DGAP-News: STS Group AG publishes figures for the first half-year 2019 / Decline in revenues and earnings in H1 2019 compared with previous year, however, Q2 2019 above the previous quarter

STS Group AG publishes figures for the first half-year 2019 / Decline in revenues and earnings in H1 2019 compared with previous year, however, Q2 2019 above the previous quarter
 

- Revenues at 193.8 mEUR in H1/2019. Downturn of 11.2% compared to prior year (H1/2018: 218.2 mEUR) in particular due to the generally challenging market environment

- Revenues at 98.3 mEUR in Q2/2019, 2.9% higher than in Q1 2019 (95.5 mEUR)

- EBITDA of 10.1 mEUR in H1/2019, grows by +46.4% compared to prior year (H1/2018: 6.9 mEUR)

- EBITDA increases by +34.9% to 5.8 mEUR in Q2/2019 compared to Q1/2019 (4.3 mEUR)

- Adjusted EBITDA of 10.1 mEUR decreases by 38.8% in H1/2019 compared to prior year (H1/2018: 16.5 mEUR) due to lower revenue base. No special effects were adjusted in the first half-year 2019

- Positive order development in the first half-year 2019

- Forecast adjusted on August 2, 2019: decline in revenues of between 4.5 and 9.5 % compared to previous year, adjusted EBITDA margin between 4.6 and 5.3%

Hallbergmoos/Munich, August 7, 2019. STS Group AG (ISIN: DE000A1TNU68; www.sts.group), the global system supplier for the automotive industry and listed in the Prime Standard of the Frankfurt Stock Exchange, today publishes its report on the first half-year 2019.

Andreas Becker, CEO of STS Group AG: "The European and Chinese vehicle markets remain challenging and show lower call-off figures in the reporting period compared to the prior year, impacting our revenue and earnings development in the first half of the year. Nevertheless, in this environment we were able to increase our revenue and EBITDA in the second quarter of 2019 compared with the previous quarter. We also gained major orders in China for e-mobility and long-nose trucks. Against this backdrop, we are optimistic about the future".

Revenue and earnings development
STS Group generated revenues of 193.8 mEUR in the first half-year of 2019 (H1/2018: 218.2 mEUR), which represents a revenue decline of 11.2% compared to the same period of the previous year. The reasons for this development are a major order in the Plastics segment that expired at the end of the first half of 2018, decreases in the relevant passenger car market and a continuously challenging market environment in China. Nevertheless, revenues in the second quarter of 2019 were up 2.9% on the first quarter of 2019. EBITDA rose in the reporting period by 3.2 mEUR to 10.1 mEUR compared to the first half of 2018 (H1/2018: 6.9 mEUR). Adjusted EBITDA decreased by 6.4 mEUR to 10.1 mEUR in the reporting period (H1/2018: 16.5 mEUR). The measures which were already implemented to increase production efficiency only partially compensated for the effects of the lower business volume. Despite declining revenues, consolidated net income improved to -2.3 mEUR (H1/2018: -2.8 mEUR).

In the Acoustics segment, weaker customer call-offs in the relevant passenger car market in Italy and Brazil led to a revenue decline of 12.3% to 60.1 mEUR in the first half of 2019 (H1/2018: 68.6 mEUR). At 31.1 mEUR, revenues in Q2/2019 were up on the first quarter (Q1/2019: 29.0 mEUR). EBITDA rose to 0.7 mEUR in the first half of 2019 (H1/2018: 0.1 mEUR). The plant in Poland still recorded a negative EBITDA, even though the implemented measures are showing initial improvements in earnings.

The revenue decline by 12.2% to 94.1 mEUR in the Plastics segment resulted mainly from the planned expiry of a major order (approx. -4.0 mEUR) in the second half year 2018, which was already announced, as well as from lower customer call-offs. Compared to the previous quarter (Q1/2019: 46.5 mEUR), revenues in the second quarter of 2019 increased to 47.6 mEUR. EBITDA rose to 7.6 mEUR in the first half-year 2019 (H1/2018: 6.9 mEUR), especially due to the efficiency gains achieved and the absence of negative special effects incurred in the previous year .

In an overall significantly declining Chinese automotive market, the China segment recorded revenues of 23.0 mEUR in the first half of 2019, down 11.5% from 26.0 mEUR in H1/2018. At 11.6 mEUR, revenue volume in the second quarter was slightly higher than in the first quarter of 2019 (Q1/2019: 11.3 mEUR). EBITDA of the segment amounted to 3.0 mEUR in the first half of 2019 (H1/2018: 3.8 mEUR), which is attributable to the lower revenue volume and weaker capacity utilization.

Revenues of 21.3 mEUR in the Materials segment in the first half of 2019 were slightly below the figure of the previous year of 21.9 mEUR. EBITDA decreased in the same period from 1.2 mEUR to 0.9 mEUR.

Order situation in the first half of 2019
Despite the current difficult market environment, STS Group AG considers itself well positioned for future market developments. Important new projects for the Chinese and European businesses were acquired in the first half of 2019. In addition, strategically important projects in the field of electromobility were won. Some of these projects will already have an impact on revenues next year.

Forecast 2019
Taking into account the continuing challenging market environment in Europe and China, the Management Board adjusted its forecast for the full year on August 2. As a consequence, management expects a revenue decline of between 4.5% and 9.5% for the current fiscal year (original guidance: revenue at previous year's level of around 400 mEUR) and an adjusted EBITDA margin of between 4.6% and 5.3% (original guidance: adjusted EBITDA at previous year's level of around 23.7 mEUR, corresponding to an EBITDA margin of around 5.9%).

The full report on the first half-year 2019 of STS Group AG is available for download at https://ir.sts.group/websites/stsgroup/German/3100/finanzberichte.html.

Conference Call on August 7, 2019
STS Group AG will hold a conference call in English for interested investors and press representatives on August 7, 2019 at 2 p.m. today. To register, please send an email to ir@sts.group.

About STS Group:
STS Group AG, www.sts.group (ISIN: DE000A1TNU68), is a leading system supplier to the automotive industry for soft and hard trim. The Group, which has a history of tradition and expertise dating back to 1934, employs more than 2,500 people and generated revenue of 401,2 mEUR in the 2018 financial year. At its 17 plants in total in France, Italy, Germany, Poland, Mexico, Brazil and China, the STS Group ("STS") produces plastic and acoustic components, such as solid and flexible vehicle trim, noise and vibration-damping materials and entire interior and exterior trim systems. STS is considered a technology leader in the manufacture of plastic injection molding, specialty acoustic products and components from sheet molding compounds (SMC). STS has a strong footprint with plants in China, Europe, Mexico and Brazil. The customer portfolio comprises leading international commercial vehicle and automotive manufacturers.

STS Group AG
Stefan Hummel
Head of Investor Relations
Zeppelinstrasse 4
85399 Hallbergmoos
+49 811 1244 9412
ir@sts.group
www.sts.group

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