Schaeffler Group starts 2022 with 3.7 billion Euro revenue in first quarter

Global automotive and industrial supplier Schaeffler published its interim statement for the first three months of 2022 today. The Schaeffler Group’s revenue for the reporting period amounted to 3,758 million euros (prior year: 3,560 million euros).

While Automotive Technologies division revenue declined by 3.2 percent at constant currency, the Industrial division increased its revenue by 15.7 percent at constant currency. Automotive Aftermarket division revenue grew by 2.1 percent at constant currency.

The Schaeffler Group generated 258 million euros (prior year: 397 million euros) in EBIT before special items for the first three months, resulting in an EBIT margin before special items of 6.9 percent (prior year: 11.2 percent).

EBIT for the reporting period was adversely affected by 11 million euros (prior year: 15 million euros) in special items. EBIT amounted to 247 million euros (prior year: 382 million euros).

Automotive Technologies: 2 billion euros in order intake in E-Mobility BD
The Automotive Technologies division generated 2,293 million euros in revenue (prior year: 2,281 million euros) for the first three months. At constant currency, revenue decreased by 3.2 percent from the prior year. Besides the high base of comparison the decrease was primarily attributable to the persistently challenging environment in the automotive sector, with the decline in global automobile production caused by the sustained semiconductor shortages, the implications of the coronavirus pandemic, and the war in Ukraine resulting in decreasing customers’ call-offs.

The division outperformed global automobile production of passenger cars and light commercial vehicles by 1.3 percentage points. The division’s order intake was driven by 2.0 billion euros for BEV system applications in the E Mobility business division (BD), which has thus already reached the lower end of the full-year target range (2.0 to 3.0 billion euros). The other business received a further 1.6 billion euros in orders for the division.

Additionally, the E-Mobility BD generated the highest year-on-year revenue growth rate of 18.4 percent at constant currency. The Engine & Transmission Systems and Bearings BDs experienced constant-currency revenue declines of 5.9 and 7.6 percent, respectively. The Chassis Systems BD expanded by 11.6 percent at constant currency.

While revenue changed only slightly in the Europe and Americas regions, which reported constant-currency growth of -1.9 and 0.3 percent, respectively, Greater China region revenue declined by 5.3 percent at constant-currency due to the still strained situation resulting from the coronavirus pandemic. The Asia/Pacific region reported a revenue decline of 8.3 percent at constant-currency.

The division earned 80 million euros (prior year: 240 million euros) in EBIT before special items in the first quarter. The EBIT margin before special items for the reporting period was 3.5 percent, considerably below the extraordinarily strong prior year level of 10.5 percent. The main reason for this decrease were significantly higher input costs that were only partially offset by adjustments to sales prices in the first quarter, as had been expected.

Automotive Aftermarket: EBIT margin before special items at 13.6 percent thanks to favorable one off items
The Automotive Aftermarket division reported 463 million euros (prior year: 444 million euros) in revenue for the reporting period, representing constant-currency revenue growth of 2.1 percent. This growth was mainly attributable to a favorable impact from sales prices.

Revenue grew considerably in all regions except Europe – the region generating the highest revenue – where revenue was down slightly, declining by 2.0 percent at constant currency partly due to missed sales in Russia and Ukraine toward the end of the first quarter. The Americas and Asia/Pacific regions expanded their Independent Aftermarket business in particular, providing these regions with constant-currency growth rates of 11.3 and 15.6 percent, respectively. The 9.8 percent constant-currency revenue increase in the Greater China region was mainly due to strong growth in e commerce business.

These developments resulted in EBIT before special items of 63 million euros (prior year: 58 million euros). This represents an EBIT margin before special items of 13.6 percent (prior year: 13.1 percent). The slight increase from the prior year is primarily attributable to favorable one-off items. Increased input costs that were not fully compensated for by price adjustments had an offsetting effect.

Industrial: 15.7 percent constant-currency growth in first quarter
The Industrial division reported 1,002 million euros (prior year: 836 million euros) in first-quarter revenue, posting a very strong constant-currency revenue growth of 15.7 percent.

Reporting a constant-currency increase of 26.2 percent, the Europe region generated very strong volume-driven growth, and the Americas and Asia/Pacific regions similarly generated considerable constant-currency revenue growth rates of 11.0 and 22.7 percent, respectively. The Greater China region experienced a heterogeneous trend resulting in a slight constant-currency revenue decline of 0.3 percent overall. Sales prices led to overall revenue increases at the Industrial division as well, as higher input costs were partly passed on to the market.

Although the Industrial division was impacted by significantly higher input costs as well, it earned 115 million euros (prior year: 98 million euros) in EBIT before special items in the first three months. This represents an EBIT margin before special items of 11.4 percent (prior year: 11.8 percent).

Positive free cash flow
Due to lower EBITDA and an increase in working capital, first-quarter free cash flow before cash in- and outflows for M&A activities totaled 14 million euros (prior year: 130 million euros). Free cash flow conversion was 0.1, and the reinvestment rate for the first three months amounted to 0.56.

Net income attributable to shareholders before special items decreased during the first three months of 2022 compared to the prior year period, amounting to 144 million euros (prior year: 247 million euros). Net income attributable to shareholders was 136 million euros (prior year: 235 million euros), representing earnings per common non-voting share of 0.21 euros (prior year: 0.35 euros).

The group’s net financial debt amounted to 1,992 million euros as at March 31, 2022. The net debt to EBITDA ratio was 1.0x as at the end of March 2022 (end of December 2021: 0.9x). The gearing ratio, i.e. the ratio of net financial debt to shareholders’ equity, decreased to approximately 54.4 percent (December 31, 2021: approximately 61.7 percent). The group employed a workforce of 83,089 as at the March 31, 2022, reporting date.

Claus Bauer, CFO of Schaeffler AG, said: “The Schaeffler Group has once again demonstrated its resilience in the first quarter of 2022 and responded flexibly to the challenging environment. With our broad portfolio and our robust balance sheet structure, we can cope with the more complex external headwinds, while continuing to invest in our business and especially in our growth segments.”