Meeting on April 25, 2017, that it increase the dividend from capital contributions by one-third to CHF 2.00 per Feintool share.
Expansion of market capacity
With the goal of opening up further market segments and expanding production capacities in the European fineblanking business, Feintool is building a new plant in Most (Czech Republic). Thus, the company is fulfilling the customer desire for global suppliers that can master both basic and complex applications and are also close to the customer. The System Parts segment will develop its market position for production of simpler and less complex fineblanked components and for assembly production while Fineblanking Technology will focus on the manufacture of simple and medium-complexity fineblanking tools and spare parts. Production is planned to start mid 2018.
In addition, Feintool announced in February 2017 that it would acquire the Chinese forming plant founded in 2014 in Tianjin by the German Schuler Group. Existing orders are in the ramp-up phase; further investments and expansion are planned in the next two years. The acquisition allows Feintool to close the strategic loophole and now offer sophisticated forming applications in all important automotive markets, thus continuing to expand its market position.
Change in the Board of Directors
Dr. Kurt E. Stirnemann and Wolfgang Feil, who have been members of the Board of Directors for many years, will not stand for re-election at the General Meeting of April 25, 2017. As has already been announced, the election of Heinz Loosli, CEO of the Feintool Group between 2009 and 2016, as member will be proposed to the Board of Directors.
Feintool is generally expecting to develop positively in 2017, albeit in market conditions that are shaped by political uncertainty. Without the influence of the latest acquisition of the Chinese forming plant, we expect turnover of around CHF 580 m and an EBIT margin of 7.5% - 8%.
The key figures at a glance
in CHF m
in CHF m
|Change in %|
|Net sales of the Feintool Group||552.2||508.9||+8.5|
|Fineblanking Technology segment||92.7||87.8||+5.6|
|System Parts segment||479.3||438.0||+9.4|
|Earnings before interest, tax, depreciation and amortization (EBITDA) without one-off effect*||76.0||61.4||+23.7|
|Earnings before interest, tax, depreciation and amortization (EBITDA)||83.1||61.4||+35.2|
|Operating Profit (EBIT) without one-off effect*||41.3||32.9||+25.6|
|Fineblanking Technology segment||4.3||4.6||-5.6|
|System Parts segment||44.4||35.8||+23.9|
|Operating Profit (EBIT)||48.4||32.9||+47.2|
Expected Releases - high-volume parts manufacturing
|Orders received - third parties (investment goods)|
(Fineblanking Technology Segment)
|Orders backlog - third parties (Investment goods)|
(Fineblanking Technology Segment)
*In the reporting year, the Swiss pension fund adapted the regulations to the current general conditions (life expectancy, interest rate expectations, etc.). Thus, there is a one-off positive effect on the group result in the amount of CHF 7.1 m.
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For detailed information on Feintool's results for 2016, please visit http://www.feintool.com/en/company/investor-relations.html