ElringKlinger AG: Preliminary financial results for FY 2013 characterized - Adverse foreign exchange effects

ElringKlinger AG  / Key word(s): Preliminary Results20.01.2014 18:40Dissemination of an Ad hoc announcement according to § 15 WpHG, transmittedby DGAP - a company of EQS Group AG.The issuer is solely responsible for the content of this announcement.---------------------------------------------------------------------------ElringKlinger AG: Preliminary financial results for FY 2013 characterizedby one-time effects - Adverse foreign exchange effects  - Projected one-time gain of EUR 16-18 million following assumption of    control of Japanese joint venture  - Revenue for 2013 up 4.3%; organic growth of 6.1%  - EBIT estimated at EUR 160-162 million; adjusted EBIT expected to be    around EUR 146 million  - Outlook 2014: Revenue growth of 7-9% (5-7% organically),    adjusted EBIT expected to rise to EUR 160-165 millionDettingen/Erms (Germany), January 20, 2014 +++ Automotive supplierElringKlinger will generate a one-time gain of an estimated EUR 16-18million having assumed control of the 50:50 joint venture ElringKlingerMarusan Corporation effective from December 31, 2013. This item will beincluded in its operating result for the 2013 financial year.Based on preliminary key financials, the ElringKlinger Group achieved salesrevenue of EUR 1,176.2 (1,127.2) million. Revenue growth was impacted bythe strength of the euro and came in at 4.3%. Organically, i.e. taking intoaccount the effects of foreign currency translation, revenue increased by6.1% despite the extreme weakness of European vehicle markets and adownturn in new car registrations in Russia, Brazil and India.The marked appreciation of the euro, especially in the second half of 2013,also had an impact on earnings before interest and taxes (EBIT), which inthe case of ElringKlinger's business include foreign exchange effects. Theautomotive supplier anticipates that EBIT will amount to EUR 160-162(136.0) million in total. This figure includes the estimated one-time gainof EUR 16-18 million mentioned above. Adjusted for non-recurring items,EBIT rose by around 7% to approx. EUR 146 (136.0) million in 2013, based onpreliminary figures. This was roughly 3% below the original target of atleast EUR 150 million.In 2013, one-off restructuring charges attributable to the French site inNantiat (EUR 1.8 million) as well as exceptional expenses associated withefforts to further penetrate the aftermarket sector (EUR 1.5 million)exerted some downward pressure on earnings. By contrast, the one-off gainfrom the step acquisition of Korean joint venture ElringKlinger Korea Co.,Ltd. (EUR 1.4 million) and, as outlined above, the effects associated withthe assumption of control of ElringKlinger Marusan Corporation (EUR 16-18million) had a positive impact.The adjusted EBIT margin thus improved slightly, up from 12.1% in theprevious year. The company's operating result, which unlike EBIT containsno foreign exchange effects, will be visibly higher.Control obtained over ElringKlinger Marusan as part of expansion in AsiaElringKlinger concluded a contractual agreement with its joint venturepartner as regards the exercise of control over the 50:50 joint ventureElringKlinger Marusan Corporation. As of December 31, 2013, ElringKlingerAG thus has economic control over the Marusan Group. Under IFRS, theassumption of control necessitates full inclusion of the entity within thescope of consolidation of the ElringKlinger Group. As outlined above, thistransition will produce a one-time gain of an estimated EUR 16-18 millionfor 2013. There was no effect on sales in 2013.Having previously been included in the Group's scope of consolidation at aproportionate rate of 50%, the joint venture is to be fully consolidated asfrom 2014. As a result, Group sales revenue will increase by around EUR 25million in 2014 compared to the preceding financial year, while earningsbefore taxes will expand by approx. EUR 1.5 million year on year.Write-downs of intangible assets resulting from purchase price allocationand amounting to an estimated figure of around EUR 1.5 million will have acontrary effect in 2014.The Japanese joint venture is of particular importance to the Asianstrategy adopted by the ElringKlinger Group, especially in the rapidlyexpanding ASEAN region. Including exports, the ElringKlinger Group alreadygenerates more than 20% of its revenue within the Original Equipmentsegment in Asia, a trend that is rising. The Group saw another significantincrease in the number of ongoing development contracts with Asianmanufacturers in 2013.Further revenue and earnings growth expected for 2014 Based on the assumption that global car production will expand by 2 to 3%,the ElringKlinger Group anticipates that its revenue will grow by 5 to 7%organically in 2014, thus outpacing the market as a whole. Fullconsolidation of ElringKlinger Marusan Corporation will additionallycontribute around EUR 25 million in sales. The Group's EBIT margin isexpected to improve slightly compared to 2013. Adjusted for non-recurringitems, EBIT is to rise for the fifth consecutive year, reaching a level ofEUR 160 to 165 (around 146) million.The full announcement of the final, audited results for fiscal 2013 isscheduled for March 28, 2014.20.01.2014 DGAP's Distribution Services include Regulatory Announcements,Financial/Corporate News and Press Releases.Media archive at www.dgap-medientreff.de and www.dgap.de--------------------------------------------------------------------------- Language:     EnglishCompany:      ElringKlinger AG              Max-Eyth-Straße 2              72581 Dettingen/Erms              GermanyPhone:        071 23 / 724-0Fax:          071 23 / 724-9006E-mail:       stephan.haas@elringklinger.deInternet:     www.elringklinger.deISIN:         DE0007856023WKN:          785602Indices:      MDAXListed:       Regulierter Markt in Frankfurt (Prime Standard), Stuttgart;              Freiverkehr in Berlin, Düsseldorf, Hamburg, Hannover, München End of Announcement                             DGAP News-Service ---------------------------------------------------------------------------