Schaeffler (SHA0) Q1 2023 earnings summary

Executive summary

• Q1 revenue was €4.152bn, up 10.4% at constant currency, with growth across all divisions and regions.

• Adjusted EBIT rose 30.3% to €336m and margin increased to 8.1% from 6.9%; reported EBIT was €244m after €92m of special items.

Financial highlights

• Revenue increased 10.5% reported to €4.152bn from €3.758bn; gross profit was €984m, or 23.7% of revenue, versus 23.2% YoY.

• Adjusted EBIT rose 30.3% to €336m, with margin at 8.1% versus 6.9%; reported EBIT was €244m versus €247m.

• Special items were €92m versus €11m YoY, mainly energy-related fair-value losses classified in Other.

• Net income attributable to shareholders was €129m, down 5.4% YoY; EPS was €0.19 versus €0.21.

• Free cash flow before M&A cash flows was -€73m versus €14m, reflecting seasonal working-capital expansion and higher capex.

Outlook and guidance

• FY2023 guidance was confirmed: constant-currency revenue growth of 5–8%, adjusted EBIT margin of 5.5–7.5%, and FCF before M&A cash flows of €250–350m.

• Automotive Technologies guidance: moderate constant-currency revenue growth, 2–5 percentage points above global LVP growth, and adjusted EBIT margin of 2–4%.

• Automotive Aftermarket guidance: constant-currency revenue growth of 5–7% and adjusted EBIT margin of 12–14%.

• Industrial guidance: constant-currency revenue growth of 9–11% and adjusted EBIT margin of 11–13%, including structural acquisition effects.

• Wage increases, energy costs, working capital, capex and restructuring costs weigh on margin expectations and inform FCF guidance; Roadmap 2025 priorities include future-oriented investment and profitability improvement.