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ElringKlinger Q4 Profit, Order Down; FY12 Adj. EBIT Below View; Shares Hit

3/8/2013 6:07 AM ET

Shares of ElringKlinger Group (EGKLF.PK) declined around 9 percent in the morning trade on Frankfurt's Xetra after the German manufacturer of cylinder-head and specialty gaskets reported a decline in fourth-quarter profit, despite higher sales. The company added that its adjusted EBIT for fiscal 2012 was below expectations despite growth. Looking ahead for fiscal 2013, ElringKlinger targets growth in earnings and revenue.

In its recently concluded fourth quarter, profit attributable to shareholders declined 7.7 percent to 13.2 million euros from last year's 14.3 million euros. Earnings per share dropped 8.7 percent to 0.21 euros from 0.23 euros a year ago.

According to the company, the significantly weaker sales and thus earnings contributions made by the Aftermarket and Engineered Plastics segments narrowed its quarterly earnings.

Sales revenue, however, grew 3 percent to 277.6 million euros from last year's 269.6 million euros, even as both the Aftermarket and the Engineered Plastics segment had to contend with particularly weak sales. Alongside market expansion and the rollout of new products, revenue growth was also driven by acquisitions.

At 260.8 million euros, order intake in the fourth quarter was down 4.3 percent from last year.

In the year 2012, attributable profit was 85.9 million euros or 1.36 euros per share, compared to 94.9 million euros in the prior year. Adjusted for prior year's one-time gain of 16.5 million euros, net income increased 9.6 percent.

Sales revenue increased 9.1 percent to 1.13 billion euros from 1.03 billion euros last year.

ElringKlinger said it again grew significantly faster than the global vehicle markets in 2012.

In 2012, order intake within the firm rose 4.2 percent in total to 1.13 billion euros. As of December 31, order backlog stood at 456 million euros, 1.7 percent higher than last year.

Looking ahead, ElringKlinger targets organic revenue growth of 5 percent to 7 percent in 2013. The company expects that earnings before interest and taxes, adjusted for one-time effects, will expand at a more pronounced rate than sales revenue. The Group expects adjusted EBIT to range from 150 million euros to 155 million euros in 2013, higher than 136.0 million euros in 2012.

The operating margin attributable to ElringKlinger's core business will be adversely affected, the company said.

The full announcement of the results for fiscal 2012 is scheduled for March 28.

On Frankfurt's Xetra, ElringKlinger shares are currently trading at 25.52 euros, down 2.57 euros or 9.17 percent.

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by RTT Staff Writer

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