Germany, North America help Brembo increase nine-month profit
While many markets in Europe continue to prove challenging for Italian brake manufacturer Brembo, Germany and the USA have continued to provide the company with enough growth opportunities to keep the company's revenues ahead of those at this stage in 2011. Overall, the company registered net profit up 59.8 per cent in the first three quarters (49 million euros), with sales up 10.5 per cent (1,045 million euros). Chairman Alberto Bombassei said he remained “convinced that the ability to innovate, along with a constant focus on quality, are the foundation of company’s success, even in a crisis scenario."
He stated that Brembo has benefitted from its “gradual establishment in markets outside the European Union, such as the United States”, while Germany continues to provide solidity in Europe, where sales have reduced considerably following the financial crisis. Of these markets, Brembo saw net sales rise by more than 20 per cent in the UK, as well as Germany, though it only achieved around one third of the sales in the former than in the latter.
Brembo’s third quarter figures by sector and territory
In the third quarter of 2012 the Brembo Group’s consolidated revenues amounted to €342.0 million, up 9.5 per cent compared to the same period of the previous year. The car applications sector was most responsible for this, with an increase of 17.6 per cent over the third quarter of 2011. The racing sector also grew by 2.5 per cent. Brembo’s sales declined in the motorbike (-10.3 per cent) and commercial vehicle (-9.1 per cent) sectors.
As with nine-month comparisons, it was Germany (up 26.8 per cent) and North America (up 32.5 per cent) where sales rose most during the third quarter. In the rest of Europe Italy decreased the most (-13.3 per cent), followed by France (-10.7 per cent) and the United Kingdom (-4.1 per cent). In the far east, China grew by 8.4 per cent, Japan declined by 1.1 per cent and India, exacerbated by the effects of the exchange rate, fell by 15.8 per cent (-5.8 per cent net of the exchange rate effect). Brazil was essentially stable with -0.5 per cent at the end of the period, improving compared to -12.9 per cent for the first half of 2012.
The cost of Brembo’s third quarter sales and other net operating costs amounted to €234.6 million, in a ratio of 68.6 per cent to revenues, compared to 70.5 per cent for the same period in the previous year. Personnel costs amounted to €67.2 million, with a ratio of 19.7 per cent, up compared to 18.9 per cent for the third quarter 2011. The workforce at 30 September 2012 was 7,023, with a 288 increase compared to 6,735 at 31 December 2011). EBIT was 19.4 million euros (5.7 per cent of revenues) compared to 15.3 million euros (4.9 per cent of revenues) for the third quarter of 2011. Net profit for the quarter was 13.4 million euros compared to 5.9 million for the same period of the previous year.
Looking forward, Brembo confirmed its guidance figures from the beginning of 2012, which indicated revenue growth in the range of 9-10 per cent with percentage margins in line with 2011. The company said that Germany, North America and China remain promising in terms of growth in sales, while the rest of Europe continues to suffer from the difficulties affecting the car market.
Boards of Directors and Auditors impose gender reservations
In addition to its results, Brembo’s Board of Directors approved an amendment to its bylaws to ensure compliance with regulatory provisions imposing gender-based reservations of seats on the governing and control bodies of listed companies. The next time a new Board of Directors and Board of Auditors are to be appointed, at Brembo’s General Meeting of Shareholders to approve 2013’s financial statements, one fifth of the seats will be reserved for persons belonging to the gender with minority representation. This quota shall be raised to one third of the said seats, at the two subsequent rounds of appointments.