HÖRMANN Industries publishes 2018 annual financial statements and considers early refinancing of 2016/2021 corporate bond

HÖRMANN Industries GmbH (corporate bond, German Securities Code Number (WKN): A2AAZG) today published its 2018 annual financial statements. In the 2018 financial year, sales increased from EUR 521.9 million (2017) to EUR 624.1 million, while EBITDA rose by around 53% year-on-year to EUR 41.8 million. Operating EBIT improved by 45% to EUR 30.5 million (previous year: EUR 21.1 million). This meant the sales and earnings forecasts that were upwardly revised in September 2018 were exceeded. HÖRMANN Industries closed the 2018 financial year with consolidated net income of EUR 14.6 million, up 60.4% on the previous year (EUR 9.1 million), with all four segments making a positive earnings contribution. The Group’s equity base improved from EUR 99.6 million at the end of the previous year to EUR 112.8 million at 31 December 2018 thanks to the positive results of operations. The equity ratio increased from 35.1% (31 December 2017) to 38.3% at the reporting date, while net cash and cash equivalents amounted to EUR 77.3 million. Total assets rose by EUR 11.3 million to EUR 294.7 million as a result of the higher level of current assets. Excluding trainees, the company had an average of 3,175 employees in the reporting period, up 12.4% compared with 2017.

The Automotive division generated sales of EUR 423.9 million in the 2018 financial year (previous year: EUR 375.4 million), thus significantly exceeding the forecast of EUR 375 million. In addition to the positive order situation, this was due to higher commodity prices that were passed on to customers. Adjusted EBIT (before non-recurring and prior-period effects of EUR 6.3 million) amounted to EUR 10.1 million (previous year: EUR 7.1 million). This increase was mainly attributable to the positive performance of the plants in Gustavsburg, Bánovce (Slovakia) and Saarbrücken. By contrast, substantial additional costs at the Penzberg plant due to the high degree of capacity utilisation and increased staff costs led to negative EBIT of EUR -2.0 million. In this context, HÖRMANN Automotive Penzberg GmbH (HAP) was spun off from the HÖRMANN Industries Group in April 2019 and transferred to the unconsolidated HÖRMANN equity investment FTH Fahrzeugteileholding GmbH, Chemnitz, with economic effect from 1 January 2019 to facilitate the orderly closure of the plant. Production at the plant is being gradually transferred to other HÖRMANN Automotive plants, especially the Bánovce plant in Slovakia.

As expected, sales in the Engineering division increased sharply from EUR 33.3 million to EUR 66.0 million in the reporting period due to the multi-year project orders that are currently being processed. The good order and project situation resulted in EBIT of EUR 8.6 million, up EUR 3.5 million or 68.6% on the previous year. All of the subsidiaries in the Engineering division made positive earnings contributions to this encouraging development. The strongest company in the Engineering division in terms of sales, HÖRMANN Logistik GmbH, acquired a majority interest in Klatt Fördertechnik GmbH, Neumarkt am Wallersee (Austria), in April 2019. For HÖRMANN Logistik GmbH, the acquisition represents a vertical expansion of its existing product range and the strengthening of its value chain, as well as an expansion of its customer base and the sectors it serves.

Funkwerk AG, which forms part of the Communication division together with its subsidiaries, also developed extremely positively in the 2018 financial year. With consolidated sales of EUR 82.7 million (previous year: EUR 77.5 million), a figure that lies within the increased forecast range of EUR 80–85 million issued in August 2018, the company benefited in particular from the sharp rise in capacity utilisation. EBIT saw dynamic growth of EUR 4.3 million, or 59.2%, to EUR 11.4 million, thereby exceeding the forecast range of between EUR 8.5 million and EUR 9.0 million. In addition to the business expansion and the high level of capacity utilisation, the margin primarily increased as a result of the continuous improvement in cost structures and quality and process flows. The Communication division has enjoyed largely stable sales development over a number of years. In 2018, it generated sales of EUR 96.3 million (previous year: EUR 92.0 million) and EBIT of EUR 12.1 million (previous year: EUR 7.6 million).

In the 2018 financial year, the Services division increased its sales significantly by 84.0% to EUR 39.0 million. Among other things, this was due to the acquisitions made in late 2017. Having been slightly positive at EUR 0.5 million in 2017, EBIT also improved to EUR 1.2 million in the reporting year. The 2018 financial year saw the conclusion or extension of strategically important contracts with several high-profile existing customers as well as the conclusion of master agreements with important new customers. Measures to streamline and optimise the subsidiaries in the relatively young division also continued. This included establishing management teams, integrating differing corporate cultures and harmonising administrative processes. The division’s progress is also reflected in its workforce growth. 43 new employees were appointed in the past financial year, including eight new colleagues who were selected as part of the “Employees recruit employees” programme.

HÖRMANN Industries expects consolidated sales to total around EUR 580 million in the 2019 financial year. This decline is mainly attributable to the spin-off of HÖRMANN Automotive Penzberg GmbH. Operating EBIT is expected to amount to around EUR 25 million and will again be impacted by restructuring and deconsolidation expenses in connection with the realignment of the automotive plants. The company reserves the right to make use of targeted acquisitions in order to seize any opportunities for inorganic growth that may present themselves and thus advance the diversification of the Group and reinforce the positive performance of the individual divisions.

The complete annual financial statements can be downloaded at https://www.hoermann-gruppe.de/financial-reports/.

Early refinancing of 2016/2021 corporate bond considered
In light of its positive business development, HÖRMANN Industries GmbH is also considering the early refinancing of its corporate bond that is scheduled to mature in 2021 (German Securities Code Number (WKN): A2AAZG / ISIN: DE000A2AAZG8). This course of action is being examined with a view to the call option for the existing bond that is available from 21 November 2019 at a price of 101.5%. With this in mind, the company is also examining the issue of a new corporate bond including an exchange offer for investors of the existing bond. HÖRMANN Industries is aiming to secure and further optimise its medium- to long-term financing structure at an early stage in what is a favourable interest rate environment. The decision on the early redemption of the existing bond and the issue of a new bond will be taken on the basis of the market environment and the outcome of discussions with investors and financing partners.

Selected key figures of HÖRMANN Industries GmbH can be found in the PDF file.