JOST Werke AG / Key word(s): Change in Forecast/Half Year Results
JOST raises sales forecast for fiscal year 2018;
- Sales in H1 2018 grew to EUR 381.1 million; organic growth +9.1%
- Adjusted EBIT H1 2018 rises to EUR 45.0 million (H1 2017: EUR 44.3 million)
- Sales forecast raised for 2018: mid to high single-digit organic sales growth (previously: mid-single-digit organic growth)
- Positive net impact of EUR 11 to 13 million on net income in 2018 from capitalization of deferred tax arising from loss carryforwards
Neu-Isenburg, July 25, 2018. JOST Werke AG ("JOST"), a leading global producer and supplier of safety-critical systems for trucks and trailers, announces preliminary interim results for the first half of 2018 and raises its sales forecast for the 2018 financial year.
According to preliminary figures, JOST increased organic Group sales by 9.1% in the first half of 2018. Despite headwind from currency effects, reported Group sales grew by 5.3% to EUR 381.1 million (H1 2017: EUR 361.9 million), continuing the positive trend of the first quarter of 2018. The strongest growth was recorded in North America with organic sales increasing by 20.6% over the previous year. JOST benefited from the sharp increase in truck production in North America as well as from further market share gains in the region. Reported sales in North America rose to EUR 66.3 million (H1 2017: EUR 61.6 million). In Europe, JOST sales grew by 6.2% to EUR 242.8 million (H1 2017: EUR 228.6 million) in the first half of 2018. In the same period, organic sales in Asia, Pacific and Africa (APA) rose by 6.6% compared to the already strong first half of 2017, with reported sales reaching EUR 72.0 million (H1 2017: EUR 71.7 million).
High profitability even in a difficult environment
Despite the steep rise in raw material prices, particularly in the United States, and additional cost pressure due to capacity constraints in the supply chain, JOST was able to increase adjusted earnings before interest and taxes (EBIT) to EUR 45.0 million (H1 2017: EUR 44.3 million) in the first half of 2018. Adjusted EBIT margin amounted to 11.8% (H1 2017: 12.2%).
In Europe, the Group was able to keep the adjusted EBIT margin stable at 11.3% in the first half of 2018 (H1 2017: 11.3%). Adjusted EBIT in the region increased to EUR 27.4 million (H1 2017: EUR 25.8 million).
In North America, adjusted EBIT decreased to EUR 5.6 million (H1 2017: EUR 6.6 million) and EBIT margin amounted to 8.4% (H1 2017: 10.8%). In addition to the steep rise in steel prices, this development was caused by higher costs for hiring and training new employees in the wake of increased production volumes as well as by changes in customer mix in favor of OEMs. The dynamic growth with OEMs and the further market share gains strengthen JOST's position in the rapidly growing North American market and at the same time offer the company future potential in the aftermarket.
In the course of the second quarter, JOST was able to further improve efficiency in the production lines relocated to Wuhan. In the first half of 2018, JOST almost reached previous year's profitability level despite the increase in material prices and the relocation-related ramp-up costs. Adjusted EBIT in APA totaled EUR 10.6 million (H1 2017: EUR 10.8 million) in the first half of 2018 and the adjusted EBIT margin amounted to 14.7% (H1 2017: 15.1%).
In connection with and in addition to the financial benefits of the new refinancing announced at the end of June 2018, JOST can, according to preliminary calculations, use past tax loss carryforwards faster than originally anticipated. As a result, additional deferred taxes in an estimated amount of EUR 13 to 15 million will be capitalized. This will have a positive impact on the Group's income taxes in the first half of 2018. The effect will be partially offset by non-recurring financing expenses and advisory fees totaling less than EUR 3 million. Hence, earnings after taxes for fiscal year 2018 are expected to be EUR 11 to 13 million higher than previously expected. The tax effect will not affect cash in fiscal year 2018. However, it will have a positive impact on the Group's liquidity over the next years.
Based on the sales generated during the first half of 2018 and taking into account the anticipated business development for the Group, JOST now expects a mid to high single-digit organic sales growth in 2018, compared to the previous year (previous forecast: mid-single-digit organic sales growth). JOST continues to forecast a mid-single-digit increase in adjusted EBIT compared with 2017.
|Company:||JOST Werke AG|
|Phone:||+49 6102 2950|
|Fax:||+49 (0)6102 295-298|
|Listed:||Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Munich, Stuttgart, Tradegate Exchange|
|End of Announcement||DGAP News Service|
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