Solid First Quarter in Weak Market Environment

Con­ti­nen­tal has man­aged a sol­id start to the new busi­ness year. Thanks to its tech­nol­o­gy port­fo­lio, the com­pa­ny has been able to dis­tance itself from the sub­stan­tial down­ward trend on the mar­ket. At €11.0 bil­lion, sales were on par with the pri­or year lev­el. The adjust­ed EBIT mar­gin was 8.1 per­cent (adjust­ed EBIT: €884 million).

At the DAX company’s Annu­al Share­hold­ers’ Meet­ing in Hanover on Fri­day, Continental’s CEO Dr. Elmar Degen­hart was sat­is­fied with the results for the quar­ter: “Glob­al car pro­duc­tion was down sub­stan­tial­ly at the begin­ning of the year, as expect­ed. That is why our sol­id results are all the more grat­i­fy­ing, thanks to our strong mar­ket posi­tion on the mobil­i­ty mar­kets world­wide. Our increased cost dis­ci­pline also con­tributed to this achievement.”

In the first three months of 2019, glob­al auto­mo­bile pro­duc­tion was down by more than 6 per­cent year-on-year, accord­ing to pre­lim­i­nary fig­ures. In con­trast, the tech­nol­o­gy company’s organ­ic growth (before changes in the scope of con­sol­i­da­tion and exchange-rate effects) was down by only 2 percent.

Con­ti­nen­tal con­tin­ues to expect a mar­ket upturn in the sec­ond half of the year and is thus main­tains its annu­al guid­ance issued at the begin­ning of January.

In the cur­rent fis­cal year, Con­ti­nen­tal is lay­ing fur­ther impor­tant ground­work for its orga­ni­za­tion­al realign­ment announced last July. A cru­cial part of this is the trans­for­ma­tion of its pow­er­train busi­ness into an inde­pen­dent group of legal enti­ties, which Con­ti­nen­tal com­plet­ed on sched­ule on Jan­u­ary 1, 2019.

Since then, Con­ti­nen­tal has con­tin­ued prepar­ing for the pos­si­ble par­tial IPO of its pow­er­train busi­ness, which in the future will be called Vitesco Tech­nolo­gies. It is expect­ed that the nec­es­sary con­di­tions will be ful­filled toward the end of the sec­ond half of the year so that addi­tion­al details can be pro­vid­ed to the cap­i­tal mar­kets. Once fur­ther tech­ni­cal and reg­u­la­to­ry require­ments have been com­plet­ed, the com­pa­ny will be in a posi­tion to final­ize the par­tial IPO. Depend­ing on the mar­ket sit­u­a­tion, this is expect­ed from 2020.