FORVIA HELLA announces figures for 2023 and outlook for 2024

Currency and portfolio-adjusted sales of €8.1bn in fiscal year 2023

FORVIA HELLA announces figures for 2023 and outlook for 2024

HELLA GmbH Co. KGaA (FORVIA HELLA) has presented the preliminary results for the fiscal year 2023 and the company outlook for 2024.

FORVIA HELLA has increased sales and earnings in 2023 as forecasted, and the company expects further improvements for the current fiscal year.

At the same time, the Company has announced a program to further increase competitiveness in Europe in light of a significantly weakening market environment.

On a preliminary basis, FORVIA HELLA increased its currency and portfolio-adjusted sales by 11.7 percent to €8.1 billion in fiscal year 2023 (1 January to 31 December 2023); taking exchange rate effects into account, reported group sales improved by 10.3 percent to €8.0 billion (calendar year 2022: €7.2 billion.

Operating income increases by around 65 percent to €486 million (calendar year 2022: €295 million, in relation to a low prior-year figure, and the operating income margin thus rises to 6.1 percent (calendar year 2022: 4.1 percent). The net cash flow in relation to sales amounts to 2.6 percent (calendar year 2022: 3.0 percent).

Bernard Schäferbarthold, CEO at FORVIA HELLA, said: “In 2023, we were able to increase our sales and generated over €8 billion for the first time in the company’s history. We also achieved satisfactory financial results thanks to higher business volumes, successful cost control and the pass-through of inflation costs.

“Based on our preliminary business figures, we have therefore achieved all the targets we set for the fiscal year 2023.“

Company outlook for 2024

For fiscal year 2024, FORVIA HELLA expects to generate currency and portfolio-adjusted group sales of between around €8.1 and 8.6 billion. The operating income margin is forecasted to be between around 6.0 and 7.0 percent. For net cash flow in relation to sales, FORVIA HELLA is forecasting a figure of approximately 3 percent.

“For 2024, we are forecasting slight improvements as we expect the market recovery to weaken especially in Europe this year and global car production to remain at a level of around 90 million vehicles for the full year,” said CEO Bernard Schäferbarthold.

“As a Company, we have always been characterized by our ability to adapt at an early stage to changing market conditions. Although we are still strategically well positioned, we are now taking targeted measures to strengthen our competitiveness, particularly in Europe.“

The competitiveness program for Europe was announced against the background of the significant change in market conditions in Europe. On the one hand, car production in Europe in 2025 will fall well short by around 3 to 4 million vehicles of the level forecasted at the beginning of the coronavirus pandemic; vehicle production is only expected to stagnate at a level of around 17 million vehicles per year until 2030.

On the other hand, cost pressure in Europe is increasing significantly due to the resulting overcapacity in the market and changing customer structures.

It is therefore planned to further strengthen FORVIA HELLA’s competitiveness in Europe. In this context, structural measures are to be implemented in the European production network to adapt it to the expected volume reduction; the productivity of the locations is to be increased through consistent investments in standardisation and automation.

Secondly, the intention is to further increase efficiency in research and development as well as in administration, for example through the use of artificial intelligence or relocation or possible bundling of activities; significant improvements, particularly in material costs, should also contribute to secure competitiveness.

The annual gross savings targeted by the measures up to 2028 should then amount to €400 million, of which around €150 million should already be achieved by end of 2025. In total, the company plans to spend around €200 million to implement the overall measures until 2028, of which a large extent will be spent by the end of 2025.

The specific details of the competitiveness program will be determined in the coming months.

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