Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on ELRINGKLINGER AG. We currently have 13 research reports from 1 professional analysts.
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Change on the Supervisory Board
24 Mar 17
Walter H Lechler, the Chairman of the Supervisory Board, steps down at the upcoming AGM on 16 May. The Lechler family controls the majority of ElringKlinger’s shares. Lechler is turning 75 years in 2017 and this is the limit a Board member can be active. With him leaving the Board, the family continues to be represented, but only indirectly via Manfred Strauss, the General Manager of another Lechler company. However, the Board will no longer be headed by a family member but by Klaus Eberhardt, a Board member since 2013 and the former Rheinmetall CEO. Whether this change will eventually result in the family reducing its stake remains to be seen.
Q4 16 profit was surprisingly strong, at first glance
28 Feb 17
ElringKlinger’s revenue increased by 4.4% to €407m in the last quarter (+3.3% to €1.56bn in the full-year) while EBIT recovered by almost 50% to €38.4m (+0.3% to €136m in 2016). While the sales number is in line with our projection, operating earnings are some €10m higher. Except for these two numbers, management has not given any further information and no guidance for 2017. Final accounts are due on 30 March.
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.
Outperformance in the bag
24 Mar 17
IG Design has had a very good second half trading and has issued a year-end update indicating that numbers will exceed market estimates. We have lifted our FY17 and FY18 numbers by 8-10% at the pre-tax and EPS levels, following an 11% uplift to earnings with the interims. Particularly notable is the comment on strong cash flow, with the group reaching its target of average leverage less than 2.5x EBITDA two years ahead of plan. With the earnings and cash flow momentum, strong balance sheet and progressive dividend, there is good potential for further share price upside.
24 Mar 17
We note the share transaction yesterday, and think the stock will benefit from the increased liquidity. We continue to believe there is good valuation upside to the shares. However, we are terminating coverage of Watkins Jones from this morning and withdrawing our forecasts from the market.
Management hopes for a better 2017
21 Mar 17
BMW’s final 2016 accounts were, compared to what we had anticipated, slightly disappointing. We had said so when preliminary numbers were released earlier this month. Today’s guidance for 2017 shows slight growth in all categories, i.e. volume, revenue and consolidated pre-tax earnings are all projected to go up. Reading between the lines, the statement suggests that the EBIT margin generated by the Automobiles division is likely to fall further (it was down from 9.2% to 8.9% in 2016). Whether Financial Services can again increase its margin (it was up by 0.1pp to 8.4% last year) remains to be seen and will also depend on the price development of used vehicles.
The Slide Rule
12 Jan 17
What is The Slide Rule? The Slide Rule has been designed to dramatically simplify the identification of the best companies in the UK small/mid-cap sector by making a quantitative assessment of the relative potential of each company. At its core, The Slide Rule aims to identify those companies that create genuine shareholder value through strong returns on capital and solid growth, but also present a value opportunity with the potential tailwind of earnings momentum. Companies are assessed within a Quality, Value, Growth and Momentum (QVGM) framework.