Quarterly Report • May 28, 2009
Quarterly Report
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QUARTERLY REPORT AS OF MARCH 31, 2009
| in EUR million | Q1/2009 | Q1/2008 |
|---|---|---|
| Sales | 112.1 | 219.3 |
| Cost of sales | -93.1 | -180.8 |
| Gross profit | 19.0 | 38.5 |
| Adjusted loss/profit for the period | -5.3 | 9.4 |
| Adjusted EPS in Euro1) | -0.26 | 0.50 |
| Adjusted EBITDA | 3.1 | 21.2 |
| Adjusted EBIT | -0.5 | 18.1 |
| Operating cash flow2) | 5.5 | 2.3 |
payments.
| in EUR million | Q1/2009 | Q1/2008 |
|---|---|---|
| Europe | 57.1 | 156.6 |
| North America | 50.5 | 56.8 |
| Other | 4.5 | 5.9 |
| Total | 112.1 | 219.3 |
| in EUR million | Q1/2009 | Q1/2008 |
|---|---|---|
| Trailer Systems | 47.2 | 158.7 |
| Powered Vehicle Systems | 26.7 | 17.7 |
| Aftermarket | 38.2 | 42.9 |
| Total | 112.1 | 219.3 |
| 03/31/2009 | 12/31/2008 | |
|---|---|---|
| Total assets (in EUR million) | 536.3 | 537.4 |
| Equity ratio (in %) | 12.3 | 13.4 |
| Q1/2009 | Q1/2008 | |
| Employees (average) | 2,256 | 3,099 |
| Sales per employee (in EUR thousand) | 49.7 | 70.8 |
GROUP INTERIM MANAGEMENT REPORT
09 II Overview of Business Development
18 IV Risk Report
Dear shareholders, business associates, and employees,
SAF-HOLLAND continues to combat an extremely negative market trend. The international economic crisis retains a firm grip on the market for commercial vehicles. In Europe, America, and Asia, demand for trucks and trailers fell sharply in the first quarter of 2009. The only exceptions to this trend are manufacturers of specialty vehicles such as tanker trucks and tanker semitrailers, freezers, or flatbed trucks. Manufacturers of standard trucks and trailers, in contrast, have responded with extended plant vacations over Christmas, New Year, and Easter and with other production cuts such as reduced working hours. Moreover, substantial inventories of trucks and trailers as well as spare parts had been built up in the meantime.
Against this backdrop, the measures we initiated last fall to boost efficiency and reduce costs have had a positive effect. Compared with the first quarter of 2008, we have been able to keep our gross margin nearly constant. Due to the sharp decline in sales, however, our business activities nevertheless resulted in a loss for the first quarter. Thus, we are working intensively to lower the profit threshold even further. We are doing so by constantly adjus ting capacities, partly by means of reduced working hours and plant consolidation. In ad dition, we are continuing to reduce overhead costs. In discussions with employee representatives, we are also identifying additional ways to achieve cost savings. Thus, we already achieved cost savings of EUR 16 million in this way in 2008. A further EUR 43 million is to be saved in 2009.
Furthermore, we are ensuring liquidity by consistently reducing our inventories. We have continued to made good progress toward one of our principal targets, to reduce net working capital, in the first quarter of 2009.
These endeavors have also helped us to secure the financial future of SAF-HOLLAND. After we had negotiated a standstill agreement with our lending banks in February 2009, the preliminary opinion by the auditing firm KPMG confirmed that we are capable of restructuring. We expect to be able to secure long-term financing in the course of the current quarter.
In times of crisis, confidence is just as important a capital good as production facilities and committed employees. The SAF-HOLLAND management and an important customer have documented their confidence in the Company by providing it with loans totaling EUR 5.8 million.
We are not yet making a specific forecast for the current fiscal year. All that can be said for sure is that sales will be clearly lower than last year, which included a very strong first half. In the US, the market has reached a historically low level. However, initial positive signs of stabilization are apparent in the aftermarket sector in Europe and the United States. Truck business has also stabilized in North America. Towards the end of the year, the trend may improve in the truck segment in the US. We anticipate pull-forward effects there due to new statutory exhaust emissions regulations from January 1, 2010.
The conviction that SAF-HOLLAND is positioned correctly has remained steady, even in the current difficult market situation. We are integrating the two acquisitions we made last year in China and Europe swiftly and on schedule. They have enabled us to extend our product range and our worldwide presence. We are continuing to boost efficiency and to reduce costs and capital lock-up. All of the measures we undertake in times of crisis will pay a double dividend when the market recovers. The signs of recovery are slight as of yet, but the fact is that when economic recovery does kick in, the commercial vehicles industry is likely to be one of the first industries to benefit.
Best regards,
Dr. Reiner Beutel Chief Executive Officer (CEO)
05
• Preliminary opinion from KPMG confirms the Company's restructuring ability.
Shareholder Structure Figures in %
Germany's DAX index ended the quarter on March 31, 2009 at 4,084.76 points, or 15.1% lower than the close of business for 2008. The SDAX index ended the quarter at 2,374.46 points and was also down on the 2008 year-end figure of 2,800.73 points.
The SAF-HOLLAND share commenced trading in 2009 at EUR 1.20, reached a low of EUR 0.35 on February 25, 2009, and rose to EUR 1.44 as of March 31, 2009. The share's volatile performance was influenced – in addition to the general uncertainty on stock markets – by our discussions with the banks on adjusting our financing to the new market conditions. Once the standstill agreement was agreed with the consortium of lending banks, the share re gained value swiftly.
07
09 II OVERVIEW OF BUSINESS DEVELOPMENT
10 II.2 Major Events in the First Quarter
13 II.5 Business Development in the Business Units
15 II.6 Financing
15 II.8 Liquidity
17 II.11 Research and Development
SAF-HOLLAND S.A., hereinafter also referred to as SAF-HOLLAND, the Group, or the Company, is one of the world's leading manufacturers and providers of premium systems and components for commercial vehicles (trucks and trailers) as well as for buses and recreational vehicles. The product range encompasses axle and suspension systems, fifth wheels, coupling devices, kingpins, and landing legs. The Group, with its three Business Units – Trailer Systems, Powered Vehicle Systems, and Aftermarket – currently utilizes 20 production sites in Europe, North America, Brazil, Australia, China, and India. In addition, the Company operates a worldwide service network.
The Company was founded in December 2005 for the purpose of acquiring SAF Group, a European market leader in the manufacture and sale of axles and axle systems for the trailer industry. The acquisition was carried out indirectly via two intermediaries as of March 31, 2006. Similarly, the acquisition of the US-based Holland Group, an American market leader in components and systems for the truck and trailer industry, was executed via an inter mediary on December 18, 2006.
1) IMF, April 2009
Around the world, the economy is suffering from the most serious downturn since the 1929 economic crisis. Starting with the US real estate and financial crisis, all regions and nearly all industries are now affected. The International Monetary Fund1) expects economic performance to fall by 1.3% worldwide this year. While a decline of 2.8% is anticipated in the United States and of 4.2% in the Euro zone, Germany is likely to be hit much harder with an expected economic decline of 5.6%. A cyclical downturn of 1.3% is also forecast for Brazil, according to the latest figures published at the end of April. Growth is now only forecast for China (+6.5%), India (+4.5%), the Middle East (+2.5%), and Africa (+2.0%), but these rates of growth are significantly weaker than in the past. Experts expect the downturn to slow during the course of the year, with the International Mone tary Fund forecasting a slight upturn of 1.9% for next year. Only the US economy is expected to stagnate, whereas the cooling-off will continue at a slower rate in the Euro zone and in Germany. Brazil and Russia are to resume their growth, while China and India will grow more strongly once more.
Due to the economic crisis, demand for trucks and trailers has fallen sharply. In the first quarter of 2009, nearly 44% fewer trucks (over 16 tons) were newly registered in Europe than in the same period of the previous year.1) Leading trailer manufacturers in, for example, Germany report orders down by up to 90%. The trend is similar in North America, where truck production (Class 8) is expected to fall by 41%, though new exhaust emissions regulations in 2010 will provide a sales stimulus in the second half of the year. At the same time, end customers such as retail chains will step up pressure on trucking companies to moder nize their fleets. For this reason, Class 8 truck production in North America will regain mo mentum with significant growth of around 50% next year. Demand for trailers is likely to develop along similar lines. A sales slump of around 48% in the United States is expected to be followed by growth of around 82% next year.2)
In the first quarter of 2009, SAF-HOLLAND continued the measures initiated in the previous year to adjust the Company to the drastic decline in demand in the fourth quarter of 2008. The focus was on savings in material and production costs and in personnel and non-personnel expenses. In addition, we stepped up the reduction of current assets to secure liquidity. Inventories fell to EUR 77.9 million (12/31/2008: EUR 85.8 million). Our aim is to reduce inventories to 30 days' worth by the end of the year.
We constantly strive to improve our efficiency, including the relocation and closure of sites. In February, we announced the transfer of production from Monroe, North Carolina, to our existing plant in Wylie, Texas. Merging production of fifth wheels at a single site reduces our production costs and improves workflows and customer service. In Germany, we have responded to the sales decline by temporarily ceasing production at one of the two plants in Bessenbach, near Aschaffenburg. As long as demand remains at a low level, production is to be limited to one site. We are also continuing to consolidate sites in China by dissolving our joint ventures and limiting business activities to initially two production facilities.
The talks begun in November 2008 with the lead banks in the lending consortium to adjust our financing to the new framework conditions led to a standstill agreement in February 2009. A new financing concept is then to be agreed by the end of June.
With consolidated sales totaling EUR 112.1 million (previous year: EUR 219.3 million), the Group's adjusted earnings before interest and taxes (EBIT) was EUR -0.5 million (previous year: EUR 18.1 million). In view of the steep decline in world freight volumes, the slump in the trailer market in Europe, where it had boomed in recent years, weighed especially heavily on the result.
1) ACEA, April 2009
2) ACT, May 2009
SAF-HOLLAND has made headway regarding technology transfer between the former SAF in Europe and Holland in North America, where SAF-HOLLAND began as scheduled in Feb ruary to ship axle systems manufactured in-house to American customers. Prototype manufacture had begun in Warrenton, Missouri in November. As a first step, the Company plans to produce around 30,000 axles per year to replace axles previously sourced from a com petitor. As a result, we will be able to open up further market opportunities and im prove our earnings.
At the internationally important Mid-America Trucking Show in Kentucky in March 2009, SAF-HOLLAND exhibited the innovative integrated CBX40 suspension system – a further example of successful technology transfer. Combined with SAF-HOLLAND's disk brake technology, the CBX40 is a trailblazer in North America. In Europe, SAF-HOLLAND is a leading provider of axle systems with integrated disk brakes for trailers.
Since the beginning of this year, Daimler Trucks North America LLC, the largest manufacturer of heavy trucks in North America, has included the SAF-HOLLAND FWAL aluminum fifth wheel in its product range. With this listing, the aluminum fifth wheel is now available from all North American heavy truck manufacturers. SAF-HOLLAND developed this product in cooperation with Alcoa, the world market leader in aluminum processing. The FWAL fifth wheel is not only up to 40kg lighter in weight than comparable competing products, it also utilizes our NoLube technology, which eliminates the need for lubrication during servicing and maintenance of the fifth wheel. Along with the resulting environmental compatibility, it supports in particular the SAF-HOLLAND strategy of offering the customer products with low life-cycle costs.
At the beginning of February, changes in management took place. After Rudi Ludwig ended his successful five-year term as Chief Executive Officer on February 28, 2009 as scheduled, Dr. Reiner Beutel took over as his successor. Dr. Reiner Beutel has over 20 years' experience in the automotive supplies industry and is an expert on restructuring. From February 1, Dr. Reiner Beutel also joined the Board of Directors. Rudi Ludwig remains a member of the Board of Directors. In addition, effective January 31, 2009, Dr. Rolf Bartke stepped down as Chairman of the Board of Directors at his own request and for personal reasons. His successor since March 27 has been Bernhard Schneider, a member of the Board of Directors since July 16, 2006.
Demand for trucks and trailers continued to be weak in the first quarter after sales had fallen since October 2008 in Europe and since mid-2007 in North America. After a lengthy Christmas break, we began the New Year at a low sales level. Consolidated sales in the reporting period were nearly 50% down on the previous year at EUR 112.1 million (previous year: EUR 219.3 million). Adjusted for exchange rate effects, sales totaled EUR 105.2 million. European business accounted for 50.9% of Group sales (previous year: 71.4%), reflecting the recent sharp decline. North American business rose accordingly to 45.1% (previous year: 25.9%). Other regions increased their share to 4.0% (previous year: 2.7%).
High inventories of new trailers and trucks in Europe, under-utilized equipment at fleets, and high surplus stocks of axles and axle components held by OEM's and spare parts held by wholesalers, brought sales by European suppliers almost to a standstill. With high production volumes in the first half of 2008, manufacturers stepped up procurement of components significantly against the backdrop of booming demand, building up stockpiles. We expect, however, that inventory levels will be down to a normal level again by mid-year, which will give rise to the need to begin to purchase material. The effects of the financial and economic crisis have hit our European markets especially hard. In North America, sales have also declined, albeit less dramatically than in Europe due to an already weaker market trend over the past two years.
| Q1/2009 (exchange rate |
||||||
|---|---|---|---|---|---|---|
| in EUR million | Q1/2009 | adjusted) | Q1/2008 | |||
| Europe | 57.1 | 50.9% | 57.1 | 54.3% | 156.6 | 71.4% |
| North America | 50.5 | 45.1% | 44.1 | 41.9% | 56.8 | 25.9% |
| Other | 4.5 | 4.0% | 4.0 | 3.8% | 5.9 | 2.7% |
| Total | 112.1 | 100.0% | 105.2 | 100.0% | 219.3 | 100.0% |
| in EUR million | Q1/2009 | Q1/2009 (exchange rate adjusted) |
Q1/2008 | |||
|---|---|---|---|---|---|---|
| Trailer Systems | 47.2 | 42.1% | 45.4 | 43.2% | 158.7 | 72.3% |
| Powered Vehicle Systems | 26.7 | 23.8% | 24.0 | 22.8% | 17.7 | 8.1% |
| Aftermarket | 38.2 | 34.1% | 35.8 | 34.0% | 42.9 | 19.6% |
| Total | 112.1 | 100.0% | 105.2 | 100.0% | 219.3 | 100.0% |
The Company's earning power was affected by the dramatic downturn in sales, although savings in material costs as well as personnel and non-personnel expenses alleviated the effects on the result. In total, adjusted EBIT amounted to EUR -0.5 million (previous year: EUR 18.1 million). At 16.9%, the gross margin was almost on a par with the previous year's 17.5%. The adjusted profit/loss for the period was EUR -5.3 million (previous year: EUR 9.4 million). Adjusted earnings per share were EUR -0.26 (previous year: EUR 0.50).
EBIT was adjusted for the following effects that are not originally attributable to the operating business: write-downs resulting from the purchase price allocation and restructuring and integration costs.
| in EUR million | Q1/2009 | Q1/2008 |
|---|---|---|
| Loss/profit for the period | -8.3 | 7.6 |
| Taxes on income | -1.4 | 3.5 |
| Finance result | 6.9 | 5.0 |
| Depreciation and amortization from PPA1) | 1.8 | 1.5 |
| Restructuring and integration costs | 0.5 | 0.5 |
| Adjusted EBIT | -0.5 | 18.1 |
| as a percentage of sales | -0.4 | 8.3 |
| Depreciation and amortization | 3.6 | 3.1 |
| Adjusted EBITDA | 3.1 | 21.2 |
| as a percentage of sales | 2.8 | 9.7 |
| Depreciation and amortization | -3.6 | -3.1 |
| Finance result | -6.9 | -5.0 |
| Adjusted loss/profit before taxes | -7.4 | 13.1 |
| Taxes on income2) | 2.1 | -3.7 |
| Adjusted profit/loss for the period | -5.3 | 9.4 |
| as a percentage of sales | -4.7 | 4.3 |
| Number of shares3) | 20,702,275 | 18,837,375 |
| Adjusted earnings per share in EUR | -0.26 | 0.50 |
1) Purchase price allocation (PPA) from the acquisition of the SAF Group and the Holland Group in 2006 as well as Austin-Westran Machinery Co., Ltd and the current SAF-HOLLAND Verkehrstechnik GmbH in 2008.
| 2) A uniform tax rate of 28.59% was | |||
|---|---|---|---|
| assumed. |
3) Number of ordinary shares as of March 31.
II.5 Business Development in the Business Units
The course of business in the Trailer Systems Business Unit was affected in the first quarter by the very poor general market trend. The Company's most powerful growth motor until mid-2008, Trailer Systems' business was characterized by sales declines of up to 90% in Europe over the past three months. The markets for standard trailers have been hit especially hard, whereas demand for specialty trailers has remained somewhat stable. In addition to the effect of high stocks held by manufacturers and trucking companies in Europe in the reporting period, temporary plant closures in February by customers in both Europe and the United States put a damper on demand. In North America, the trailer market suffered from more moderate cuts than in Europe, but it did so from what was already a lower level.
In all, segment sales in the first three months of 2009 totaled EUR 47.2 million (previous year: EUR 158.7 million). The exchange rate-adjusted amount was EUR 45.4 million. The gross margin fell to -2.1% (previous year: 13.1%). This partly reflects surplus production capacities that are being swiftly reduced by the on-going structural measures. The Business Unit's share of total sales fell to 42.1% (previous year: 72.3%).
The Powered Vehicle Systems Business Unit benefited from sales development at SAF-HOLLAND Verkehrstechnik GmbH (formerly Georg Fischer Verkehrstechnik GmbH), acquired in 2008. A further positive factor that influenced the segment result was a high-margin government contract in the United States. Towards the end of this year, we anticipate a slight recovery in the US truck market triggered by the new emissions regulations that will come into force in 2010. Experience has shown that these stricter regulations lead to pull-forward effects.
The Business Unit boosted sales by 50.8% to EUR 26.7 million compared with the previous year's EUR 17.7 million. The exchange rate-adjusted figure was EUR 24.0 million. The gross margin rose significantly to 20.6% (previous year: 13.1%). Overall, the Powered Vehicle Systems Business Unit's share of the Company's total sales volume rose to 23.8% (previous year: 8.1%).
The Aftermarket Business Unit, like Trailer Systems, was also unable to escape the general market trend, yet the declines were much more moderate than in the OEM markets. By material price reduction and a better product mix, the Business Unit was able to improve its gross margin in spite of a more difficult environment. Both in Europe and in the United States, signs of a slight increase in order entry were apparent in March and April. Particularly in the USA, industry is beginning, after a lengthy lull in investment, to motivate fleet operators to renew their fleets in anticipation of improving freight activity. They have no desire to experience transport delays due to "out of service" issues. After service contracts were agreed with DAF Parts in 2008 and recently with Mercedes and Volvo, we are continuing our discussions with additional potential partners. We plan to expand our worldwide service network further. With the acquisition of the former Georg Fischer Verkehrstechnik in the fall of 2008, we see additional growth opportunities, including the spare parts business.
In the first three months of 2009, segment sales totaled EUR 38.2 million (previous year: EUR 42.9 million), or EUR 35.8 million after exchange rate adjustment. Its gross margin rose to 38.0% (previous year: 35.7%). The Aftermarket Business Unit increased its share of total Company sales to 34.1% (previous year: 19.6%). With the increasing number of installed axles in the market, this segment will continue to grow, particularly in Europe, and to gain importance for the Group as a stabilizing factor on sales and earnings.
| Powered Vehicle | ||||||||
|---|---|---|---|---|---|---|---|---|
| Trailer Systems | Systems | Aftermarket | ||||||
| Business Unit | Business Unit | Business Unit | Total | |||||
| in EUR million | Q1/2009 | Q1/2008 | Q1/2009 | Q1/2008 | Q1/2009 | Q1/2008 | Q1/2009 | Q1/2008 |
| Sales | 47.2 | 158.7 | 26.7 | 17.7 | 38.2 | 42.9 | 112.1 | 219.3 |
| Cost of sales | -48.2 | -137.8 | -21.2 | -15.4 | -23.7 | -27.6 | -93.1 | -180.8 |
| Gross operating result | -1.0 | 20.9 | 5.5 | 2.3 | 14.5 | 15.3 | 19.0 | 38.5 |
| As a percentage of sales | -2.1 | 13.1 | 20.6 | 13.1 | 38.0 | 35.7 | 16.9 | 17.5 |
The focus in the first quarter of 2009 was on adjusting financing to the changed economic framework conditions. Against the background of heavy demand in Europe in the first half of 2008, in February 2008, we negotiated a new line of credit for EUR 325 million at favorable interest rates in return for agreeing to maintain certain key financial figures. In view of the sharp fall in demand in the fourth quarter of 2008 and the difficulty of forecasting further sales trends, the Group negotiated a standstill agreement with the bank consortium on February 27, 2009.
The agreement includes the following elements:
In addition, management made a EUR 1.3 million loan available during the reporting period. The loan is unsecured and has a term of 24 months. SAF-HOLLAND received an additional EUR 4.5 million in funding in the form of a loan provided by a longstanding customer. This loan agreement with a term of 18 months provides for interest to be paid at rates and on conditions that are customary in banking. Repayment is due in full on maturity, and the loan is secured by the use of non-core assets as collateral.
SAF-HOLLAND invested around EUR 2.0 million (previous year: EUR 4.7 million) in the first quarter of 2009. As last year's two acquisitions – the landing leg business of Austin-Westran and the former Georg Fischer Verkehrstechnik GmbH – have now completed the product portfolio, there were few investments in the reporting period. The addition of EUR 2.0 million in fixed assets was due mainly to delayed effects from investments in 2008. Investments in 2009 will amount to less than EUR 10 million.
As of the reporting date of March 31, 2009, SAF-HOLLAND held cash and cash equivalents totaling EUR 15.5 million (12/31/2008: EUR 8.6 million). The main reason was the fall in working capital requirement due mainly to the reduction of inventories to EUR 77.9 million (12/31/2008: EUR 85.8 million). As of September 30, 2009, inventories had amounted to EUR 111.9 million. The Company is reducing inventories continuously in order to adjust them to the decline in demand. The aim is to keep inventories down to the equivalent of one month's sales (30 days). Inventories had been built up in view of brisk demand in the first half of 2008, plant consolidations and closure in North America, and our own axle production commencing in North America. As of the reporting date, net working capital amounted to 12.2% of sales. The target is 9% of sales.
Net cash flow from operating activities before income tax payments totaled EUR 5.5 million (previous year: EUR 2.3 million). Cash flow from investing activities amounted to EUR -1.7 million (previous year: EUR -4.5 million). Cash flow from financing activities in the reporting period was EUR 3.9 million (previous year: EUR -3.8 million) and was char acterized by higher interest payments, the management and Board of Directors loan, the customer loan, and greater utilization of the credit line. Higher interest payments were a result of an increase in the interest rate margin due to the standstill agreement and of greater utilization of the credit line.
As of the reporting date, total assets were down to EUR 536.3 million (12/31/2008: EUR 537.4 million). Non-current assets at EUR 355.4 million were on a par with the previous year (12/31/2008: EUR 350.5 million). The decline in current assets was due mainly to lower inventories totaling EUR 77.9 million (12/31/2008: EUR 85.8 million) and to lower trade re ceivables of EUR 71.6 million (12/31/2008: EUR 82.3 million), the result of falling sales. Cash and cash equivalents rose to EUR 15.5 million (12/31/2008: EUR 8.6 million). Equity capital fell, mainly because of the loss for the period, to EUR 65.9 million (12/31/2008: EUR 72.1 million). Liabilities arising from interest-bearing loans and borrowings rose by a total of EUR 14.0 million to EUR 326.4 million (12/31/2008: EUR 312.4 million). That led to an increase in net indebtedness to EUR 310.8 million (12/31/2008: EUR 303.8 million). Due to the decline in sales, trade payables fell to EUR 50.5 million (12/31/2008: EUR 60.4 million). In view of restructuring expenses and costs for staff reductions, other provisions totaled EUR 17.1 million (12/31/2008: EUR 19.1 million). The equity ratio was 12.3% (12/31/2008: 13.4%).
In the first quarter of 2009, SAF-HOLLAND continued to adjust its capacities to the fall in demand and reduced its personnel expenses further. In the process, the Company is relying on a wide range of instruments to limit inevitable staff reductions.
As of the reporting date of March 31, 2009, the Group's employees totaled 2,256 (previous year: 3,099). Measures undertaken in the second half of 2008 led to a fall of around 600 in the number of employees. In addition, contractor agreements and temporary labor contracts were not renewed. The acquisitions in 2008 of the landing leg business of Austin-Westran and the present SAF-HOLLAND Verkehrstechnik GmbH led to an addition of 256 em ployees last year, excluding temporary staff.
In order to limit further staff reductions in Europe, the Company is now relying mainly on reduced working hours and salary reductions. In the first quarter of 2009, employees did not work on two days per week, with the German Federal Employment Office bearing the cost for part of the wages lost. In the second quarter, reduced working hours are being extended to three days per week. Furthermore, as of March 31, 2009, 111 employees were taken over by a transitional company. Nonetheless, the number of jobs is likely to fall an additional 100 in the course of fiscal 2009. Wherever possible, the Company hopes to avoid layoffs. The package of cost saving measures also includes forgoing three days of paid vacation and salary components for managerial staff. The management and exempt employees have agreed to forgo payment of their annual bonus for 2008. In addition, salary reductions at all levels have been implemented in both Europe and North America.
Our strategy is to complete our product range through innovative products, thereby im proving our already strong market position. Expenditure for research and development totaled EUR 3.0 million in the first quarter (previous year: EUR 2.7 million). The R&D ratio was 2.7% (previous year: 1.2%). Our main focus is on technology transfer between North America and Europe, the successes of which are now becoming apparent: manufacturing of axle systems has now commenced in the United States and fifth wheel technology in Europe. With the start of our own axle production, the Group is opening up substantial additional sales opportunities now that the axles are no longer purchased from external manufacturers. At the same time, the Company is rounding out its product portfolio globally and position ing itself well to begin leveraging further sales potential.
Talks begun in October with the leaders of the bank consortium, UniCredit and Dresdner Kleinwort, regarding a new agreement of a credit line for EUR 325 million, adjusted to the current market situation, resulted in a standstill agreement in February. On February 27, 2009, it was accepted by the entire bank consortium. The agreement provided, among other things, for an expert restructuring opinion that was commissioned from auditors KPMG. After presentation of the preliminary findings on April 20, 2009, and a further version on May 25, 2009, in a second step the consortium of banks will approve by the beginning of June. The interim restructuring opinion confirms that the Group is capable of restructuring financially, subject to the stated conditions. The opinion is based on sensitized corporate planning that takes into account the most extensive negative development conceivable during the planning timeline. The main conditions of the preliminary findings on May 25, 2009, are as follows:
In addition, the restructuring opinion of KPMG states that sustainable results and competitive position can be achieved, based on the planning as presented and the market position of the SAF-HOLLAND Group.
Management expects to be able to negotiate a new financing concept with the leaders of the bank consortium, UniCredit and Dresdner Kleinwort, by June 19, 2009 in accordance with the requirements of the standstill agreement.
Compared with the risk profile at the end of 2008 fiscal year, as outlined in the risk report contained in the annual report, the Group has experienced no change. The consolidated financial statements of SAF-HOLLAND are predicated on the assumption that business operations can be continued in the future ("going concern"). This assessment was subject to one significant uncertainty factor, which currently still cannot be conclusively assessed. As of the balance sheet date and as of March 31, 2009, the Group's long-term financing had not yet been secured. Despite this uncertainty, the Company assumes that SAF-HOLLAND S.A. will be able to continue its business operations and satisfy its payment obligations. We have taken numerous measures in order to adapt the Company and its cost situation to the new economic conditions. The Group can implement the steps required by the preliminary expert opinion on restructuring. Thus, we are fulfilling important prerequisites for the successful conclusion of talks with the leaders of the bank consortium regarding a new financing concept.
All additional risks that can be directly influenced by the Group are manageable. The preservation of liquidity is the current focus of risk management.
We expect demand to continue to be poor this year. In the truck segment, we anticipate a slight improvement in orders towards the end of the year in the USA due to new emissions regulations that come into force at the beginning of 2010. In Europe, no change in the market situation is as yet foreseeable from today's perspective. A more positive trend is apparent in the aftermarket segment. Both in North America and in Europe, the spare parts business seems to be taking a slight turn for the better as dealers' inventories are being depleted. In the past, the aftermarket business has been an early indicator of further developments in the truck and trailer sector. An initial stabilization is also apparent in the United States.
Overall, demand continues to fluctuate and is characterized by orders placed with short lead-times. Cyclical cooling-off continues, accompanied by a decline in economic output in many regions. In view of these framework conditions, SAF-HOLLAND's further business development cannot be forecast precisely. From the present vantage point, we assume that 2009 sales will be well below the previous year's. Earnings will, therefore, be reduced significantly, especially as the measures initiated can only affect results as they are implemented during the year. After savings of EUR 16 million were reached in 2008, costs are to fall by a further EUR 43 million this year.
In the long term, demand for transport capacities will continue to increase in a globalized economy. On the basis of our worldwide presence and our high-quality, comprehensive product range, we will benefit from this as soon as demand for trucks and trailers recovers.
| kEUR | Notes | 01/01/09–03/31/09 | 01/01/08–03/31/08 |
|---|---|---|---|
| Sales | (5) | 112,060 | 219,276 |
| Cost of sales | -93,126 | -180,817 | |
| Gross profit | 18,934 | 38,459 | |
| Other income | 335 | 341 | |
| Selling expenses | -10,378 | -10,556 | |
| Administrative expenses | -9,075 | -9,696 | |
| Research and development costs | -3,037 | -2,711 | |
| Operating loss/profit | (5) | -3,221 | 15,837 |
| Finance income | 112 | 156 | |
| Finance expenses | -7,042 | -5,049 | |
| Share of net profit of investments accounted for using the equity method |
447 | 220 | |
| Loss/profit before tax | -9,704 | 11,164 | |
| Income tax income/expense | (6) | 1,365 | -3,534 |
| Loss/profit for the year | -8,339 | 7,630 | |
| Other comprehensive income | |||
| Exchange differences on translation of foreign operations | 4,950 | -1,216 | |
| Changes in fair values of derivatives designated as hedges, recognized in equity |
(13) | -101 | -2,826 |
| Income taxes on valuation adjustments offset directly against equity |
(8) | -2,669 | 905 |
| Other comprehensive income, net of tax | 2,180 | -3,137 | |
| Comprehensive income for the year, net of tax | -6,159 | 4,493 | |
| Attributable to equity holders of the parent | -6,159 | 4,493 | |
| Earnings per share in EUR | (9) | -0.40 | 0.40 |
| kEUR | Notes | 03/31/09 | 12/31/08 |
|---|---|---|---|
| ASSETS | |||
| Non-current assets | 355,357 | 350,537 | |
| Goodwill | 56,112 | 54,284 | |
| Intangible assets | 150,553 | 148,321 | |
| Property, plant, and equipment | 118,250 | 117,744 | |
| Investments accounted for using the equity method | 11,463 | 11,046 | |
| Financial assets | 140 | 140 | |
| Other non-current assets | 3,606 | 2,738 | |
| Deferred tax assets | 15,233 | 16,264 | |
| Current assets | 178,096 | 183,948 | |
| Inventories | 77,914 | 85,812 | |
| Trade receivables | 71,560 | 82,348 | |
| Other current assets | 10,569 | 4,880 | |
| Income tax assets | 2,556 | 2,351 | |
| Cash and cash equivalents | (7) | 15,497 | 8,557 |
| Non-current assets classified as held for sale | 2,887 | 2,887 | |
| Total assets | 536,340 | 537,372 | |
| EQUITY AND LIABILITIES | |||
| Equity attributable to equity holders of the parent | 65,911 | 72,070 | |
| Subscribed share capital | 207 | 207 | |
| Share premium | 106,454 | 106,454 | |
| Legal reserve | 19 | 19 | |
| Retained earnings | -28,896 | -20,686 | |
| Accumulated other comprehensive income | -11,873 | -13,924 | |
| Non-current liabilities | 73,270 | 66,213 | |
| Pensions and other similar benefits | 12,160 | 11,843 | |
| Other provisions | 5,065 | 5,167 | |
| Interest bearing loans and borrowings | (12) | 5,753 | – |
| Finance lease liabilities | 414 | 508 | |
| Other financial liabilities | (13) | 11,711 | 10,020 |
| Other liabilities | 519 | 499 | |
| Deferred tax liabilities | 37,648 | 38,176 | |
| Current liabilities | 397,159 | 399,089 | |
| Pensions and other similar benefits | 2,870 | 2,712 | |
| Other provisions | 12,016 | 13,892 | |
| Income tax liabilities | 2,853 | 2,813 | |
| Interest bearing loans and borrowings | (12) | 320,588 | 312,396 |
| Finance lease liabilities | 435 | 475 | |
| Trade payables | 50,480 | 60,443 | |
| Other liabilities | 7,917 | 6,358 | |
| Total liabilities and equity | 536,340 | 537,372 |
Consolidated Statement of Changes in Equity
| 2009 | ||||||||
|---|---|---|---|---|---|---|---|---|
| Attributable to equity holders of the parent | ||||||||
| Accumulated other com prehensive |
||||||||
| kEUR | Subscribed share capital |
Share premium |
Legal reserve |
Retained earnings |
income (Note 8) |
Total equity |
||
| As of 01/01/2009 | 207 | 106,454 | 19 | -20,686 | -13,924 | 72,070 | ||
| Comprehensive income for the year |
– | – | – | -8,339 | 2,180 | -6,159 | ||
| Other reclassifications | – | – | – | 129 | -129 | – | ||
| As of 03/31/2009 | 207 | 106,454 | 19 | -28,896 | -11,873 | 65,911 |
| As of 03/31/2008 | 188 | 93,146 | – | 19,947 | -631 | 112,650 | |||
|---|---|---|---|---|---|---|---|---|---|
| Comprehensive income for the year |
– | – | – | 7,630 | -3,137 | 4,493 | |||
| As of 01/01/2008 | 188 | 93,146 | – | 12,317 | 2,506 | 108,157 | |||
| kEUR | Subscribed share capital |
Share premium |
Legal reserve |
Retained earnings |
Accumulated other com prehensive income (Note 8) |
Total equity |
|||
| Attributable to equity holders of the parent | |||||||||
| 2008 |
| kEUR Notes |
01/01/09 –03/31/09 |
01/01/08 –03/31/08 |
|---|---|---|
| Cash flow from operating activities Loss/profit before tax |
-9,704 | 11,164 |
| - Finance income |
-112 | -156 |
| + Finance expenses |
7,042 | 5,049 |
| - Share of net profit of investments accounted for using the equity method |
-447 | -220 |
| + Amortization and depreciation of intangible assets and |
||
| property, plant, and equipment | 5,392 | 4,607 |
| +/- Allowance/write-up of current assets | 235 | -245 |
| + Loss on disposal of property, plant, and equipment |
20 | – |
| + Dividends from investments accounted for using the equity method |
16 | – |
| Profit before change of net working capital | 2,442 | 20,199 |
| - Change in other provisions and pensions |
-2,659 | -1,639 |
| +/- Change in inventories | 10,005 | -8,298 |
| +/- Change in trade receivables and other assets | 5,850 | -20,389 |
| -/+ Change in trade payables and other liabilities | -10,187 | 12,406 |
| Cash flow from operating activities before income tax paid | 5,451 | 2,279 |
| - Income tax paid (6) |
-359 | -1,643 |
| Net cash flow from operating activities | 5,092 | 636 |
| Cash flow from investing activities | ||
| - Acquisition of subsidiaries net of cash acquired |
-346 | – |
| - Purchase of property, plant, and equipment |
-1,461 | -4,584 |
| - Purchase of intangible assets |
-532 | -105 |
| - Purchase of investments accounted for using the equity method |
-11 | – |
| + Proceeds from sales of property, plant, and equipment |
640 | 12 |
| + Interest received |
15 | 156 |
| Net cash flow form investing activities | -1,695 | -4,521 |
| Cash flow from financing activities | ||
| + Proceeds from capital increase net of transaction costs |
– | -5461) |
| + Proceeds from Management and Board of Directors loan |
1,244 | – |
| - Payments for finance lease |
-104 | -116 |
| - Interest paid |
-5,409 | -3,113 |
| - Repayments of current and non-current financial liabilities (12) |
-2,084 | -256,631 |
| + Proceeds from current and non-current financial liabilities (12) |
10,270 | 256,631 |
| Net cash flow from financing activities | 3,917 | -3,775 |
| Net increase/decrease in cash and cash equivalents | 7,314 | -7,660 |
| Net foreign exchange difference | -374 | -344 |
| Cash and cash equivalents at the beginning of period (7) |
8,557 | 27,757 |
| Cash and cash equivalents at the end of period (7) |
15,497 | 19,753 |
1) Payments for expenses relating to the IPO in 2007.
SAF-HOLLAND S.A. (the "Company") was incorporated on December 21, 2005 under the legal form of a "Société Anonyme" according to Luxembourg law. The registered office of the Company is in Luxembourg. The shares of the Company are listed in the Prime Standard of the Frankfurt Stock Exchange.
The consolidated financial statements of SAF-HOLLAND S.A. and its subsidiaries (the "Group") have been prepared in accordance with the International Financial Reporting Standards (IFRS), as adopted by the European Union and in effect as of the closing date.
The consolidated interim financial statements for the first quarter of 2009 have been prepared in accordance with IAS 34 "Interim Financial Reporting." As a rule, the same accounting policies and consolidation methods were applied as in the Group's annual financial statements for the fiscal year 2008. Therefore, the consolidated interim financial statements should be read in conjunction with the Group's annual financial statements as of December 31, 2008. New or revised standards and interpretations, of which the application is required beginning in the fiscal year 2009, are exceptions to the accounting principles stated in the 2008 annual report.
According to this standard, a company is required to disclose all changes in equity from transactions with owners in their capacity as owners separately from other changes in equity. The other changes in equity are disclosed in the statement of comprehensive income. According to the previous standard, these changes in equity had been presented in the statement of changes in equity. The Group has decided to present total comprehensive income in a single statement. In the future, the income statement will be referred to as the statement of comprehensive income and supplemented by the component "other comprehensive income." The presentation of the comparison period was modified accordingly.
Other relevant changes and revisions, which similarly must be applied as of January 1, 2009, are described in the 2008 annual report. However, they have no material impact on the consolidated interim financial statements.
The consolidated financial statements of SAF-HOLLAND S.A. were prepared under the assumption that the Company is a going concern. In general, significant uncertainties exist concerning the Company's continued existence which cannot be assessed conclusively at this time. The assessment of the Company's continued existence is mainly subject to uncertainty as to whether a new long-term credit agreement can be negotiated with the lending banks upon the maturity of the standstill agreement. There is also uncertainty as to whether the conditions specified in the expert opinion on the Group's capacity for financial restructuring can be fulfilled. Further details regarding the current status of negotiations are provided in Group Interim Management Report.
During the preparation of the condensed consolidated interim financial statements, man agement must make assumptions and estimates which affect the reported amounts of assets, liabilities, income, expenses, and contingent liabilities as of the reporting date. In certain cases, actual amounts may deviate from these estimates.
Expenses and income incurred irregularly during the fiscal year were brought forward or deferred if it would also be appropriate to do so at the end of the fiscal year.
The consolidated interim financial statements and the interim management report have neither been audited nor reviewed by an auditing firm.
Seasonal effects during the year can result in variations in sales and the resulting profits. Please see the Group Interim Management Report for further details regarding earnings development.
Compared to December 31, 2008, the scope of consolidation has not changed.
For management purposes, the Group is organized into customer-oriented Business Units based on products and services. The three reportable operating segments are the Business Units Trailer Systems, Powered Vehicle Systems, and Aftermarket. There has been no change in the division of operating segments since December 31, 2008. For more information, please see the notes of the 2008 annual report.
Management assesses the performance of the operating segments based on adjusted EBIT. This measurement basis does not include any extraordinary items.
| Adjusted EBIT | -481 | 18,054 |
|---|---|---|
| Restructuring and integration costs | 540 | 497 |
| Additional depreciation and amortization from PPA | 1,753 | 1,500 |
| EBIT | -2,774 | 16,057 |
| Share of net profit of investments accounted for using the equity method | 447 | 220 |
| Operating loss/profit | -3,221 | 15,837 |
| kEUR | 01/01/09–03/31/09 | 01/01/08–03/31/08 |
Information on segment sales and earnings for the period from January 1 to March 31:
| 2009 | |||||
|---|---|---|---|---|---|
| Business Units | |||||
| Trailer | Powered Vehicle |
Adjustments and |
|||
| kEUR | Systems | Systems | Aftermarket | eliminations | Consolidated |
| Sales | 47,133 | 26,708 | 38,219 | – | 112,060 |
| Adjusted EBIT | -9,615 | 2,621 | 7,815 | -1,302 | -481 |
| 2008 | |||||
|---|---|---|---|---|---|
| Business Units | |||||
| kEUR | Trailer Systems |
Powered Vehicle Systems |
Aftermarket | Adjustments and eliminations |
Consolidated |
| Sales | 158,694 | 17,733 | 42,849 | – | 219,276 |
| Adjusted EBIT | 11,570 | 515 | 6,373 | -404 | 18,054 |
Adjustments and eliminations include expenses of the parent companies as well as other expenses and income which are not allocated to any Business Unit.
Please see the Group Interim Management Report regarding earnings development.
No presentation of assets by operating segment is provided since no material changes have occurred since December 31, 2008.
The major components of income taxes are as follows:
| of comprehensive income | 1,365 | -3,534 |
|---|---|---|
| Income tax reported in the consolidated statement | ||
| Deferred income taxes | 1,841 | 5 |
| Current income taxes | -476 | -3,539 |
| kEUR | 01/01/09–03/31/09 | 01/01/08–03/31/08 |
The effective tax rate in the first quarter of 2009 was 14.07%, compared to 31.66% in the first quarter of 2008.
| Total | 15,497 | 8,557 |
|---|---|---|
| Short-term deposits | 870 | 631 |
| Cash at banks and on hand | 14,627 | 7,926 |
| kEUR | 03/31/09 | 03/31/08 |
| Total | 4,849 | -2,669 | 2,180 | -4,042 | 905 | -3,137 |
|---|---|---|---|---|---|---|
| Changes in fair values of derivatives designated as hedges, recognized in equity |
-101 | -2 | -103 | -2,826 | 905 | -1,921 |
| Exchange differences on translation of foreign operations |
4,950 | -2,667 | 2,283 | -1,216 | – | -1,216 |
| kEUR | Before tax amount |
Tax expense(-)/ benefit |
Net of tax amount |
Before tax amount |
Tax expense(-)/ benefit |
Net of tax amount |
| 03/31/09 | 03/31/08 |
Earnings per share is calculated by dividing the result for the period attributable to shareholders of SAF-HOLLAND S.A. by the average number of shares outstanding. Earnings per share can be diluted by potential ordinary shares. Newly issued or repurchased shares are taken into account on a pro rata basis during the period in which they are in circulation.
| Earnings per share | EUR | -0.40 | 0.40 |
|---|---|---|---|
| Weighted average number of shares outstanding | thousands | 20,702 | 18,837 |
| Result of the period | kEUR | -8,339 | 7,630 |
| Ergebnis je Aktie | 03/31/09 | 03/31/08 |
No dilutive effects occurred during the period under review or in the comparison period for 2008.
When his contract expired on February 28, 2009, CEO Mr. Rudi Ludwig resigned from operational business for personal reasons and at his own request. He remains a member of the Board of Directors. Dr. Reiner Beutel was appointed to succeed him on the Management Board as CEO.
With effect from February 1, 2009, Dr. Reiner Beutel was newly appointed to the Board of Directors. In addition, Dr. Rolf Bartke, previously Chairman of the SAF-HOLLAND S.A. Board of Directors, resigned from the Board as of January 31, 2009 for personal reasons and at his own request. On March 27, 2009, Mr. Bernhard Schneider was elected as Chairman of the Board of Directors as the successor of Dr. Rolf Bartke.
Further details regarding loans granted in February 2009 by members of management and the Board of Directors are provided in Note 12.
Transactions with related parties and companies in which the key management personnel of the Group hold key management positions
| Q1/2009 | Q1/2008 | ||||
|---|---|---|---|---|---|
| kEUR | Sales to related parties |
Purchases from related parties |
Sales to related parties |
Purchases from related parties |
|
| Jinan SAF AL-KO Axle Co., Ltd. | 58 | – | 174 | 191 | |
| SAF AL-KO Vehicle Technology Yantai Co., Ltd. | – | 57 | 2 | 306 | |
| SAF-HOLLAND Nippon, Ltd. | 23 | – | 67 | – | |
| Lakeshore Air LLP | – | 35 | – | 66 | |
| FWI S.A. | – | 3,462 | – | 5,203 | |
| Irwin Seating Company1) | 218 | – | 276 | – | |
| 299 | 3,554 | 519 | 5,766 | ||
1) The Irwin Seating Company is a company in which a member of the Group's management holds a key management position.
29
| 03/31/09 | 12/31/08 | |||
|---|---|---|---|---|
| kEUR | Amounts owed by related parties |
Amounts owed to related parties |
Amounts owed by related parties |
Amounts owed to related parties |
| Jinan SAF AL-KO Axle Co., Ltd. | 1,183 | – | 1,620 | 5 |
| SAF AL-KO Vehicle Technology Yantai Co., Ltd. | 631 | 406 | 555 | 350 |
| SAF-HOLLAND Nippon, Ltd. | 15 | 234 | 61 | – |
| Lakeshore Air LLP | – | – | – | 25 |
| FWI S.A. | – | 160 | – | 921 |
| Irwin Seating Company | 35 | – | 125 | – |
| 1,864 | 800 | 2,361 | 1,301 |
Please see the Group Interim Management Report for further explanations of the cash flow statement.
| Non-current | Current | Total | ||||
|---|---|---|---|---|---|---|
| kEUR | 03/31/09 | 12/31/08 | 03/31/09 | 12/31/08 | 03/31/09 | 12/31/08 |
| Interest bearing collateralized loans | – | – | 313,820 | 305,869 | 313,820 | 305,869 |
| Management and Board of Directors loans |
1,244 | – | – | – | 1,244 | – |
| Bank overdrafts | – | – | 4,620 | 4,539 | 4,620 | 4,539 |
| Accrued interest | 9 | – | 1,503 | 1,347 | 1,512 | 1,347 |
| Other loans | 4,500 | – | 645 | 641 | 5,145 | 641 |
| Total | 5,753 | – | 320,588 | 312,396 | 326,341 | 312,396 |
In order to improve the liquidity situation, additional loan agreements were arranged with members of management and the Board of Directors as well as a longstanding customer in Europe in February 2009. The credit agreement with the customer for EUR 4.5 million has a term of 18 months. The interest rate consists of the prevailing Euribor rate plus a 2% margin. Certain assets, which are not considered as belonging to the core business, serve as collateral for the loan. The management and Board of Director loans for originally EUR 1.3 million have a term of 24 months. The interest rate is 10%. No collateral was provided for the loans.
On February 19, 2008, SAF-HOLLAND S.A. concluded an agreement with a consortium of banks that replaced the previous LBO financing arrangement and ensured a supply of short- and long-term finance at more favorable interest rates. The agreed credit line has a total volume of EUR 325 million and a five-year term. The agreement consists of a Euro tranche (the A1 facility), a US-Dollar tranche (the A2 facility), and a multi-currency revolving credit line (the B facility). These tranches are shown in the following table:
| 03/31/09 | |||||
|---|---|---|---|---|---|
| kEUR | Amount drawn under the term loans |
Nominal value after deducting incidental financing costs |
Available facility | ||
| Facility A1 | 75,036 | 74,995 | 75,036 | ||
| Facility A2 | 65,431 | 65,371 | 65,431 | ||
| Facility B | 173,579 | 173,454 | 185,000 | ||
| 314,046 | 313,820 | 325,467 | |||
As a result of the consortium credit agreement reached on February 19, 2008, the Company committed itself to maintaining the following financial covenants:
Due to changing markets since the fourth quarter of 2008, the Group was unable to maintain the financial covenants as of December 31, 2008 and March 31, 2009. Failure to do so generally entitles the bank consortium to call in the loans. The negotiations begun with the bank consortium to adjust the credit conditions to the altered economic environment led to the conclusion of a standstill agreement which covers a period until June 19, 2009.
The standstill agreement encompasses the following core elements:
Extensive granting of guarantees in the form of commercial real estate mortgages, pledging of Group bank accounts, and the assignment of other assets as security.
Preparation and presentation of an expert restructuring opinion by June 3, 2009 (the deadline was extended from May 5, 2009 to June 3, 2009) that describes the Group's financial restructuring ability. The auditing firm KPMG has been commissioned to prepare the opinion.
The Group Interim Management Report contains additional details regarding the expert restructuring opinion and management's view of the Group as a going concern.
The Group is exposed to interest rate risks as a result of its financing activities. In order to hedge the resulting cash flow risk, the Group holds (unchanged since December 31, 2008) interest rate swaps as well as prolongation options for these swaps.
| The fair value of derivatives as of the balance sheet date are as follows: | |
|---|---|
| ---------------------------------------------------------------------------- | -- |
| Fair value as of 03/31/09 | 4,904 | 6,807 | 11,711 |
|---|---|---|---|
| Foreign currency translation | 231 | 274 | 505 |
| Changes recognized in profit or loss (before tax) | -145 | 1,230 | 1,085 |
| Changes recognized in equity (before tax) | 101 | – | 101 |
| Fair value as of 01/01/09 | 4,717 | 5,303 | 10,020 |
| Interest rate swaps |
Prolongation option for interest rate swaps |
Total |
Significant events between the end of the quarter and the publication of this report are described in the Group Interim Management Report as of March 31, 2009. No further material events have occurred since the reporting date.
Adjusted EBIT: Earnings before interest and taxes (EBIT) is adjusted for special items, such as depreciation and amortization from purchase price allocations, impairment of goodwill and intangible assets as well as restructuring and integration costs.
Average sales per employee: Sales/average employees.
Business Units: For management purposes, the Group is organized into customer-oriented Business Units (Trailer Systems, Powered Vehicle Systems, and Aftermarket).
Effective income tax rate: Income tax/earnings before tax x 100.
Equity ratio: Equity/total assets x 100.
Fair value: Amount obtainable from the sale in an arm's length transaction between knowledgeable, willing parties.
Free float: The free float of a public company is an estimate of the proportion of shares that are not held by major owners.
IFRS/IAS: (International Financial Reporting Standards/International Accounting Standards): The standard international accounting rules are intended to make company data more comparable. Under the EU resolution, accounting and reporting at exchange-listed companies must be done in accordance with these rules.
Inventory turnover rate: Average inventories/cost of sales per day.
Net working capital: Current assets minus cash and cash equivalents minus other provisions minus income tax liabilities minus trade payables minus other current liabilities.
Prime Standard: Prime Standard is a market segment of the German Stock Exchange that lists German companies which comply with international transparency standards.
R&D ratio: R&D cost/sales x 100.
SDAX: The SDAX is the selection stock market index for 50 smaller companies in Germany, "small caps".
Mounts with the kingpin and serves to secure the semi-trailer to the tractor unit. In addition to its traditional products, SAF-HOLLAND manufactures technical specialties such as a lubricant-free fifth wheel and especially lightweight aluminum designs.
The suspension creates the link between the axle and the ve hicle in order to compensate for road irregularities and improve maneuv era bi lity. The SAF-HOLLAND suspension system with its modular design can be used for up to three interlinked powered axles. Each axle is suspended individually. Suitable for gross vehicle weights of between 10 and 40 tons.
Mounts on the semitrailer and couples with the tractor fifth wheel. SAF-HOLLAND products are sold around the world and are among the safest on the market.
Retractable legs that support the front of a semi-trailer when it is not secured to the tractor unit. SAF-HOLLAND landing legs have a special coating that increases their ser vice life significantly.
INTRADISCplus INTEGRAL is a unique axle system for trailers, which consists of the axle itself fitted with a disk
brake and the air suspension system. Under certain preconditions, and taking into account the existing warranty
terms, SAF-HOLLAND
provides maintenance free of charge for a period of 72 months or 1 million kilometers for the INTRA ALL-IN axle system.
August 25, 2009 Report on 2009 Half-year results November 19, 2009 Report on 2009 Q3 results
SAF-HOLLAND Group GmbH Barbara Zanzinger Hauptstraße 26 63856 Bessenbach Germany
Tel.: +49 (0)6095 301 617 Fax: +49 (0)6095 301 102
Web: www.safholland.com Email: [email protected]
Responsible: SAF-HOLLAND S.A. 68 –70, Boulevard de la Pétrusse 2320 Luxembourg Luxembourg
| Editorial deadline: | May 27, 2009 |
|---|---|
| Date of publication: | May 28, 2009 |
| Editorial office: | Cortent Kommunikation AG, Frankfurt am Main |
| Design and realization: | wagneralliance Werbung GmbH, Offenbach am Main |
| Translated by: | EnglishBusiness GbR, Hamburg |
This report is also available in German.
This report contains certain statements that are neither reported financial results nor other historical information. This report contains forward-looking statements, which as such are based on certain assumptions and expectations made at the time of publication of the report. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. Many of these risks and uncertainties relate to factors that are beyond the Group's ability to control or estimate precisely, such as future market and economic conditions, the behavior of other market participants, the ability to successfully integrate acquired businesses and achieve anticipated synergies, and the actions of government regulators. Readers are cautioned not to place undue reliance on these forward-looking statements, which apply only as of the date of this presentation. SAF-HOLLAND S.A. does not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of these materials.
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