Global automotive and industrial supplier Schaeffler presented its interim report for the first three months of 2020 today. The Schaeffler Group’s revenue for the reporting period amounts to 3,282 million euros (prior year: 3,622 million euros). At constant currency, revenue for the period decreased by 9.2 percent, mainly driven by volumes. Revenue declined in all four regions during the first quarter. The decrease at constant currency amounted to 11.2 percent in the Greater China region, 10.4 percent in Europe, 9.3 percent in Asia/Pacific, and 6 percent in the Americas region.
The Schaeffler Group generated 215 million euros (prior year: 272 million euros) in EBIT before special items for the first three months, representing an EBIT margin before special items of 6.5 percent (prior year: 7.5 percent). The decline from the prior year was primarily attributable to the decrease in gross margin. The margin decrease was mainly driven by the adverse impact of volumes on fixed costs.
EBIT for the reporting period was adversely affected by 302 million euros (prior year: 42 million euros) in special items. These included an impairment of goodwill allocated to the Automotive OEM division by EUR 249 million, since the coronavirus pandemic has led to increased uncertainty regarding the development of Schaeffler Group’s business going forward. Special items additionally comprise 53 million euros in expenses incurred to expand the programs RACE and FIT, especially in connection with reducing headcount. The resulting EBIT amounted to 88 million euros (prior year: +230 million euros).
Automotive OEM revenue down 12 percent, Q1 outperformance 11 percentage points
The Automotive OEM division generated 2,008 million euros in revenue (prior year: 2,285 million euros) for the first three months. At constant currency, revenue decreased by 12 percent from the prior year, mainly driven by volumes. The drop in revenue was primarily caused by the impact of the coronavirus pandemic, which considerably weakened automotive sector demand, lowering Automotive OEM division demand as well. Global automobile production for the first quarter was significantly affected by temporary production shutdowns and declined by 23 percent in the first three months of 2020. Automotive OEM division outperformance was a considerable 11 percentage points on that basis.
As a result of the coronavirus crisis, revenue declined in all four regions. In the Europe region, revenue fell by 13.5 percent at constant currency. The Americas region reported 5.2 percent less revenue at constant currency. The constant-currency revenue decline in the Greater China region was 22.8 percent. In the Asia/Pacific region, revenue was down 7.3 percent at constant currency.
The Schaeffler Group earned 50 million euros (prior year: 113 million euros) in EBIT before special items in the first quarter. This resulted in an EBIT margin before special items of 2.5 percent for the period, significantly less than the 4.9 percent EBIT margin reported in the prior year. The decline was primarily attributable to the lower gross margin that resulted from the adverse impact of volumes on fixed costs.
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SOURCE: Schaeffler
