Continental AG sales increase 11.1% in third quarter
Continental AG reports consolidated sales for the first nine months of 2005 rose by 11.1% to 10,240.9 million euro, thanks in large part to the successful integration of Phoenix AG, the company noted.
Before consolidation changes and exchange rate effects, consolidated sales increased by 4.2%. Phoenix AG contributed 734.2 million euro in sales.
The consolidated operating result (EBIT) was up 35.9% to 1,138.2 million euro with a return on sales of 11.1%, or 11.9% without the consolidation of Phoenix. Consolidated earnings jumped 54.9% to 734.6 million euro.
"In the first three quarters, we have already outperformed the full-year figures for 2004 -- for net income before taxes and interest as well as profit. In addition to the excellent operational performance, this is also a result of one-off effects," said Manfred Wennemer, executive board chairman. "There is no indication that this trend will change in the fourth quarter, so we will top our record figures from last year, even when the one-off effects are not taken into consideration."
"Our key figures reflect a few special factors. Before these factors, the corporation recorded a 123.7 million euro improvement in the consolidated operating result," said Dr. Alan Hippe, a member of the executive board responsible for finances.
These special factors include:
* Consolidated EBIT for the first nine months of 2004 reflected expenses totaling 73.8 million euro for restructuring at the Mayfield plant.
* The pension plans for salaried employees in the U.S. were changed, resulting in a one-off reversal of existing obligations totaling 27.5 million euro already on the first six months of 2005.
In the first nine months of 2005, the company invested 584.1 million euro, corresponding to a capital expenditure ratio of 5.7%. Investments concentrated on production lines for the new generation of electronic brake systems and the expansion of production capacities in low-cost countries, especially in Camaçari, Brazil.
For the first nine months of 2005, expenditures for research and development rose 11.1% to 438.9 million euro, representing 4.3% of sales. In addition, the gearing ratio fell to 29.4%.
As of Sept. 30, 2005, Continental’s employees numbered 81,613, representing an increase of 1,027 compared with Dec. 31, 2004.
The figures for the divisions after three quarters follow:
* The Automotive Systems division increased its sales to 3,919.5 million euro, up 4.2% compared with the same period of 2004. Before exchange rate effects, sales rose by 4.3%. EBIT increased by 25.4% to 446.6 million euro with a return on sales of 11.4%.
* The Passenger and Light Truck Tires division increased sales in comparison to the same period of 2004 by 8.5% to 3,215.6 million euro. Before consolidation changes and exchange rate effects, sales were up 4.5%. The Passenger and Light Truck Tires division boosted its EBIT by 59.7% to 480.8 million euro, with the return on sales rising to 15%. Before special effects, earnings increased by 11.3 million euro.
* The Commercial Vehicle Tires division recorded a fall in sales of 8.6% to 1,008.8 million euro. Before changes in the scope of consolidation and exchange rate effects, however, sales rose by 7.3%. The Commercial Vehicle Tires division improved its operating result (EBIT) by 50% to 113.7 million euro, with the return on sales climbing to 11.3%. Before special effects, EBIT was up by 11.8 million euro.
* The ContiTech division boosted sales to 2,178.9 million euro, up 51% compared with the same period of 2004. Phoenix contributed 734.2 million euro in sales. Before changes in the scope of consolidation and exchange rate effects, sales were up 1.6%. ContiTech recorded a decrease in EBIT of 6.7% to 122.8 million euro, and a return on sales of 5.6%. Before special effects, EBIT increased by 61.7 million euro, representing 8.9% of sales. Phoenix contributed 11.6 million euro to EBIT -- including 29.5 million euro in expenses for social compensation plans -- and achieved a 1.6% return on sales after restructuring expenses.