DGAP-News: HELLA KGaA Hueck & Co.: HELLA grows substantially and increases profitability

HELLA grows substantially and increases profitability

- Group sales rise to about EUR 5.8 million (+9%)

- Automotive segment with Lighting and Electronics as main growth driver

- Adjusted EBIT improves to about EUR 445 million (+12%), adjusted EBIT margin increases to 7.6%

- Outlook: plans for additional international growth

Lippstadt/Duesseldorf, 14 August 2015. HELLA KGaA Hueck & Co., one of the world's leading automotive suppliers, successfully continued its globalisation strategy in fiscal year 2014/2015 ending on 31 May 2015. HELLA generated group sales of EUR 5.8 billion (previous year: EUR 5.3 billion). This corresponds to a 9.2% increase - 2.3% of which is based on currency effects. Adjusted operating earnings (EBIT) grew to EUR 445 million (previous year: EUR 399 million). Accordingly, HELLA improved its adjusted EBIT margin by 0.1% to 7.6%.

"The past fiscal year was very successful for HELLA", says Dr Rolf Breidenbach, CEO of HELLA. "We achieved our targets: HELLA continued its growth significantly above market level and we also increased profitability."

Growth driver Automotive

The Automotive business again benefited from strong automotive demand in financial year 2014/2015. External sales grew by 11% to EUR 4.4 billion (previous year: EUR 3.9 billion) and profits in this business rose to about EUR 354 million (previous year EUR 291 million). This continued growth was driven by market demand as well as several new product launches which included particularly headlamps with complex LED technology and electronic systems for driver assistance and energy management. The Aftermarket segment, which had been weak in the first half, increased external revenues by a total 5% to EUR 1.13 million (previous year: EUR 1.08 billion) mainly on the back of wholesale activities in Denmark and Poland. Adjusted operating earnings decreased slightly to EUR 73 million (previous year: EUR 78 million). The Special Applications business was severely hit by weak agricultural demand in the past fiscal year particularly as a result of the Ukrainian crisis. External sales fell by 10% to about EUR 308 million (previous year: EUR 343 million), EBIT declined to EUR 19 million (previous year: EUR 28 million).

Focus on technology leadership

Research and development expenditures were again high in financial year 2014/2015 reaching EUR 544 million or 9.3% of sales (previous year: 9.6%). The number of employees working globally in research and development increased by 3 percent to over 6,000 over the reporting period. With its focus on research and development as a crucial element of its corporate strategy, HELLA is further strengthening its technology leadership.

"Technologically leading products are key to the HELLA strategy", says Dr Breidenbach. "They create a competitive edge and at the same time build the foundation for our future growth."

In the past financial year, development in the Lighting business division centred mainly on concepts that enable a comprehensive use of LED technologies across all vehicle segments. In Electronics, the main development focus was on technologies that help reduce CO₂ emissions and a new generation of radar sensors for a 360 degree capture of the surroundings.

Adjusted EBIT margin increases

In the financial year, HELLA Group generated EBIT of EUR 430 million and a corresponding EBIT margin of 7.4% which was up 0.9 percentage points year on year. Adjusted by restructuring costs from the voluntary severance and phased retirement program which was initiated in the previous year, the adjusted EBIT increased to EUR 445 million and the operating margin by 0.1 percentage points to 7.6%.

Solid financial foundation

The reinvested profits and the 11% capital increase in connection with the IPO give HELLA a very solid financing structure. As at 31 May 2015, the equity ratio had grown substantially year on year to 39% (previous year: 30%). Adjusted for the high liquidity position of EUR 1 billion, the equity ratio is 49% (previous year: 39%).

"Sustainable growth requires long-term financing base", says Dr Wolfgang Ollig, CFO. "Solid financing to provide an adequate scope for action therefore forms an integral part of our strategy."

International network strategy successfully completed

Joint ventures with partners have been a key component of HELLA's growth strategy for over 15 years and give the Company access to new markets. Overall, external sales of companies accounted at equity amounted to EUR 2.9 billion, the pro rata at-equity result reached EUR 55 million. The external sales are not included in Group sales.

On 13 August 2015, the Company concluded a purchase contract for the outstanding 50% of the shares in the wholesale activities (Inter-Team) in Poland. The acquisition is subject to approval by the antitrust authorities. This move strengthens the Aftermarket business and HELLA's strategic growth potential in Eastern European wholesaling.

Outlook for financial year 2015/2016

HELLA expects the positive business development to continue in the current financial year. Beyond strengthening its market position through technological leadership in key product areas and exploiting growth opportunities from global expansion, HELLA also expects to contribute to this development by improving its operating excellence.

For financial year 2015/2016, HELLA Group plans to grow sales and EBIT in the middle to high single-digit percentage range.

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HELLA KGaA Hueck & Co., Lippstadt: HELLA is a global, family-owned company, listed on the stock exchange, with approx. 32,000 employees at 100 locations in more than 35 countries. The HELLA Group develops and manufactures lighting technology and electronic components and systems for the automotive industry and also has one of the largest retail organizations for automotive parts, accessories, diagnostics, and services within Europe. Complete vehicle modules, air-conditioning systems, and vehicle electrical systems are also produced in joint venture companies. With more than 6,000 people working in research and development, HELLA is one of the most important innovation drivers on the market. In addition, with sales of EUR 5.8 billion in fiscal year 2014/2015, the HELLA Group is one of the top 40 automotive suppliers in the world and one of the 100 largest German industrial companies.

For additional information please contact:
Dr Markus Richter
Company spokesperson
HELLA KGaA Hueck & Co.
Rixbecker Straße 75
59552 Lippstadt
Deutschland
Tel.: +49 (0)2941 38-7545
Fax: +49 (0)2941 38-477545
Markus.Richter@hella.com
www.hella.com