POLYTEC GROUP - Results 3. quarter 2019

• Group sales revenues in the first nine months 2019 fell by 1.8% to EUR 470.3 million
• EBITDA amounted to EUR 47.8 million, EBITDA margin 10.2%
• EBIT totalled EUR 22.2 million, EBIT margin 4.7%
• Earnings after tax reached EUR 14.1 million
• Earnings per share EUR 0.62
• Equity ratio was 1.4 percentage points down at 41.3%, as compared to 31.12.2018
   

In the first three quarters of 2019, consolidated POLYTEC GROUP sales declined by 1.8% to total EUR 470.3 million (Q1-Q3 2018: EUR 478.7 million). The initial consolidation of the newly founded POLYTEC CAR STYLING Weierbach GmbH, which will continue to operate the automotive business activities of the insolvent Wayand AG, took place on 1 September 2019. The group’s consolidated sales revenues thus contain EUR 7.2 million generated by the new company. For several quarters, the material changes within the automotive industry have impacted POLYTEC’s core business, causing reductions in call-offs and sales revenue losses in the passenger car market area. However, during the third quarter, products in this segment showed slight growth, albeit on the basis of the poor figures for the previous year.

As compared to the preceding year, during the third quarter of 2019 the commercial vehicles area, which in the preceding periods developed in a positive manner for the POLYTEC GROUP, had to accept a marked decline in sales revenues. By contrast, as opposed to the weak level of the same period of the previous year, the non-automotive market area demonstrated pleasing growth.

In comparison to the same period of the previous year, sales revenues in the passenger car market area, which include EUR 7.2 million from the newly founded POLYTEC CAR STYLING Weierbach GmbH, fell by around 4.8% to EUR 285.5 million. Nevertheless, this area still represents the strongest within the POLYTEC GROUP with a 60.7% (Q1-Q3 2018: 62.7%) share of total sales. As compared to the period from January to September 2018, sales in the commercial vehicles market area (27.0%, Q1-Q3 2018: 26.9%) declined slightly, falling from EUR 129.0 million to EUR 126.9 million, or 1.6%. In the current nine months, the share of the non-automotive market area in POLYTEC’s consolidated sales revenues increased markedly, rising from 10.4% to 12.3%, although the basis for this figure was provided by a reduction in call-offs from one major customer during the same period of last year.

In the first nine months of 2019, POLYTEC GROUP EBITDA amounted to EUR 47.8 million. As compared to the 10.4% of the same period of the previous year, the EBITDA margin was down by 0.2 percentage points at 10.2%. In the period from January to September 2019, Group EBIT totalled EUR 22.2 million. As compared to the same period of 2018, the EBIT margin fell by 1.7 percentage points from 6.4% to 4.7%.

The financial result for the first nine months of 2019 amounted to minus EUR 2.9 million. Consequently, earnings after tax totalled EUR 14.1 million (Q1-Q3 2018: EUR 22.2 million), which corresponded with earnings per share of EUR 0.62.

As compared to 31 December 2018, on 30 September 2019, the group’s balance sheet total was EUR 33.0 million higher at EUR 590.6 million. This increase can be traced primarily to an investment ratio, which was above that of depreciation, as well as a tangible rise in the volume of working capital committed to tooling and engineering projects. Equally, the initial adoption of accounting and evaluation methods in line with IFRS 16 Leases also exerted an influence upon the balance sheet, as since 1 January 2019 it must disclose right-of-use assets and leasing liabilities.

The equity ratio as at 30 September 2019 was 1.4 percentage points lower than the figure for the 31 December 2018 reporting date at 41.3%. Among other factors, owing to the new IFRS 16 standard and a significant increase in the committed net working capital (in particular for tooling and engineering projects), as compared to the 31 December 2018 reporting date, net financial debt was EUR 61.5 million higher at EUR 163.3 million.

Outlook
From a current perspective, the POLYTEC executive management anticipates that including the consolidation of Polytec Car Styling Weierbach on 1 September 2019, group sales revenues in the 2019 financial year will amount to approximately EUR 650 million and EBIT will probably total around EUR 35 million. The fulfilment of these forecasts will depend largely upon the success of final negotiations concerning outstanding claims against customers. This result outlook also includes positive, one-off effects from capacity adjustments, but serious effects emanating from Brexit, global trade barriers, or political and geopolitical events were omitted.

Link:     Interim Report Q3 2019

All other reports of POLYTEC Holding AG see  Publications

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