- Sales grow to 2.5 billion euros in 2013
- Sales increase by 5 percent in the first quarter of 2014
- Company sells more than 10 million sliding and panorama roofs for the first time
- Further growth with new technologies, a global footprint, and a worldwide organizational network
The automotive supplier Webasto remained on a growth path. In the 2013 fiscal year, sales grew by two percent to 2.5 billion euros (2012: 2.4 billion euros). Adjusted for exchange-rate effects, the company achieved 4 percent growth. The sales volume was distributed between three core business segments: Sunroofs & Components (sliding and panorama roofs) accounted for 69 percent of total sales, Thermo & Comfort (heating and air-conditioning systems) for 20 percent, and Convertibles (convertible roofs) for 11 percent. In 2013, Webasto’s largest worldwide division sold more than 10 million sliding and panorama roofs for the first time.
In the last few years, the Webasto Group has steadily become more international. Of the 10,517 employees in the group (as of December 31, 2013), nearly 70 percent work at international sites. Today, more than 75 percent of the group’s sales is achieved outside of Germany. In this respect, the company is well above the industry average. By comparison, according to an industry report of Commerzbank (3/2014), automotive suppliers generate around a third of their sales abroad.
In the last fiscal year, the earnings of the Webasto Group amounted to 126 million euros (2012: 125 million euros), equivalent to an EBIT margin of 5.1 percent. Earnings of just under a three-digit amount were expected for 2013. “In view of economic developments, I am satisfied with our earnings,” said Dr. Holger Engelmann, Chairman of the Management Board of Webasto SE, during the annual press conference in Munich. “We owe the earnings above all to our sunroofs business in Asia.” By implementing austerity measures, the Thermo division was almost able to offset its weak business in southern Europe and its modest parking heater business due to weather. In the still-stagnating convertible roof business, the focus was on efficiency enhancements in development and manufacturing. For these improvements, also investments were needed: In the new convertible roof development center in Hengersberg – the world’s most advanced – and the merge of different plants in Slovakia and in the United States. “Our goal as the market leader in convertible roofs is to be profitable even with smaller unit numbers,” explains Engelmann.
In 2013, Webasto invested a total of 155 million euros (136 million euros in 2012), which corresponds to aninvestment ratio of 6.2 percent. At 45 million euros, the capital invested to expand capacities for the manufacture of polycarbonate roofs and panels was by far the largest single investment in new technologies. At the plant in Schierling near Regensburg, around 45,000 polycarbonate parts are now produced each month.
Research and development expenditure was also at a high level, at 7.7 percent (7.2 percent in 2012). “Only suppliers that continually develop innovative products and at the same time have a networked organization globally can survive in the long term as a system partner for globally manufacturing automotive manufacturers,” Engelmann added. “To be able to provide the necessary investments and research expenditure in the long run, we have to generate appropriate margins.”
Engelmann also draws a positive balance for the first quarter of 2014. With the first-time inclusion of the new accounting standard IFRS 11* and the results of the first quarter of 2013 adjusted to it, group sales rose by 5 percent. Earnings in the first quarter of 2014 were 36 million euros (20 million euros in the first quarter of the previous year), corresponding to an EBIT margin of 6.3 percent. The development in the first quarter is due mainly to the growth in the division for sunroofs and panorama roofs in China. For 2014 as a whole, Engelmann expects sales growth of 4 percent for the Webasto Group. Order backlog currently amount to 8.8 billion euros.
Growth with new technologies
At the center of Webasto’s corporate policy is a sustainable increase in the company’s value. In the next few years, the focus will primarily be on the following topics:
- Multi Optional Roof: With this growth strategy for roof systems, Webasto is planning to move from being a special equipment provider to a series provider. Different roof variants can be put on one car body variant. As a result, solutions geared to specific models – a component of individualized vehicles – can be implemented cost-effectively.
- Introduction of innovative products to reduce CO2 emissions: The spectrum ranges from the most efficient Eco Innovation to date, the battery-charging solar roof, to further expansion of business with lightweight materials such as polycarbonate and paper honey comb (PHC), to the electric high-voltage heater for hybrid and electric cars.
- Expansion of the company’s position as a system supplier for heating and cooling from one source for light commercial and special vehicles. Thus, growth outside of Europe is being pushed forward.
Growth with a global footprint and a networked organization
All medium-term forecasts anticipate further growth in China. In the light of its existing development projects, Webasto will continue to grow in China too. For 2018, the company expects sales of more than 1 billion euros in the Middle Kingdom. But equal focus has to be placed on growth and costs.
One of the most important success factors for the automotive supplier industry will be having a global networked organization. More and more Webasto customer projects, particularly in the roof segment, are global projects. This year alone, there were more than 50 start of productions worldwide. They can only be launched successfully if the company has a global development and manufacturing network as well as corresponding processes and standards.
“To implement a start of production for our customers almost every week, without a sound and in top quality, we need an organization that thinks and acts globally,” says Engelmann, outlining the challenge. “That’s why our experts at the different locations are cooperating closely in a network. That is an important competitive advantage. Ultimately, you can copy a product, but not a well-functioning organization,” says Dr. Holger Engelmann, summing up.
*New consolildation rules in accordance with IFRS 11
Following the changes made to IFRS 11 (International Financial Reporting Standards), as of 2014 non-controlled 50-50 joint ventures (JV), i.e. joint companies in which Webasto has no industrial leadership, will no longer be included at 50 percent in the consolidated financial statements. As a result, the Webasto Donghee (Korea) JV will be consolidated for the first time based on this equity method. This results in changes in sales, total assets, equity ratio, and number of employees.
