Preliminary figures and company outlook reveal HELLA expects record sales and further improved profitability for 2023

Date: Monday 20 February 2023

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HELLA, the automotive supplier operating under the FORVIA umbrella brand, has announced its preliminary results for the short fiscal year 2022 (1 June to 31 December 2022) and the outlook for the fiscal year 2023.

HELLA generated sales of € 4.4 billion in the short fiscal year 2022. The adjusted earnings before interest and taxes (adjusted EBIT) amount to € 222 million, the adjusted EBIT margin is 5.0 percent (fiscal year 2021/2022: 4.4 percent). Adjusted free cash flow from operating activities amounts to € 83 million. HELLA reports results for a short fiscal year after the fiscal year was changed to the calendar year with effect as of 1 January 2023.

"In the short fiscal year 2022, we delivered a solid business performance and again won numerous high-technology, large-volume customer projects with an order intake of around € 7 billion," said HELLA CEO Michel Favre. "As expected, profitability, and cash flow have also improved. We were able to successfully mitigate the continued high-costs for materials, energy and logistics by passing on price increases, as well as manage our cost base efficiently."

Successful business development in all Business Groups due to high demand for core products
In the short fiscal year 2022, sales in the Lighting Business Group amount to € 2.1 billion. Especially in the Chinese market, the lighting business has developed successfully, also due to series launches, which have now continued to ramp up. EBIT amount to € 44 million, the EBIT margin improves to 2.1 percent (fiscal year 2021/2022: 0.4 percent).

In the Electronics Business Group, sales amount to € 1.9 billion. Main contributors were the business with energy management, body electronics, sensors, and actuators. EBIT amounted to € 124 million, and the EBIT margin has increased to 6.5 percent (fiscal year 2021/2022: 5.5 percent).

The Lifecycle Solutions Business Group generated sales of € 0.6 billion. The spare parts business was successful in key regions; the commercial vehicle business recorded high demand from manufacturers of agricultural machinery, trucks and trailers. EBIT amounted to € 58 million, the EBIT margin was 10.1 percent (fiscal year 2021/2022: 12.4 percent).

Expected cost synergies from cooperation with Faurecia increase to more than € 300 million at the end of 2025
In the short fiscal year 2022, the cooperation with Faurecia under the umbrella brand FORVIA has progressed further. Both companies have recorded significant successes in the realization and identification of cost synergies. The total cost synergies for FORVIA are expected to reach over € 300 million at the end of 2025. HELLA will account for about the half of it.

Company outlook forecasts record sales in the range of around € 8.0 to 8.5 billion in the fiscal year 2023
For the fiscal year 2023 (1 January to 31 December 2023), HELLA expects to generate currency and portfolio-adjusted sales in the region of € 8.0 to 8.5 billion. The operating income margin* is forecasted to be in the range of 5.5 to 7.0 percent. For net cash flow in relation to sales HELLA expects a target value of approximately 2 percent. This outlook is based on HELLA's expectation that global automotive production will be around 82 million vehicles.

"We expect the market environment to continue to be volatile. However, thanks to our solid order book, we remain optimistic about the future. Therefore, we expect to achieve record sales in 2023 and to exceed € 8 billion in sales for the first time. This shows our strong outperformance of the market in our key regions, and we expect to deliver a solid improvement of our operating income and net cash flow," Favre continued. "In terms of the forecasted operating income margin and net cash flow in relation to sales, we expect an initially lower value in the first half of the fiscal year. However, we will increase these KPIs in the further course of the fiscal year."

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