Thanks to a restructuring program, which consisted of both a comprehensive cost-saving program and a reduction in net working capital, SAF-HOLLAND’S gross margin improved to 16.3%, compared to 14.8% in the previous year.
SAF-HOLLAND saw significantly higher demand at the beginning of the new fiscal year 2010 than was the case in the previous fiscal year. As a result of reduced global demand, SAF-HOLLAND recorded Group sales of $566 million in the reporting year (previous year: $1.07 billion). Thanks to a promptly implemented cost-reduction program, the Group generated positive adjusted earnings before interest and taxes (EBIT) in the amount of $2.02 million (previous year: $55.5 million).
Rudi Ludwig, CEO of SAF-HOLLAND Group S.A.: "In the crisis, we made our company leaner and stronger while remaining true to our quality standards. This will be rewarded by our customers in an improving market. The first quarter has brought us initial positive signals. The objective now is to gain from the positive market development”.
The Trailer Systems Business Unit was particularly hard hit by the market collapse that followed the economic crisis because demand from trailer manufacturers, especially in Europe, decreased dramatically. Sales in the segment amounted to $236 million (previous year: $712 million), adjusted for exchange rate effects the figure was $232 million. The underutilization of capacities that resulted from sales development contributed to a decline in the gross margin to -1.7% (previous year: 9.5%). The Business Unit successfully launched production of its own axle systems in the USA, thereby establishing a firm basis for future growth in North America.
The Powered Vehicle Systems Business Unit benefited from the acquisition of the current SAF-HOLLAND Verkehrstechnik GmbH. The division generated nearly constant sales of $132 million (previous year: $137 million).
Earlier than originally planned, SAF-HOLLAND will halt reduced working hours at its locations in Germany in April. Core employees will return to full-time work. The plant in Keilberg, which had been shut down, will begin operations again this month.
In the medium-term, SAF-HOLLAND’s goal is still to generate sales this year of $1.34 billion while achieving an adjusted EBIT margin of 10%.