HWA AG half year report 2009

Transcription

1 HALF YEAR REPORT

2 Contents Highlights and key figures Page 3 Interim management report Page 4 Sales and earnings Page 4 Finances Page 4 Assets and liabilities Page 5 Business Units Page 5 Automobile racing Page 5 Vehicles and vehicle components Page 6 Employees Page 6 Annual General Meeting 2009 Page 6 HWA AG stock Page 6 Investor relations / press Page 7 HWA AG financial statements for the half year to 30 June 2009 Page 8 Balance sheet assets Page 8 Balance sheet liabilities Page 9 Income statement Page 10 Cash flow statement Page 11 Statement of changes in equity Page 12 2

3 Highlights and key figures Highlights first half year 2009 First half revenues of EUR 40.6 million Revenues up by 34.2% EBIT just under breakeven Cash flow from operating activities positive First half year s performance largely in line with expectations Double victory at Eurospeedway and Norisring in German Touring Car Masters Championship (DTM) Delivery of new model on schedule Key balance sheet figures (HGB) EUR EUR 000 Cash and cash equivalents Equity 21,934 24,297 Total assets 41,164 44,855 Equity ratio 53% 54% Key earnings figures (HGB) EUR EUR 000 Revenues 40,607 30,249 EBIT ,051 Net profit for the period ,428 Earnings per share Employees This half year report was has been prepared in accordance with the German Commercial Code (HGB). The report has not been audited by a registered auditor or subjected to external audit review. 3

4 INTERIM MANAGEMENT REPORT Dear shareholders, Business during the first six months of 2009 was marked by the worldwide recession. The economic crisis has impacted nearly every national economy in the world with unprecedented speed and severity. Despite these exceptional conditions, HWA AG has performed in line with Management s expectations. Unlike in the same period last year, we recorded significant revenues from the production of road vehicles in the vehicles and vehicles components business. Delivery of the new model is proceeding according to plan, and will be completed in the second half of In contrast, the demand for Formula 3 engines has fallen. Cutbacks in the budget for Daimler AG s motor sports activities in the German Touring Car Masters (DTM) led as expected to a decrease in revenues for the motor racing business in the first half of The financial and economic crisis has had a severe impact on the automotive industry. In response to budget cuts in the DTM, the regulatory freeze on development of new racing cars for the series in 2010, and excess capacity in the vehicles and vehicles components business, HWA AG will reduce capacities and restructure its operations. To return the Company to profit as quickly as possible, reductions in personnel are unavoidable. The costs for restructuring and reductions in capacity are largely already included in the figures for the first half of Adjusted for these one-time effects, the Management Board expects EBIT for 2009 as a whole to be at breakeven or positive. SALES AND EARNINGS HWA AG s sales revenues in the first half of 2009 came to EUR 40.6m, an increase of 34.2% compared with the first half of last year. The growth in revenues was mainly driven by the delivery of a new model by the vehicles and components business. EBIT was a negative EUR 0.15m, after a positive EUR 2.0m for the same period last year. The reasons for the lower profitability in the first half of 2009 were significantly higher costs for raw materials in connection with the new model in the vehicles and components business, as well as lower contributions from Formula 3 engines and the motor racing business. Operating results also included the one-time expenses for restructuring. Net financial expenses were down slightly, from EUR 140,000 to EUR 128,000. The loss before tax was EUR 278,000, after a profit before tax of EUR 1.9m in the first six months of Tax expense dropped from EUR 483,000 to EUR 251,000. After taxes on income, the net loss for the period was EUR 0.53m, compared with a net profit of EUR 1.4m for the same period last year. Earnings per share were a negative EUR 0.10 compared with a positive EUR 0.28 in first half FINANCES Compared with the position at 30 June 2008, total assets were slightly down from EUR 44.86m to EUR 41.16m. The equity ratio was down by 1 percentage point, and stood at 53.3% at 30 June 2009, which is still a comfortable level. Cash flow from operating activities was EUR 113,000, after a net cash outflow of EUR 3.05m for the same period last year. Trade receivables fell slightly during the first six months of Inventories sank significantly. The aim is to further optimise working capital by the end of the full year. Cash outflow from investment activities was down significantly, from EUR 5.23m to EUR 372,000. HWA AG continues to predict low expenditure on investments, which in turn will reduce the pressure on liquidity. For the first six months of 2009 there was a slight free 4

5 cash outflow of EUR 259,000. For the same period last year, the free cash outflow was EUR 8.28m. The cash outflow from financing activities dropped from EUR 5.31m to EUR 1.7m, principally because no dividend was paid for 2008 and the retained earnings were carried forward into the new year. ASSETS AND LIABILITIES At 30 June 2009 trade receivables amounted to EUR 5.7m, compared with EUR 6.9m a year earlier, while trade payables were up from EUR 3.6m to EUR 4.9m. At the end of the half year, cash and cash equivalents, consisting of cash in hand and securities, amounted to EUR 131,000. Liabilities to banks totalled EUR 10.2m. BUSINESS UNITS HWA AG is organised as two Business Units. In the motor racing business, HWA AG acts as a full service provider to Daimler AG Motorsport in the DTM. It is responsible for the whole process of development and construction of the racing cars, including the engines, together with all other activities involved in the racing team s operations. In its vehicles and components business, it develops and builds road cars and vehicle components for the automobile industry. In addition since 2003 HWA AG has been producing and servicing racing engines for the Formula 3 Euroseries and the British Formula 3 Series. AUTOMOBILE RACING The automobile racing business was affected by cutbacks in the budget for Daimler AG s motor sports activities in the German Touring Car Masters (DTM). The number of races was reduced from 11 to 10, and the racing days were cut from three to two. On the one hand, this meant less expense for HWA AG, but on the other hand contributions from automobile racing also fell, due to lower sales. Last year as well as in the first half of 2009 there was substantial investment in the continuing development of racing cars, capacities and test series. Management regards these investments as essential to ensure the continued success of the AMG Mercedes team in the medium term. The increased expenditure has already paid off: after a difficult first race of the season in Hockenheim, the next three races were wins. At Eurospeedway Lausitz the AMG-Mercedes team claimed a double victory. Gary Paffett as the victor, and Bruno Spengler came in second. After an extremely exciting race, there was another double victory at Norisring. Jamie Green came in first, and Bruno Spengler was in second place again. On the Dutch racetrack in Zandvoort Gary Paffett celebrated another victory. Four more races are scheduled for 2009: Brands Hatch, UK, (6 September); Barcelona, Spain (20 September); Dijon, France (11 October) and Hockenheim, Germany (25 October). Both Gary Paffett and Bruno Spengler have excellent chances of winning the DTM drivers championship title. HWA AG s goal is to win the championship. The chances of winning the team championship again after 2008 are also still good. Without the investments we made in motor sport, our team would not have stood a chance against our competitor in the DTM the improvements made in 2008 have paid off. VEHICLES AND VEHICLE COMPONENTS HWA AG s vehicles and components business supplies development and production services to the automobile industry internationally. The first half of 2009 was marked by the delivery of a new model. The delivery is proceeding according to plan and will be completed during the second half of the year. Management is currently exploring the possibility of new projects for a further model. 5

6 Demand for Formula 3 engines, which are also form part of this business, declined as a result of the economic crisis. Formula 3 racing saw a reduced flow of sponsorship money compared with the previous year, which had a correspondingly adverse effect on the demand for engines. Despite the roughly 25% drop in the number of engines being leased out, HWA is still market leader in the field, and very successful. In this year s first Formula 3 race in Zandvoort, Jules Biannchi notched up the 100th victory with a HWA engine in this high-class junior race series. Biannchi s team mate Valtteri Bottas made it a double victory for the ART Team, where reigning Formula 1 World Champion Lewis Hamilton earned his spurs in EMPLOYEES At 30 June 2009 HWA AG had 261 employees and 21 temporary employees. ANNUAL GENERAL MEETING 2009 In detail, the resolutions passed concerned the carrying forward of distributable profits (item 2), discharge from liability of the Management Board (item 3) and the Supervisory Board (item 4), authorisation to acquire own shares (item 5) and appointment of registered auditor Joachim Lutz as statutory auditor for financial 2009 (item 6). HWA STOCK HWA AG stock performed poorly during the first six months of At the beginning of January, the stock opened at EUR 15.00, and closed at the end of June at EUR At 30 June 2009, market capitalisation was EUR 47m, compared with EUR 76.7m at the beginning of the year, a loss in market value of around 38.5%. This meant that HWA AG shares under-performed the stock market indexes in Germany. The high during the period was EUR and the low EUR After the end of the period under review, HWA AG stock regained ground as the capital markets staged a significant recovery. At the time this report was compiled in August 2009, the share price had recovered to between EUR and EUR The second Annual General Meeting since the initial stock market listing in 2007 took place on 8 May Around 60 shareholders met in the equestrian facility in Rotland in Affalterbach. Share capital with a nominal value of EUR 4,328,320 was represented at the Meeting, i.e., 84.62% of the Company s total share capital of EUR 5,115,000. We are very pleased with the great interest in the Company shown by shareholders, especially by the smaller ones. With the exception of agenda items 2 and 3, the resolutions were passed with few dissenting votes. There were a good 150,000 votes against the two resolutions proposing the discharge from liability of members of the Management and Supervisory Boards. 6

7 KEY FIGURES AND INFORMATION Security identification number (WKN) ISIN Stock exchange symbol Trading segment Share type A0LR4P DE000A0LR4P1 H9W Entry Standard (part of Open Market) on Frankfurt Stock Exchange Ordinary no par value bearer shares Authorised capital EUR 5,115, Shares in issue 5,115 million Initial listing 19 April 2007 Listing price EUR Designated sponsors Close Brothers Seydler Bank AG ICF Kursmakler SHAREHOLDER INTERESTS AS AT 30 JUNE 2009 INVESTOR RELATIONS / PRESS Communicating with institutional and private investors is important to HWA AG, even in difficult times. With our investor relations work we practise continuous and open information exchange with all participants in the capital markets. Since last year HWA s coverage is being provided by Close Brothers Seydler Research AG. Due to the media s increased interest in Arab investors in Germany, as a result of an investor from Qatar investing in Porsche and Volkswagen, HWA AG has featured more prominently than usual in magazines, newspapers and television. For example, the German television station ARD reported on our Company in their show Plusminus, as did manager magazin. NBK Holding, an investor from Qatar, has been a shareholder for 2 years now. The Company s founder Hans Werner Aufrecht, MarchSixteen Finance Services, represented by Christian Wolff, Willibald Dörflinger through the Dörflinger Privatstiftung and Nasser Bin Khaled (NBK) Holding (all represented on the Supervisory Board) together with the Management Board hold about 90% of HWA AG s share capital. NBK from Qatar has a share of nearly 28% and, next to Hans Werner Aufrecht, is the Company s largest shareholder. 7

8 HWA AG financial statements for the half year to 30 June 2009 Balance sheet assets (HGB) ASSETS A. Non-current assets EUR EUR 000 I. Intangible assets IT software and licences 825, II. Property, plant and equipment 1. Property and buildings 17,442,590 17, Plant and machinery 1,545,481 1, Other assets, plant and office equipment 3,705,735 3, Payments in advance and assets under construction 247, III. Financial assets 22,941,021 23,383 Other loans ,766,100 24,528 B. Current assets I. Inventories 1. Raw materials and supplies 7,942,612 5, Work in progress 1,287,748 5, Payments in advance 40,375 0 II. Receivables and other assets 9,270,735 10, Trade receivables 5,700,365 6, Receivables from associated companies 51, Other current assets 1,445,449 1,335 III. Securities 7,197,776 8,304 Other securities 105, IV. Cash in hand and at banks 26, ,600,459 19,505 C. Prepaid expenses 442, D. Deferred tax assets 355, ,163,788 44,855 8

9 HWA AG financial statements for the half year to 30 June 2009 Balance sheet equity and liabilities (HGB) Equity and liabilities EUR EUR 000 A. Equity I. Share capital 5,115,000 5,115 II. Revenue reserves 1. Statutory reserve 489, Other revenue reserves 500, ,011 1,011 III. Retained earnings 15,829,995 18,171 Total equity 21,934,006 24,297 B. Provisions 1. Provisions for taxation 558, Other provisions 2,932,611 5,472 3,491,210 6,350 C. Liabilities 1. Amounts due to banks 10,165,409 8, Payments in advance received for orders 300, Trade payables 4,907,661 3, Other liabilities 365, thereof taxes EUR 346, (HY1 2008: EUR 325,000) thereof social security EUR 0.00 (HY1 2008: EUR 1,000) 15,738,572 12,493 D. Accrued liabilities 0 1,715 41,163,788 44,855 9

10 HWA AG financial statements for the half year to 30 June 2009 Income statement for the half year to 30 June 2009 (HGB) EUR EUR Revenues 40,607,220 30, Changes in inventories of finished goods and work in progress 638,231 4, Other operating income 469, Total output 41,714,834 35, Raw materials a) Expenses for raw materials and consumables used 17,960,933 11,108 b) Expenses for external services 8,426,191 7, Staff costs a) Wages and salaries 7,322,868 7,476 b) Social security and pension contributions 1,210,507 1,025 thereof pension contributions EUR 9, (HY1 2008: EUR 9,000) 6. Depreciation and amortisation of tangible and intangible assets 1,420,332 1, Other operating expenses 5,523,992 5,168 41,864,824 33, Other interest and similar income 868, Interest and similar expenses 996, , Profit / (loss) from ordinary activities -278,406 1, Income tax expense 193, thereof income from change in deferred tax assets EUR 355, (HY1 2008: EUR 0) 12. Other taxes 57, , Net profit / (loss) for the period -529,535 1, Profits brought forward from previous year 16,359,530 16, Allocation to statutory reserve Retained earnings 15,829,995 18,171 Earnings per share EUR EUR

11 HWA AG financial statements for the half year to 30 June 2009 Cash flow statement for the half year to 30 June 2009 (HGB) EUR 000 EUR Cash flow from operating activities Net profit / (loss) for the period ,428 Depreciation and amortisation of non-current assets 1,420 1,385 Increase in provisions 942 1,222 Other non-cash expenses Cash flow per DVFA/SG 2,268 4,106 Gains on disposal of non-current assets 0-22 (Increases) / decreases in inventories, trade and other receivables 1,976-8,842 Increases / (decreases) in trade and other payables -4,131 1,709 Cash flow from operating activities 113-3, Cash flow from investment activities Proceeds of disposal of non-current assets 0 29 Investments in non-current assets ,263 Cash flow from investment activities , Cash flow from financing activities Distributions to shareholders 0-3,836 Proceeds from bank borrowings Repayment of bank borrowings -2,316-1,477 Cash flow from financing activities -1,716-5,313 Net change in cash and cash equivalents -1,975-13,596 Cash and cash equivalents at beginning of period -2,798 11,325 Cash and cash equivalents at end of period -4,773-2,271 11

12 HWA AG financial statements for the half-year to 30 June 2009 Statement of changes in equity as at 30 June 2009 Share capital Statutory reserve Revenue reserves Net profit for period Total EUR 000 EUR 000 EUR 000 EUR 000 EUR 000 Balances 1 January , ,359 22,463 Net loss for the period Balances 30 June , ,830 21,934 12

13 Publication details Publisher HWA AG Benzstrasse 8 D Affalterbach Germany Investor relations HWA AG Benzstrasse 8 D Affalterbach Germany Contacts Tel: Fax: ir@hwaag.com 13