Continental has announced a 7.6% increase in sales in 2006 to EUR14.9bn, and a 6.3% increase in earnings before interest and tax to EUR1.6bn.
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ROCE for the Continental Corporation was 18.7%, down slightly from 19.4% in 2005. The company attributed this reduction to the integration of Motorola’s automotive electronics business, which was consolidated in the figures from July 2006.
Continental executive board chairman Manfred Wennemer said the figures were particularly pleasing given a EUR317m increase in raw material costs and negative effects from production cut-backs by US car manufacturers.
Sales by the automotive systems division increased 14.6% in 2006 to EUR5.99bn, thanks mainly to the addition of the Motorola business. Motorola’s automotive electronics business contributed EUR528.4m to sales (from July 2006). Before changes in the scope of consolidation and exchange rate effects, sales were up 4.8%. In 2006, automotive systems recorded a decrease in its EBIT of 6.6% to EUR532m.
The passenger and light truck tyres division lifted its sales to EUR4.49bn, up 5.6% compared with 2005. EBIT was down 2.7% to EUR651m.
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By GlobalDataSales of the commercial vehicle tyres division rose to EUR1.47bn, up 6.5%. The division reported an 11% decline in its EBIT to EUR136.2m. The division lifted worldwide truck tyre sales by 4.2% to 6.9m units.
“We have prepared for further growth with additional capacity at low-cost locations in Slovakia, Brazil and Malaysia,” said Hans-Joachim Nikolin, executive board member responsible for the division.
The ContiTech division recorded a decrease in sales to EUR2.87m, down 0.9% compared with 2005, which was attributed to the loss of sales from the Stankiewicz business unit. Formerly part of Phoenix, Continental sold Stankiewicz to a Dutch investment firm in the first quarter of the year.
“All in all, the successful integration of Phoenix AG, which was acquired in 2004, is paying off more and more,” said Gerhard Lerch, executive board member responsible for the division.
“We will integrate our new acquisitions as well, and intensify our ‘internationalisation’ activities in order to continue growing profitably.”
Looking forward, Wennemer said: “Consolidated sales for fiscal 2007 will grow as a result of the full consolidation of the business operations acquired from Motorola. Organic growth of at least 5% is expected as well.”
He added that further acquisitions are likely. In particular Continental Corporation is interested in acquiring Siemens’ automotive components division, Siemens VDO.
