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STS Group AG confirms preliminary figures for 2019 financial year; Outlook 2020: Decline in revenues and adjusted EBITDA

EQS Group Thursday, 9 April 2020
DGAP-News: STS Group AG / Key word(s): Annual Results
09.04.2020 / 07:00
The issuer is solely responsible for the content of this announcement.*STS Group AG confirms preliminary figures for 2019 financial year; Outlook 2020: Decline in revenues and adjusted EBITDA*

- Audited consolidated figures confirm preliminary figures of March 10, 2020

- Revenues down 9.6% to 362.8 mEUR (2018: 401.2 mEUR)

- EBITDA increased by 22.7% to 14.6 mEUR (2018: 11.9 mEUR)

- Adjusted EBITDA at 17.6 mEUR (2018: 23.7 mEUR)

- Net financial debt (incl. leases) reduced to 39.1 mEUR as of December 31, 2019 (September 30, 2019: 56.2 mEUR)

- Outlook 2020: Decline in revenues and adjusted EBITDA; business development in 2020 uncertain due to COVID-19

*Hallbergmoos/Munich*, April 9, 2020. STS Group AG (ISIN: DE000A1TNU68), the global system supplier for the automotive and commercial vehicle industry, listed in the Prime Standard of the Frankfurt Stock Exchange, today published its annual report, audited consolidated figures for the 2019 financial year and confirmed the preliminary figures from March 10, 2020.

Andreas Becker, CEO of STS Group AG: "Despite a challenging business year with declining customer call-off orders in key automotive markets, we were able to successfully implement several strategic projects for future growth. The effects of the COVID-19 pandemic continue to challenge us. It is currently difficult to reliably quantify the economic impact. We have responded immediately to the effects of the pandemic with a variety of measures. It is particularly important to us to keep the economic damage as low as possible and to provide our employees with the best possible protection. The Group will continue to respond flexibly to the changing situation in the markets."

*2019 financial year - Revised annual forecast accomplished*
In the 2019 financial year, the Group generated revenues of 362.8 mEUR (2018: 401.2 mEUR). The 9.6% drop in revenues is primarily attributable to a downturn in the European market. Revenues in the Acoustics, Plastics and Materials segments fell by a total of 11.6%. Only the China segment achieved a slight growth of 3.7%.

Despite the decline in revenues, consolidated earnings before interest, taxes, depreciation and amortisation (EBITDA) for the year under review amounted to 14.6 mEUR, up 22.7% on the previous year (2018: 11.9 mEUR). Special expenses of 3.0 mEUR were incurred in the 2019 financial year (2018: 11.8 mEUR), mainly for severance costs, reorganization measures and consultancy costs. EBITDA adjusted for special effects (adjusted EBITDA) decreased from 23.7 EUR to 17.6 mEUR due to the lower business volume. The adjusted EBITDA margin was 4.9% (2018: 5.9%). The efficiency gains achieved in production could only partially offset the volume-related negative earnings effects. STS Group AG has thus met its full-year revenue and adjusted EBITDA guidance as revised in August 2019.

After amortization, depreciation, interest and taxes, consolidated annual result for the 2019 financial year amounts to minus 12.1 mEUR (2018: minus 4.8 mEUR). Equity as of December 31, 2019, amounted to 68.6 mEUR after 82.4 mEUR as of the 2018 balance sheet date, corresponding to an equity ratio of 26.8% (December 31, 2018: 30.1%). Cash and cash equivalents amounted to 17.2 mEUR as of December 31, 2019 (December 31, 2018: 31.2 mEUR). Driven by tight working capital management, operating cash flow in 2019 increased significantly to 36.6 mEUR after 7.1 mEUR in the previous year.

Consolidated net financial debt increased by 8.0 mEUR to 39.1 mEUR as of December 31, 2019 (December 31, 2018: 31.1 mEUR). The increase is mainly attributable to higher lease liabilities (December 31, 2019: 24.1 mEUR; December 31, 2018: 3.2 mEUR) following the introduction of IFRS 16 in the 2019 financial year. Compared to EUR 56.2 million as of September 30, 2019, net financial debt was reduced significantly to December 31, 2019, mainly driven by the sale of receivables by way of genuine factoring and other working capital management measures.

*2020 financial year - Detailed outlook currently not possible as a result of the COVID-19 pandemic*
Based on the latest developments in relation to the COVID-19 pandemic in Europe, North and South America, the Executive Board sees the market environment for STS Group in the financial year 2020 as extremely challenging. Since mid-March 2020, STS plants in the aforementioned regions have been shut down or production has been significantly reduced. The Executive Board does not currently expect the plants to be able to resume regular production before April 20, 2020. The effects of COVID-19 on the above markets cannot be reliably estimated at present. In contrast, STS plants in China have resumed production and are currently well utilized.

Against this background, the Executive Board assumes that revenues in the 2020 financial year will be below the previous year. Extensive cost-cutting measures have already been initiated. Nevertheless, a reduced adjusted EBITDA margin is expected for STS Group.

As a result of the high degree of uncertainty in connection with developments around the COVID-19 pandemic, the Executive Board is currently only able to provide a comparative forecast.

It is currently not foreseeable how COVID-19 will affect further overall economic developments as well as the commercial vehicle and automotive sectors. As soon as it is possible to make sufficiently reliable statements, the Executive Board will specify its forecast and inform the capital market accordingly in accordance with legal requirements.

The 2019 Annual Report of STS Group AG is available for download at https://www.sts.group/de/investor-relations/publikationen.

*Conference Call on April 9, 2020*
STS Group AG will hold a conference call for interested investors and press representatives in English today, April 9, 2020, at 10:30 a.m. For registration, please send an email to [email protected]

*Key figures for 2019 financial year*

*in mEUR*   *2019*   *2018*
Revenues   362.8   401.2
EBITDA   14.6   11.9
Adj. EBITDA   17.6   23.7
Adj. EBITDA-margin (in % of revenues)   4.9%   5.9%
EBIT   -6.5   -1.3
Earnings before taxes   -9.9   -3.3
Consolidated net result   -12.1   -4.8
Consolidated equity   68.6   82.4
Consolidated equity ratio   26.8%   30.1%
Cash available   17.2   31.2
Net financial debt   39.1   31.1
Employees   2,455   2,564


*About STS Group:*
STS Group AG, www.sts.group (ISIN: DE000A1TNU68), is a leading system supplier to the automotive industry with a focus on solutions in the acoustics, thermal and structural engineering sectors. It employs more than 2,500 people worldwide and generated revenues of 362.8 mEUR in the financial year 2019. The STS Group ("STS") produces and develops plastic and acoustic components such as solid and flexible vehicle and aerodynamic trim, noise and vibration-damping materials, entire interior and exterior trim systems, as well as lightweight construction and battery components for electric vehicles at its 17 plants and four development centres in France, Italy, Germany, Poland, Mexico, Brazil, China and, in the future, also in the USA. STS is considered as a technology leader in the manufacture of special acoustic products, plastic injection moulding and components made of composite materials (Sheet Molding Compound - SMC). STS has a large global footprint with plants in four continents. The customer portfolio comprises leading international manufacturer of commercial vehicles, passenger cars and electric vehicles.

*STS Group AG*
Stefan Hummel
Head of Investor Relations
Zeppelinstrasse 4
85399 Hallbergmoos
+49 811 1244 9412
[email protected]
www.sts.group

*Contact for financial and business press*
CROSS ALLIANCE communication GmbH
Susan Hoffmeister
+49 89 125 09 03-33
[email protected]
www.crossalliance.de
--------------------

09.04.2020 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases.
Archive at www.dgap.de --------------------

Language: English
Company: STS Group AG
Zeppelinstraße 4
85399 Hallbergmoos
Germany
Phone: +49 (0)811 124494 0
E-mail: [email protected]
Internet: https://sts.group
ISIN: DE000A1TNU68
WKN: A1TNU6
Listed: Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Munich, Stuttgart, Tradegate Exchange
EQS News ID: 1019013
End of News DGAP News Service
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