Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on ELRINGKLINGER AG. We currently have 11 research reports from 1 professional analysts.
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Good cash generation, but poor Q3 profit numbers
08 Nov 16
The group showed Q3 revenue growth of 2.2% to €374m which brought the ytd number to €1.15bn, an increase of 3.0%. However, profits continued falling. EBIT was down by 12% to €31m in the last quarter and 11% to €97m ytd. As net financial expenses fell from €5.6m to €3.6m in Q3, net earnings fell by only 4% to €19.9m. However, net financial expenses were up by €4m ytd and this resulted in a net profit fall of 15% to €58.8m. Our 9M revenue expectation was €10m higher and EBIT and net earnings were €8m and €6m higher. On the other hand, cash from operations (based on management’s definition) of €46m (+42%) was the highest Q3 number in recent years and the same is true for the €118m (+29%) for the 9M.
Expanding into engineering
27 Oct 16
ElringKlinger has acquired a 27% stake in Hofer AG, combined with a 53% stake in its subsidiary Hofer Powertrain Products GmbH. The purchase price has not been released but indications are in the double-digit million euro range. The deal is expected to be closed early next year, after which Hofer Powertrain will be fully consolidated.
The rather poor profit development has continued in Q2
04 Aug 16
Management had indicated earlier that profits had continued to fall in the last quarter. In fact, the final H1 numbers show a revenue increase of 3.3% to €776m, but EBIT was down by 10% to €66m and net earnings by almost 20% to slightly less than €40m.
Profit warning for 2016
22 Jul 16
ElringKlinger is due to release final H1 numbers on 4 August but it has given some indications this morning. Revenue increased by 3.3% to €776m (we had expected €784m), while EBIT before PPA fell by 11% to €68m. The stated EBIT number is €66m, 10.4% lower than a year ago. We had expected €76m. As a consequence of the above, management now sees the full-year EBIT before PPA coming in at between €140m and €150m instead of €160-170m. We had been much more cautious in the first place and expected an EBIT number of €147m for 2016. Consequently, we are unlikely to change our projections significantly once the half-year report is released.
ElringKlinger moves towards mass-volume, low-margin production
07 Jun 16
The company has published a press release (see below) which indicates that it intends to become an ‘extended workbench’. The technology for the components it will deliver to a first-tier car component supplier (Brose) has been developed by this client and ElringKlinger will be the producer in two existing factories (in Hungary and Mexico) and in one new plant (in China). As ElringKlinger has neither developed the technology nor supplies the OEM directly, we believe that this is a low-margin business. The press release: ElringKlinger has received a high-volume serial-production order from German automotive supplier Brose. The contract covers the supply of door module carriers made of organo sheets, which are to be fitted to compact-class vehicles manufactured by a global car maker. Running until the year 2024, the order is worth more than €100m in total. Production in Europe is scheduled to commence in Hungary at the end of 2017, which will be followed by the start of serial production in China and Mexico in 2018. While the production sites in Hungary and Mexico are to be expanded, a new plant is to be established in China. “This large-scale contract bears testimony to our research efforts with innovative fibre-reinforced composites and illustrates our expertise in the field of lightweight components,” said Dr Stefan Wolf, CEO of ElringKlinger. ElringKlinger’s door module carriers are another structural component within the product portfolio for use in the vehicle body. “By becoming increasingly independent of drive systems, we are establishing the strongest possible foundation for the future,” explained Dr Wolf. In securing this contract, ElringKlinger has shown its determination to pursue a strategy aimed at contributing to the reduction of vehicle fuel consumption and emissions through intelligent lightweight solutions. Among other things, the innovative door module carrier helps to reduce the overall weight of vehicle doors. Their production involves forming extremely light and stable fibre-reinforced composites – so-called organo sheets – and injection-moulding plastic elements onto the parts for additional component functions – in a single step. The technology applied in this field was developed by Brose. ElringKlinger is the strategic partner for execution at an industrial level.
Sales slightly up but profits sharply lower than expected
04 May 16
ElringKlinger’s Q1 revenue number was up by 4% to €385m but EBIT fell by 13% to €31m and net earnings by 39% to €17.2m. All these numbers are below our expectations of €389m, €40m, and €27m. €2.6m of the profit disappointment is the consequence of Management Board member Schmauder having left the company in February. In addition, production bottlenecks have cost another €7m.
09 Dec 16
Ideagen* (IDEA): Acquisition of IPI Solutions (CORP) | Lombard Risk Management* (LRM): Atos deal improves routes to German market (CORP) | Photo-Me* (PHTM): Upgrade to FY forecasts (CORP) In other news… Frontier Developments* (FDEV): ED coming to Xbox and Planet Coaster update (CORP) | LiDCO* (LID): Analyst interview (CORP) | Rude Health: Analyst interview
Civil: No Reflation here, only a Race to the Bottom
05 Dec 16
The strengthening of the US dollar since the election of Trump is adding to the headwinds in the airline industry: over-capacity and falling yields. The airline industry, which is expected to generate $8bn of free cashflow in 2016 on $600bn of capital employed, needs to spend $120bn annually to maintain current delivery rates. Deferrals and down-gauging is now spreading to narrow-bodies as more and more airlines review their capex plans. We expect acceleration of seat densification as airlines look to sweat their existing fleets. We now expect deliveries to fall by 5% over 2015-18 as opposed to our previous forecast of flat growth. Aftermarket may also suffer as seat densification helps cut number of flights. This leads to reduction in our EPS forecasts for key Civil Aerospace names: Rolls-Royce, Meggitt, GKN and Senior.
Product quality and management depth
07 Dec 16
Yesterday Focusrite held a capital markets day, designed to showcase the range and quality of products and introduce operational management, which shares a passion for music-making and has deep knowledge of the products. This contributes to excellent product support, software innovation and thus customer loyalty, which should sustain the company’s brand leadership.
Small Cap Breakfast
07 Dec 16
Creo Medical group—Schedule 1 update.. £20m raise. Expected market cap £61.2m, admission expected 9 December. ECSC—Schedule 1 from provider of cyber security services. Raising £5m. Vendor sale £0.8m. Target date 14 Dec. Expected market cap £15m. RM Secured Direct Lending - The secured direct lending fund intends to float on the Main Market on 15 December raising up to £100m