Frauenthal Group: Solid first-half results 

 Vienna, 29.08.2017

  •  Positive trading environment in both divisions 
  •  Revenue gain of 19% to EUR 428.9m 
  •  EBITDA up EUR 3.1m year on year to EUR 14.9m 
  •  Outlook for 2017: earnings expected to exceed previous year 

 “We are very satisfied with developments in the first half of 2017: trade was boosted by positive developments on the European vehicle market and strong sales volumes in the wholesale segment, while new business at Frauenthal Automotive and synergies at Frauenthal Handel bolstered earnings,” explained Frauenthal Holding AG Executive Board Member Martin Sailer. Consolidated revenue at the Frauenthal Group advanced by 19% to EUR 428.9m (H1 2016: EUR 360.6m1). The Frauenthal Trade Division accounted for around 68.5% of total revenue, and Frauenthal Automotive for about 31.5%. The increase in revenue includes EUR 30.7m generated by Frauenthal Powertrain between April and June 2017. Acquired on 1 April 2017, the new business has two plants in Germany. The Group’s EBITDA increased to EUR 14.9m in the first half of 2017, up from EUR 11.8m a year earlier. EBIT rose by EUR 1.6m year on year, to EUR 5.8m.

 

Frauenthal Trade: investments in integration bearing fruit 

Frauenthal Trade reported a EUR 19.8m increase in revenue to EUR 294.0m. The Group’s plumbing supplies segment (ÖAG/SHT) benefited from growth in the project business, while Kontinentale also reported healthy gains thanks to a positive environment for infrastructure investment. Despite the strong pressure on prices in the project segment, the contribution margin was up significantly on the previous year thanks to the increase in volumes. EBITDA went up by EUR 2.6m to EUR 5.8m. “We reported a significant improvement in earnings. In addition to increased revenue, this is primarily attributable to the synergies we leveraged and the absence of integration costs,” commented Wolfgang Knezek, Frauenthal Holding Executive Board member responsible for Frauenthal Trade.

 

Frauenthal Automotive: acquisition of new powertrain business 

Both the European truck market and key passenger vehicle manufacturers reported growth in the first half of 2017. The Frauenthal Automotive Division recorded encouraging gains in both revenue and earnings. Revenue increased by EUR 48.5m (including EUR 30.7m attributable to Frauenthal Powertrain) to EUR 134.9m. In addition to the positive trading environment and the acquisition of Frauenthal Powertrain (development and production of forged parts and camshafts for combustion engines), this rise also reflected organic growth in business with existing customers as well as new customers in all segments. EBITDA amounted to EUR 10.0m, up by EUR 0.7m on the same period a year earlier.

 

Outlook for 2017 

The Frauenthal Group’s earnings are expected to increase year on year, due to positive market conditions for both divisions and, above all, the absence of non-recurring items, which had a particularly strong impact on both divisions’ earnings last year.

The plumbing supplies market is expanding in volume terms, but margins are under considerable pressure owing to the higher proportion of large-scale projects, where price-based competition is strong. Thanks to further optimisation of cost structures, Frauenthal Trade is expected to report an improvement in full-year earnings for 2017.

Frauenthal Automotive is likewise set to improve on the previous year’s earnings in 2017. In the short and medium term, the division’s activities will focus on integrating Frauenthal Powertrain.

The Frauenthal Group’s consolidated earnings are expected to rise year on year in 2017.

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1Comparative figures for January to June 2016 adjusted for the disposals of Frauenthal Automotive Azambuja including its two Austrian sales subsidiaries (Frauenthal Automotive) and SHT Slovensko s.r.o. (Frauenthal Trade). The automotive businesses (combined revenue of EUR 18.8m for January-April 2016) were deconsolidated as of 30 April 2016. The deconsolidation effect resulted in extraordinary expenses of EUR 3.9m. In the Frauenthal Trade Division, SHT Slovensko s.r.o. was sold on 16 March 2016, completing the withdrawal from a business that was no longer possible to run at a profit. This company reported revenue of EUR 2.3m in 2016 and extraordinary expenses of EUR 0.3m arising from deconsolidation were recognised.

 

About the Frauenthal Group 

The Vienna-listed Frauenthal Group is a diversified group consisting of two business divisions: Frauenthal Automotive and Frauenthal Trade. Frauenthal Automotive is the market and technology leader in the European commercial and passenger vehicle industry, as well as a leading development partner. It produces stamped and welded metal parts (Gnotec), airtanks and U-bolts, as well as connecting rods and camshafts (Frauenthal Powertrain), and has nine plants in five European countries and one in China. Frauenthal Trade, a leader in its home market, comprises Austrian plumbing supplies wholesalers SHT and ÖAG, civil engineering and industrial specialist Kontinentale, and service company Frauenthal Service. The Frauenthal Group employed an average of around 3,270 people in the first half of 2017.

 

 

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