Announcements

• Group revenue at EUR 1,803 billion; organic change of -0.9% at market level
• Adjusted EBIT at EUR 87.6 million, adjusted EBIT margin at 4.9%, further significant improvement in operating free cash flow, net financial liabilities scaled back to long-term low
• Continuity in dividend payment: proposal of EUR 0.15 per share
• Guidance for 2025: organic revenue roughly on a par with the previous year, adjusted EBIT margin of around 5%, operating free cash flow of approx. 1 to 3% of Group revenue
• CEO Thomas Jessulat: “Against the backdrop of difficult market conditions, we managed to bring the 2024 financial year to a successful conclusion. We were fully in line with our guidance, having recorded an adjusted EBIT margin of 4.9% and operating free cash flow of EUR 58 million. In addition, we succeeded in driving forward our transformation with a strategic package of measures."

ElringKlinger AG (ISIN DE0007856023 / WKN 785602) has published its definitive, audited results for the 2024 financial year as part of its 2024 annual report. Amid challenging conditions, the Group recorded Group revenue of EUR 1,803 billion in the financial year just ended (2023: EUR 1,847 billion) and was thus roughly in line with the market with an organic change of -0.9%. In this context, global light vehicle production fell by 1.1% in 2024, based on industry data from S&P Global Mobility. The adjusted EBIT margin amounted to 4.9% (2023: 5.4%), while operating free cash flow totaled EUR 58.4 million. The consolidated result was therefore in line with the annual targets of around 5% or slightly within positive territory. Earnings were adversely affected by the introduction of a strategic package of measures, which resulted in the Group recognizing non-cash impairment losses and restructuring expenses of EUR 238 million.

"Against the backdrop of difficult market conditions, we managed to bring the 2024 financial year to a successful conclusion. We were fully in line with our guidance, having recorded an adjusted EBIT margin of 4.9% and operating free cash flow of EUR 58 million. As a result, we were also able to scale back net financial liabilities to a 13-year low of EUR 246 million. At the same time, we succeeded in driving forward our transformation with a strategic package of measures focused on the goal set out in our SHAPE30 Group strategy: Our aim is to improve the Group's profitability and generate sustainable cash flow so that we can continue to respond to market requirements at all times as we move forward,” said Thomas Jessulat, CEO of ElringKlinger AG. “Our transformation is also reflected in revenue growth in the area of e-mobility. In the financial year just ended, we more than doubled revenue in the E-Mobility business unit to EUR 102 million."

Significant revenue growth in E-Mobility business unit

Within the strongest revenue-generating segment, Original Equipment, which saw a 5.4% decline in revenue against the backdrop of sluggish market momentum, the E-Mobility business unit recorded the most pronounced expansion at EUR 102.5 million (2023: EUR 48.3 million). The business unit more than doubled its revenue compared to the previous year, with a large-scale series production order for cell contacting systems making a significant contribution to growth. The Aftermarket segment, whose successful growth strategy continues to take effect, also recorded a strong year-on-year increase. In the financial year just ended, revenue was up 12.1% at EUR 336.3 million, compared to EUR 300.1 million in 2023. Despite weaker economic momentum, the Engineered Plastics segment proved robust in the reporting year, partly due to its broad industry mix. With revenue totaling EUR 130.0 million (2023: EUR 132.3 million), the segment was roughly on a par with the previous year.

Revenue growth in Germany and in the South America and Rest of the World region

In the region covering Germany, ElringKlinger recorded significant growth of 11.9%, taking the total to EUR 410.1 million (2023: EUR 366.3 million), due in part to the ramp-up of a high-volume order for cell contacting systems and revenue growth in the Aftermarket segment. The Group also recorded revenue growth in the region encompassing South America and the Rest of the World, posting an increase of 6.5% to EUR 103.3 million in 2024 (2023: EUR 97.1 million). Although the region covering the Rest of Europe saw a decline in revenue in the 2024 financial year in line with market developments, the Group slightly outperformed the market here with a change of -3.8%, taking the total to EUR 558.8 million (2023: EUR 580.9 million). The North America and Asia-Pacific regions declined.

Strategic package of measures to hone the Group's profile

In response to the transformation of the industry, the Management Board of the ElringKlinger Group has adopted a package of strategic measures aimed at honing the Group's profile to the largest extent possible. The purpose of these measures is to ensure that the Group is able to react to market requirements at all times as it moves forward. The emphasis is on profitable, forward-looking product groups and business units. In this context, ElringKlinger will no longer be pursuing its systems business for electric drive units in the future. The decision to sell the two plants in Sevelen, Switzerland, and Buford, GA, United States, was reached against the same background, as was the discontinuation of operations at the sites in Fremont, California, and Thale, Saxony-Anhalt, Germany. Overall, the aforementioned package of measures resulted in non-recurring exceptional items amounting to EUR 238 million. While these measures had a significant impact on the Group's earnings performance in 2024, they form the basis for achieving the goal of significantly improving the Group's profitability and cash flow, as set out in the SHAPE30 Group strategy.

Adjusted EBIT margin at target level

Despite the challenging conditions, the Group generated earnings before interest, taxes, depreciation, and amortization (EBITDA) of EUR 144.0 million (2023: EUR 200.3 million). Excluding the non-recurring items, adjusted EBITDA would have amounted to EUR 197.1 million (2023: EUR 213.5 million). Adjusted earnings before interest and taxes (adjusted EBIT) amounted to EUR 87.6 million (2023: EUR 100.1 million), which corresponds to an adjusted EBIT margin of 4.9% (2023: 5.4%). This resulted in a net loss attributable to shareholders of ElringKlinger AG for the period of EUR 137.8 million in 2024 (2023: net income of EUR 39.3 million).

Dividend proposal of EUR 0.15 per share

Due to the strategic package of measures, reported earnings per share were in negative territory at EUR minus 2.18 (2023: EUR 0.62). Excluding these exceptional factors, adjusted earnings per share amounted to EUR 0.70. In the opinion of ElringKlinger's management, this figure illustrates that the Group is well positioned from an operational perspective and, essentially, remains successful. On this basis, the Management Board, in consultation with the Supervisory Board, will propose to the upcoming Annual General Meeting that an unchanged dividend of EUR 0.15 (2023: EUR 0.15) per share be paid out in the interests of dividend continuity. In addition, the Supervisory Board approved the Management Board's proposal to hold the upcoming Annual General Meeting on May 16, 2025, in a virtual format.

Increase in operating free cash flow and low net debt-to-EBITDA ratio

In the 2024 financial year, operating free cash flow increased significantly compared to the previous year and amounted to EUR 58.4 million (2023: EUR 36.7 million). As a result, the Group was able to scale back its net financial liabilities by EUR 77.3 million to a long-term low of EUR 245.9 million (2023: EUR 323.2 million). This provides a solid foundation for the continued transformation of the Group. Accordingly, the net debt-to-EBITDA ratio is low at 1.7. Calculated on the basis of adjusted EBITDA, the figure stands at 1.2.

Guidance for 2025: organic revenue at prior-year level, adjusted EBIT margin of around 5%

Looking ahead to the current financial year, the global automotive industry will again be exposed to conflicting forces driven by geopolitical and trade policy developments as well as macroeconomic uncertainties. At the same time, the market is not evolving at a particularly dynamic pace, especially in Europe and North America.

Against this backdrop, ElringKlinger anticipates that organic revenue in 2025 will be roughly on a par with the previous year. In this context, the baseline is group revenue excluding that attributable to the two divested entities. The Group's medium term projection is for moderate revenue growth, taking into account market forecasts and based on its high-volume series production nominations. Despite a multitude of influencing factors, some of which may be considered detrimental, the Group is once again aiming for an adjusted EBIT margin of around 5%. The prerequisite for this is continued stringent cost management while preparations are made for the ramp-up of further series production nominations. In the medium term, the Group anticipates an adjusted EBIT margin of around 7 to 8%. Operating free cash flow is driven primarily by operating profitability, investments, and the development of net working capital. Based on the projections for these key performance indicators, the Group expects operating free cash flow to correspond to around 1 to 3% of Group revenue in 2025. In the medium term, this metric is expected to improve further; the Management Board is targeting a figure of around 2 to 4%. The target with regard to the net debt-to-EBITDA ratio is around 2 for 2025 and a range of 1.0 to 2.0 in the medium term.
 

Final, audited figures for FY2024 and Q4 2024

*For comparison purposes, excluding the order backlog of the two sold plants (Sevelen and Buford)
**Proposal to the 2025 Annual General Meeting

The 2024 annual report is available online at: https://ar2024.elringklinger.de

ElringKlinger AG / Preliminary announcement on the disclosure of financial statements
ElringKlinger AG: Preliminary announcement of the publication of financial reports according to Articles 114, 115, 117 of the WpHG [the German Securities Act]
28.02.2025 / 09:04 CET/CEST
Preliminary announcement of the publication of financial reports according to Articles 114, 115, 117 of the WpHG [the German Securities Act] transmitted by EQS News - a service of EQS Group.
The issuer is solely responsible for the content of this announcement.

28.02.2025 CET/CEST The EQS Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases.
Archive at www.eqs-news.com

EQS-News: ElringKlinger AG / Key word(s): Preliminary Results
ElringKlinger concludes 2024 financial year on a solid footing and specifies further transformation of the Group
27.02.2025 / 13:36 CET/CEST
The issuer is solely responsible for the content of this announcement.

PRESS RELEASE

• Preliminary, unaudited results for 2024:
  • Revenue at EUR 1,803 million (2023: EUR 1,847 million), organic revenue at EUR 1,831 million, adjusted EBIT margin at 4.8% (2023: 5.4%)
  • Strong operating free cash flow of EUR 58.5 million (2023: EUR 36.7 million)
  • Net financial liabilities at a thirteen-year low of EUR 250 million (2023: EUR 323 million)

• Strategic reorientation: focus on profitable business and discontinuation of loss-making activities. Management Board anticipates that this will unlock annual earnings potential of around EUR 10 million as from 2026.
• 2024 financial year severely impacted by non-recurring, non-cash impairment losses of EUR 238 million.
• CEO Thomas Jessulat: “In taking these measures, we are honing ElringKlinger’s profile in an effort to fortify the Group for further transformation amid challenging conditions. Our aim is to enhance the Group's profitability and improve cash flow for the long term."

ElringKlinger AG (ISIN DE0007856023 / WKN 785602) has published its preliminary and unaudited results for the 2024 financial year. On this basis, the Group generated revenue of EUR 1,803 million in 2024 (2023: EUR 1,847 million). Assuming stable exchange rates, revenue amounted to EUR 1,831 million. EBITDA totaled EUR 144 million (2023: EUR 200 million), while adjusted EBIT amounted to EUR 86.2 million (2023: EUR 100 million), which corresponds to an adjusted EBIT margin of 4.8% (2023: 5.4%). The Group thus met its October 2024 guidance of generating organic revenue slightly short of the previous year's level and posting an adjusted EBIT margin of around 5%. The Group had expected operating free cash flow to be just within positive territory but instead managed to exceed the target significantly at EUR 58.5 million (2023: EUR 36.7 million). As a result, it was in a position to scale back net financial liabilities substantially to EUR 250 million (2023: EUR 323 million). Consequently, its net debt-to-EBITDA ratio stood at 1.7 (Dec. 31, 2023: 1.6). After adjusting EBITDA for non-recurring items, primarily relating to the divestment of the two entities in the United States and Switzerland, the net debt-to-EBITDA ratio was 1.3 (Dec. 31, 2023: 1.5).

Commenting on the preliminary results, Thomas Jessulat, CEO of the ElringKlinger Group, said, “In this difficult environment, the Group posted financial results that were solid on the whole. Despite substantial investments in future-facing areas, we achieved strong operating free cash flow and were in a position to scale back net financial liabilities to their lowest level in thirteen years. By reducing debt, we have bolstered ElringKlinger's financing structure and established a solid foundation for the Group's ongoing transformation. Despite this, the underlying conditions are challenging and call for a clear, determined approach."

Strategic reorientation with a focus on profitable business

The Management Board has adopted a strategic package of measures for the purpose of ensuring that ElringKlinger can maintain a resilient position within a challenging economic and political climate, thus driving forward the Group's progressive transformation. A case in point is the discontinuation of the Group's system business for electric drive units. In future, the focus with regard to electric drive units will be on the profitable components business. Therefore, the Management Board has resolved to examine strategic options relating to its investment in hofer AG. In total, impairment losses recognized in respect of new drive technologies amount to EUR 85 million. In addition, the Group is reviewing its other shareholdings and will take further steps if necessary.

Sale of two plants completed

As of December 31, 2024, the Group effected the closing, i.e., the legal completion, of the sale of the two entities in Switzerland and the United States, for which an agreement had been signed in October. This divestment took place against the backdrop of the substantial investments required for the competitive continuation of business, which in turn would have restricted the Group in pursuing its chosen path of transformation. This transaction resulted in charges recognized in profit or loss with a total net effect of EUR 103 million, of which impairment losses of EUR 58 million had already been recognized in the preceding financial statements for the third quarter of 2024.

Reduction in the number of sites

Against the backdrop of the challenges faced by the global automotive industry, ElringKlinger is cutting the number of its sites and plans to discontinue operations not only at its plant in Thale, Germany, but also at its US site in Fremont, CA. Both plants are due to leave the Group in the middle of the year. In total, the Group recognized impairment losses of EUR 50 million relating to assets and restructuring expenses for these and further individual sites.

Annual earnings potential of around EUR 10 million from 2026

In total, non-cash impairment losses of EUR 238 million were recognized as part of the package as of the end of the 2024 reporting period. Based on these strategic measures, the Management Board expects to unlock earnings potential of around EUR 10 million per year from 2026, of which around EUR 7 million should materialize as early as 2025. ElringKlinger plans to publish audited figures and detailed information on its outlook for 2025 as part of its annual report on March 27, 2025.

Asked to comment, CEO Thomas Jessulat said, "By taking these steps in line with our SHAPE30 transformation strategy, we are looking to further hone ElringKlinger's profile. Our aim is to enhance the Group's profitability and improve cash flow for the long term. To this end, we are concentrating our product portfolio and deploying our resources in a targeted manner to achieve growth in our chosen fields of the future. Our substantial backlog of nominations, with the ramp-up of high-volume series production orders, forms the basis for this."

Further ramp-up for e-mobility applications

The continued ramp-up of large-scale production projects is an important cornerstone of ElringKlinger's transformation. Based on a strong portfolio of nominations in the billion euro range, revenue in the OE segment is expected to grow further, particularly for e-mobility applications. The E-Mobility business unit is scheduled to break even in 2027. In the 2024 financial year, revenue generated by this business unit more than doubled to EUR 103 million (2023: EUR 48.3 million). Alongside the current large-scale series production order relating to a global battery manufacturer, a high-volume order for cell contact systems for the BMW Group's New Class is also due to ramp up in the current year.

Preliminary, unaudited figures for FY2024 and Q4 2024

About ElringKlinger  

As an independent supplier operating worldwide, the ElringKlinger Group has established itself as a powerful and trusted partner to the automotive industry – acknowledged for its exceptional depth of expertise. Our product portfolio encompasses innovative solutions for passenger cars and commercial vehicles powered by electric motors, hybrid technology, or combustion engines. Alongside the powertrain, other areas of application include the underbody, chassis, braking system, interior, and vehicle body. We were among the frontrunners when it came to positioning ourselves as a specialist in the field of e-mobility – with pioneering battery and fuel cell technology, and associated components and assemblies, such as plastic housings, and punched and formed metal parts.

Customized lightweight components engineered by ElringKlinger can be used throughout the entire vehicle; they deliver tangible benefits in terms of weight reduction, efficiency, and functional integration, especially in e-mobility applications.

Additionally, we serve the aftermarket in more than 140 countries with an extensive range of spare parts.

These efforts are supported by a dedicated workforce of more than 9,000 people employed within the ElringKlinger Group. Operating at more than 40 sites worldwide, ElringKlinger has established a global presence and is closely aligned with its customers in all major automotive regions.

Legal notice

This release contains forward-looking statements. These statements are based on the expectations, market assessments, and forecasts of the Management Board and the information currently available to it. These forward-looking statements shall, in particular, not be construed as guarantees of future developments and results referred to therein. Although the Management Board is of the firm opinion that the statements made and their underlying beliefs and expectations are realistic, they are based on assumptions that may prove to be incorrect. Future results and developments depend on a variety of factors, risks, and uncertainties that may lead to changes in the expectations and judgments that have been expressed. These factors include, for example, changes in general economic and business conditions, fluctuations in exchange rates and interest rates, lack of acceptance of new products and services, and changes in business strategy.

27.02.2025 CET/CEST Dissemination of a Corporate News, transmitted by EQS News - a service of EQS Group.
The issuer is solely responsible for the content of this announcement.

The EQS Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases.
Archive at www.eqs-news.com