Conti depresses debt mountain after record profit

Conti depresses debt mountain after record profit

However, conti is hoping that passenger car production and also the tire business will pick up again, especially in the second half of the year. There were various best figures in 2012: for example, the bottom line is a profit of 1.9 billion euros. The debt burden fell noticeably and far more than planned.

Conti’s coffers are fuller than they were a year ago: at the end of the year, the company had 2.4 billion euros in cash and cash equivalents, a good 50 percent more than at the end of the previous year. Degenhart said acquisitions of suitable companies with annual sales of up to one billion euros are "conceivable". He did not provide further details on regions, for example.

The stock market rewarded the figures with an interim gain of around 4 percent. Conti shares were among the top performers on the dax throughout the day.

Nord/LB analyst frank schwope was pleased: "the strong figures for 2012 underpin the encouraging outlook for the current year 2013, while other industry players have to hit the brakes."

Last year’s records should also please employees and shareholders. The approximately 50,000 pay-scale employees in this country will receive a 900 euro bonus this time around. Conti plans to pay a dividend of 2.25 euros per share – that’s a 50 percent increase on the previous year and, according to CFO wolfgang schafer, the highest figure in the company’s history.

Degenhart has little hope for the home continent, which is plagued by sluggish sales – but growth overseas should counteract this, as it did in 2012. "Europe is expected to remain weak, north america is likely to grow, albeit at a much slower pace than in 2012. We see good growth in asia with china as the driving force."

For the first quarter, he said, it is already foreseeable that sales are likely to decline by "1 to 3 percent" compared with the first quarter of the previous year. Degenhart then hopes for impetus from the second half of the year. In addition to the generally more positive economic signs, the upcoming model launches of the carmakers should bring fresh momentum for conti. Sales are therefore expected to improve by 5 percent for the year as a whole. 2012 had brought in record earnings of 32.7 billion euros.

Where conti is growing, the workforce is also getting bigger, degenhart said. Overall, however, the manager dampened hopes of a noticeable increase in the number of employees. "We are cautious about the further build-up of fixed costs." at the end of 2012, the dax returnee had 169,639 employees. That was around 6,000 more than at the end of 2011.

The current business is expected to yield a similar amount in 2013 as it did last year. Adjusted for special effects, this would leave at least one in ten euros turned over as earnings before interest and taxes. In 2012, operating profit had totaled just under 3.1 billion euros.

The tire division in particular provided improvements in the current business. However, conti also benefited from a number of positive effects: in the course of the year, raw material prices for tires fell, for example, and the tax burden also eased noticeably, primarily as a result of relief in north america.

Net debt fell by a good 20 percent from just under 6.8 billion euros to around 5.3 billion euros. The group thus noticeably exceeded its target of slipping below the 6.5 billion euro mark in 2012. In 2013, the mountain of liabilities should "continue to fall," as promised by CFO schafer. Conti had accumulated debts of around 11.4 billion euros, mainly due to the purchase of siemens’ automotive technology division VDO in 2007.

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