SAF-Holland S.A., a supplier to the global truck and trailer industry, said it has recorded a significant increase in sales and earnings for the first nine months of the fiscal year. Sales climbed to EUR 171.7 million (previous year: EUR 103.1 million) in the third quarter and adjusted EBIT rose to EUR 11.4 million (previous year: EUR 2.5 million). In the first nine months, the group generated sales of EUR 459.2 million, corresponding to growth of 45.1% while adjusted EBIT increased to EUR 26.0 million (previous year: EUR 1.2 million).
CEO Rudi Ludwig said, “The SAF-Holland Group made significant progress in the third quarter. We will even achieve some of our objectives sooner than expected. Of course, increasing global demand has helped but, most importantly, the corporate strategy we have adopted has been affirmed. The restructuring measures of the last two years are clearly showing their impact. Our company is lean and strong and we are internationally positioned with good growth potential in all our core markets.”
All three business units contributed to the sales increase to EUR 459.2 million (previous year: EUR 316.4 million), with the trailer area showing increasing recovery compared to the truck area. The Group generated 48.1% of its sales in Europe (previous year: 47.2%), 45.4% in North America (previous year: 47.3%) and 6.5% in other regions (previous year: 5.5%). The gross margin improved to 19.1% (previous year: 16.8%) in the period from January through September. In the third quarter, it was reduced as a result of increases in material costs, which could not be immediately recovered. Adjusted EBIT rose to EUR 26.0 million in the nine-month period (previous year: EUR 1.2 million). At EUR 1.8 million, the accumulated adjusted result for the period continued the year over year improvement (previous year: EUR -12.0 million). Adjusted earnings per share improved to EUR 0.09 (previous year: EUR -0.58).
SAF-Holland is continuing to focus on optimizing inventory management at its plants for the purpose of improving its cash flow and liquidity development on an ongoing basis. Cash flow from operating activities before income tax payments increased to EUR 34.2 million (previous year: EUR 29.1 million) in the reporting period. As a result of increasing demand, the number of employees increased as of the reporting date of Sept. 30, 2010 to 2,742 including temporary employees (Dec. 31, 2009: 2,331).
Trailer Systems increases operating result
The Trailer Systems business unit almost reached the break-even level in the third quarter with an adjusted EBIT of EUR -0.1 million. Demand continued to increase in both North America and Europe. Overall, the business unit increased its sales in the first nine months by 74.6% to EUR 227.9 million (previous year: EUR 130.5 million), adjusted for exchange rate effects to EUR 225.3 million. Thanks to the increase in sales in conjunction with a reduction in costs, the gross margin improved to 5.7% (previous year: -3.6%). The business unit contributed 49.6% (previous year: 41.2%) to total sales.
Powered Vehicle Systems shows upward trend
Sales in the Powered Vehicle Systems business unit were reduced in the third quarter by the usual July plant closures by major customers in North America. Despite this seasonal effect, demand in the truck sector continues to grow. In the first nine months, the business unit’s sales increased by 28.2% to EUR 93.6 million (previous year: EUR 73.0 million), adjusted for exchange rate effects to EUR 90.6 million. The gross margin was at 24.3% (previous year: 22.1%). Its share of total sales amounted to 20.4% (previous year: 23.1%).
