Successful integration at ZF

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GERMANY ZF Friedrichshafen AG says that it continued its successful corporate development in 2015. Group sales of €29.2bn were generated including €8.9bn from ZF TRW, which has been integrated as the new “Active & Passive Safety Technology” Division since its acquisition in May, 2015. Currency effects and organic growth together accounted for 5% of the increase in sales. Earnings before interest and taxes (EBIT) totalled €1.6bn, which corresponds to growth of €498m and an EBIT margin of 5.5%. The key figures have been significantly influenced by acquisitions and disposals and, as such, are only comparable with the prior-year figures to a limited extent says ZF.

“2015 was an outstanding year for our company,” says Dr. Stefan Sommer, ZF Chief Executive Officer. “We celebrated our centennial and successfully completed the largest and most important acquisition in the company’s history. I am proud to say that, in the past financial year, we laid the foundations for a sustainably successful future at ZF. We are networking mechanical components intelligently with control units and sensors. This way, we will be able to help shape the megatrends of safety, efficiency and autonomous driving even more effectively.”

The Chairman of the ZF Supervisory Board, Prof. Dr. Giorgio Behr, expressed his great satisfaction with the performance of the Executive Board and the Chief Executive Officer. “We are very proud to have such a visionary and innovative Chief Executive Officer in Stefan Sommer,” said Giorgio. “The acquisition of TRW is a particular case in point where he moved ZF and his colleagues on the Executive Board forward sustainably and positioned the Group as an innovation and cost leader in the automotive supplier sector. We have the utmost trust in his capability to continue consistently on this roadmap and we want to continue this success together.”

As a result of the acquisition of TRW, ZF has substantially increased Group sales, with ZF TRW as the fifth division contributing €8.9bn. In addition, the Group’s regional distribution of sales is now also more balanced: The sales share in North America increased from 20 to 28%, while the share in Europe fell from 56 to 47%. The Asia-Pacific Region accounted for 22% of ZF sales (2014: 20%).

In line with the past few years, business performance in the key regions varied in 2015: Sharp growth in the North America and Asia-Pacific markets and moderate growth in Europe contrasted with a continued downturn in South America.

ZF expects Group sales for 2016 to be in the region of between €35bn and €36bm. The expected sharp increase in sales compared with 2015 is essentially based on the first-time full-year inclusion of ZF TRW. Over the medium term, ZF expects to see overall growth of 7% for the ZF Group, which is above-average for the market as a whole. The adjusted EBIT margin for 2016 is currently expected to be between 5 and 6%. ZF anticipates an adjusted EBITDA margin of over 10%.