EQS-News: FORVIA HELLA adjusts company outlook for fiscal year 2024

LIPPSTADT (GERMANY)

26 September 2024

FORVIA HELLA adjusts company outlook
for fiscal year 2024           

• Adjusted forecast is caused by lower-than-expected production volumes, customer-related postponements of series launches as well as customer and product mix effects
• Measures to further improve cost structures, particularly in Europe, and to grow business in the American and Asian markets are being accelerated

HELLA GmbH & Co. KGaA ("FORVIA HELLA") today announced the adjustment of the company outlook for the fiscal year 2024 (1 January to 31 December 2024). The reason for this is, on the one hand, the lower-than-expected production volumes. On the other hand, customer-related postponements in series launches, a temporary slowdown in electrification as well as customer and product mix effects particularly in China are having an increasing negative impact. For the current year, FORVIA HELLA now expects currency and portfolio-adjusted sales of between around €7.9 and 8.1 billion (previously: in the lower half of the range of around €8.1 and 8.6 billion), an operating income margin of between around 5.5 and 6.0 percent (previously: in the lower half of the range of around 6.0 to 7.0 percent) and a net cash flow in relation to reported sales of between around 2.2 and 2.7 percent (previously: at approximately 3 percent).

"We have been operating in a very challenging industry environment since the beginning of the fiscal year. However, the general conditions have deteriorated far more than expected, particularly since the middle of the year. We therefore assume that the pressure on our business development will further intensify going forward," says Bernard Schäferbarthold, CEO of FORVIA HELLA. "We are well positioned technologically and continue to address the key trends in mobility. To successfully overcome the current challenges, we will, on the one hand, consistently expand our business activities in the American and Asian markets. On the other, we will continue to improve our cost structures in general and further accelerate the competitiveness program for Europe that we launched in February this year. We expect this to have a positive effect on profitability and cash position as early as 2025."

FORVIA HELLA is pursuing a strategy of further balancing its global business and driving stronger growth particularly in the American and Asian regions. Accordingly, over the year the Company was able to achieve around two thirds of its order intake in these markets. These include series projects for rear combination lamps and car body lighting for a Chinese car manufacturer as well as large-volume customer orders from a US manufacturer for the digital vehicle access system Smart Car Access and for lighting electronics. In order to sustainably improve operating income and net cash flow, the measures already initiated to reduce costs will be further accelerated. In addition to structural adjustments in the European network, the optimization of cash through prioritization and improvements in working capital and capital expenditures is a key lever in particular. In addition, higher cost synergies from the cooperation within the FORVIA Group are expected and will also have a positive impact in this regard.

Against the background of the adjusted company outlook, an explanatory conference call for analysts and investors will be held in English today (26 September 2024), at 7:00 pm (CEST). The sales data for the first nine months of the fiscal year 2024 will be published as planned on 18 October, and the full financial results will be released as planned on 6 November. 

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