Norma Group’s sales rise

The com­pa­ny achieved sales of over EUR 1 bil­lion for the first time in fis­cal year 2017. Group sales rose by 13.7 per­cent to EUR 1,017.1 mil­lion com­pared to the pre­vi­ous year (2016: EUR 894.9 mil­lion). Organ­ic growth was strong at 8.6 per­cent. The acqui­si­tions of Auto­line, Lifi­al und Feng­fan con­tributed an addi­tion­al EUR 57 mil­lion to sales. Neg­a­tive cur­ren­cy effects reduced sales growth by 1.4 per­cent. Adjust­ed earn­ings before inter­est, tax­es, depre­ci­a­tion and amor­ti­za­tion of intan­gi­ble assets (adjust­ed EBITA) rose by 10.8 per­cent to EUR 174.5 mil­lion in 2017 com­pared to the pre­vi­ous year (2016: EUR 157.5 mil­lion). The adjust­ed EBITA mar­gin declined slight­ly main­ly due to high­er com­mod­i­ty prices. At 17.2 per­cent, the adjust­ed EBITA mar­gin was in line with the fore­cast of over 17 per­cent (2016: 17.6 per­cent). Net oper­at­ing cash flow declined by 10.5 per­cent to EUR 132.9 mil­lion (2016: EUR 148.5 mil­lion). Adjust­ed earn­ings per share rose to EUR 3.29 (2016: EUR 2.96). Tax cuts in the US led to one-time non-cash deferred tax income of EUR 33.9 mil­lion. This one-time effect was not includ­ed in the adjust­ed result for the peri­od and there­fore not shown in adjust­ed earn­ings per share. The unad­just­ed prof­it for the peri­od amount­ed to EUR 119.8 mil­lion and is 57.9 per­cent above the pre­vi­ous year’s lev­el (2016: EUR 75.9 mil­lion), in par­tic­u­lar due to the afore­men­tioned one-time tax effects. As a result, the unad­just­ed earn­ings per share for the year 2017 amount­ed to EUR 3.76 (2016: EUR 2.38).
“Nor­ma Group expe­ri­enced strong growth in all regions in 2017 and sur­passed the EUR 1 bil­lion mark in annu­al sales for the first time ever,” said Bernd Klein­hens, Chair­man of the Man­age­ment Board of the com­pa­ny. “We will seek to con­tin­ue on our growth path in the future as well by fur­ther diver­si­fy­ing and local­iz­ing our busi­ness and tap­ping into the poten­tial that impor­tant future mar­kets such as elec­tro­mo­bil­i­ty and water man­age­ment offers,” he added.

Growth in all three regions

In the EMEA region (Europe, Mid­dle East and Africa), the com­pa­ny increased its sales by 12.5 per­cent in 2017 to EUR 485.9 mil­lion com­pared to the pre­vi­ous year (2016: EUR 432.0 mil­lion). This can be attrib­uted to strong demand for join­ing tech­nol­o­gy in the Euro­pean auto­mo­bile indus­try and the acqui­si­tions of the Auto­line busi­ness in France and Lifi­al in Portugal.
The Amer­i­c­as region record­ed sales growth of 7.8 per­cent to EUR 411.3 mil­lion com­pared to the year before (2016: EUR 381.6 mil­lion). The US com­mer­cial vehi­cle and agri­cul­tur­al machin­ery mar­kets recov­ered strong­ly, the auto­mo­tive sec­tor devel­oped well and the Mex­i­can Auto­line busi­ness that the com­pa­ny acquired in Novem­ber 2016 con­tributed to growth as well.
In the Asia-Pacif­ic region,the com­pa­ny increased its sales to EUR 119.9 mil­lion in 2017, an increase of 47.6 per­cent com­pared to the pre­vi­ous year (2016: EUR 81.3 mil­lion). Stricter emis­sion stan­dards led to high demand for join­ing tech­nol­o­gy from the Asian vehi­cle indus­try. The acqui­si­tions of Feng­fan and the Chi­nese Auto­line busi­ness also had a pos­i­tive effect on sales growth.

Increase of the dividend to EUR 1.05 per share proposed

The Man­age­ment Board and Super­vi­so­ry Board of Nor­ma Group SE will pro­pose a div­i­dend of EUR 1.05 per share for fis­cal year 2017 at the Annu­al Gen­er­al Meet­ing on May 17, 2018. This equates to an increase of 10.5 per­cent or EUR 0.10 and a dis­tri­b­u­tion amount of around EUR 33.5 mil­lion. The pay­out ratio would thus be 31.9 per­cent of adjust­ed Group earn­ings in fis­cal year 2017 of EUR 105.0 million.

Increased equity ratio

Group equi­ty amount­ed to EUR 534.3 mil­lion as of Decem­ber 31, 2017. This cor­re­sponds to an increase of 10.5 per­cent com­pared to the end of the pre­vi­ous year (Decem­ber 31, 2016: EUR 483.6 mil­lion). Despite the div­i­dend pay­ment of EUR 30.3 mil­lion and neg­a­tive cur­ren­cy trans­la­tion dif­fer­ences of EUR 35.8 mil­lion, the equi­ty ratio improved to 40.7 per­cent at the end of 2017 (Decem­ber 31, 2016: 36.2 per­cent). Net debt includ­ing hedg­ing instru­ments decreased by 12.5 per­cent to EUR 344.9 mil­lion as of Decem­ber 31, 2017 (Decem­ber 31, 2016: EUR 394.2 million).

Solid organic growth

The firm expects the glob­al econ­o­my to con­tin­ue to pick up again in 2018, dri­ven by growth, par­tic­u­lar­ly in Chi­na, the US and emerg­ing markets.
 
Over­all, the Man­age­ment Board expects sol­id organ­ic Group sales growth of around 3 to 5 per­cent for 2018. In addi­tion, rev­enues from the acqui­si­tion of Feng­fan in the amount of around EUR 5 mil­lion are expect­ed. The Man­age­ment Board expects as strong as usu­al net oper­at­ing cash flow of approx. EUR 140 mil­lion in 2018. For 2018, a sus­tain­able adjust­ed EBITA mar­gin of more than 17 per­cent (pre­vi­ous year: 17.2 per­cent, 2016: 17.6 per­cent, 2015: 17.6 per­cent) will again be the tar­get. In par­tic­u­lar, due to the tax cuts in the US, the Man­age­ment Board expects a sig­nif­i­cant­ly improved tax rate of between 26 and 28 per­cent for fis­cal year 2018 and a strong increase in adjust­ed earn­ings per share.

Separate Corporate Responsibility Report

The firm has com­plied with the require­ments of the CSR Direc­tive Imple­men­ta­tion Act for more trans­paren­cy on the envi­ron­men­tal and social respon­si­bil­i­ty of com­pa­nies for report­ing on fis­cal year 2017. For this pur­pose, a sep­a­rate Cor­po­rate Respon­si­bil­i­ty Report (CR Report) was pub­lished at the same time as the Annu­al Report on March 21, 2018. Among the sus­tain­abil­i­ty indi­ca­tors it men­tions are employ­ee and envi­ron­men­tal indi­ca­tors as well as key fig­ures on human rights and sup­ply chain sus­tain­abil­i­ty. More infor­ma­tion can be found in the 2017 CR Report.