Hella sales and earnings declined as expected in the first nine months of the fiscal year 2019/2020 (June 2019 to February 2020) in a considerably negative market environment. Currency and portfolio-adjusted sales decreased by 3.7% to € 4.8bn; reported Group sales decreased by 6.2% due to portfolio changes.
“In the third quarter, we have already been affected by the first impacts of the Covid-19 pandemic,” said Hella CEO Dr. Rolf Breidenbach. “From a nine-month perspective, however, we are still in line with our overall expectations. Above all, we have once again performed significantly better than the automotive market, which further confirms the strength and resilience of our business model.”
• Reported sales of the aftermarket segment declined by 1.7% to €464m in the nine-month period. Although the independent aftermarket business recovered in individual target markets in the third quarter and thus led to a sales increase, demand for spare parts was significantly lower overall, particularly in southwestern Europe and the Middle East.
• Business in special applications declined due to market weakness of individual customer groups. Business was impacted in the nine-month period, particularly due to the continuing weakness of the market for agricultural and construction machinery as well as trailers. Consequently, reported segment sales declined by 8.7% to €272m.
In view of the continuing spread of the pandemic and the related impact on the global automotive industry, Hella had already announced last month that their company targets for the current fiscal year 2019/2020 won’t be achieved. Due to declining customer demand and possible disruptions in logistics chains, they now expect currency and portfolio-adjusted sales to be below the originally forecasted range of €6.5bn to €7bn. As there is currently only limited visibility regarding the consequences of the pandemic, it is not possible to estimate the amount more accurately at this time. Depending on the development and duration of the loss of business, also the EBIT margin adjusted for restructuring measures and portfolio effects is estimated to fall considerably below the originally forecasted target of 7%.