Feintool's net sales and EBIT grow at double-digit rates
In the first half of 2018, the technology company increased its net sales by 13.6 percent year-on-year to CHF 337.3 million. In local currency, organic growth amounts to 7.3%. The operating earnings (EBIT) in the same period increased by 14.4% to CHF 25.7 million. Feintool also expects to see positive business development for the year as a whole.
For Feintool, the long-term strategy, with its focus on fineblanking and forming combined with consistent internationalization and technical innovation, has once again proven its worth. In addition, Feintool is investing in the growth market of electrification and expanding its strategic business fields into the market for electric motor components.
Dynamic market environment
The growth of the global automotive industry continued in 2018. According to estimates 1, global car production increased by 2.5% year-on-year. Feintool benefited from this positive industry trend and grew – despite challenging general conditions –, outpacing the market in every relevant region.
Positive business development
During the period under review, the Feintool Group generated net sales of CHF 337.3 million, which corresponds to an increase of 13.6%. Adjusted for currency and acquisition effects, the company achieved growth of 7.3%. EBITDA increased by CHF 5.4 million to 45.4 million in the first six months of the year and operating earnings (EBIT) by 14.4% – or by 10.9% in local currency – to CHF 25.7 million. This corresponds to an unchanged EBIT margin of 7.6 %. The Group result amounted to CHF 16.9 million (previous year CHF 14.0 million) and thus increased – adjusted for currency effects – by 19.8%.
1 LMC Automotive.
Parts production a growth driver both in Europe and increasingly China
Of all the corporate divisions, the System Parts segment, in which Feintool is globally active with the high-volume production of precision fineblanked and formed components, accounted for the largest share of sales. During the first half of the year, the segment grew by 7.3% to CHF 295.2 million in local currency, generating 87.3% of the consolidated sales.
Once again, all regions have grown. Europe (+ 6.6% in local currency) is driven by increased sales volumes of new products. Asia (+ 27.1% in local currency) is benefiting on the one hand from the acquisition in the previous year, and on the other from steadily increasing releases from our customers. Despite a stagnating market, Feintool was still able to grow by 2.2% (in local currency) in North America. However, part of this increase is due to higher steel prices. Europe contributed 57.7% to sales in the parts area, while the US share was 31.1%, and that of Asia 11.2%.
In the Fineblanking Technology segment, in which Feintool offers comprehensive technological solutions for fineblanking, net sales increased by an encouraging 43.7% to CHF 53.3 million. With excellent sales of press systems, the segment posted its highest net sales and number of new orders in eight years in the first half of 2018.
Feintool expects the positive business development to continue in the second half of financial year 2018, albeit in a market environment characterized by political uncertainties and by the waste gas measuring cycle. Overall – taking into account the acquisition of Stanz- und LaserTechnik Jessen GmbH – we expect to see net sales of between CHF 670 million and CHF 700 million and an EBIT margin similar to that of the first half of 2018.
Overview of key financial indicators
Change in lcal currency
|Jan. - June 30, 2018 CHF millions|| |
Jan. 1 - June 30, 2017 CHF millions
|Net revenue ||10.3||13.6||337.3||296.8|
|Operating earnings (EBIT)||10.9||14.4||25.7||22.5|
|Group result ||19.8||20.3||16.9||14.0|
|Free cash flow||-25.2 ||-47.4|
|Shareholder's equity |
(comparison period endig Dec. 31, 2017)
|Fineblanking Technology segment||43.7||43.7||53.3||37.1|
|System Parts segment||7.3||11.0||295.2||266.0|
|Consolidated Feintool Group total||10.3||13.6||337.3||296.8|
|Orders received investment goods||17.4||17.4||57.9||49.3|
|Orders backlog investment goods||-0.5||0.0||47.2||47.2|
|Expected releases – high-volume parts production||18.7||24.0||295.9||238.6|
Change in local currency
|Apr. 1 - June 30, 2018 CHF millions||Jan. 1 - June 30, 2018 CHF millions|
|Fineblanking Technology segment||53.7||53.9||30.7||20.0|
|System Parts segment||7.8||12.6||150.3||133.4|
|Consolidated Feintool Group total||11.8||16.0||176.0||151.8|
|Orders received investment goods||27.0||27.4||28.6||22.4|
1 compared to the same period in the previous year