Schaeffler
The profit warning is the result of the problems of the entire car industry.
Munich SchaefflerChief Klaus Rosenfeld summoned his executives to a telephone conference on Tuesday afternoon. There was a need for explanation: For the umpteenth time since the IPO four years ago, the automotive supplier had set its forecasts down. “The decision to make the correction was very difficult for us,” Rosenfeld told Handelsblatt. “But we can not rely on a recovery in the global automotive business in the second half of the year.”
The message of Rosenfeld also to his top managers: “This is not a special one SchaefflerProblem. “After all, car manufacturers also had BMW and Daimler, Suppliers like Continental and Leoni already issued profit warnings. Rosenfeld expects global car production to fall by four percent in 2019. In February, when he announced the original forecast, he had assumed a minus of only one percent.
And the Schaeffler boss also highlighted the positive results: The cash flow development in the second quarter shows that the austerity measures are starting to take effect. And the long-suffering industrial business recently reached margins of almost twelve percent, grew by five percent and stabilized the entire group.
But one thing is for sure: Schaeffler is far from past earnings power. Although the operating return on sales of now expected seven to eight percent in the industry comparison can be seen more than. In the second quarter, before special items, it was 7.9 percent with a slight decline in sales of 3.6 billion euros.
Schaeffler is thus no acute crisis case. But the Herzogenauracher Group had long double-digit margins can show. In the wake of numerous profit warnings, the company even flew out of the MDAX. Whether the good old days come back in full splendor is uncertain. As a specialist in precision mechanics, the company is even more difficult to change into the age of electronics than other suppliers. Even more than half of the sales depend on the internal combustion engine.
Of course, Rosenfeld is trying to counteract e-mobility. The first successes have been achieved: In the second quarter, the E-Mobility Division won an order from a global premium manufacturer in e-motor production worth EUR 1.1 billion, according to Rosenfeld.
Nevertheless, many other companies in such a situation, the CEO would be called into question. Rosenfeld sits according to information from the environment of the family but firmly in the saddle. “They are firmly convinced that he can best analyze the problems and implement the right measures,” says the family. “The Schaefflers are fully behind Rosenfeld.” Maria-Elisabeth and Georg had exactly registered that the restructuring of the industrial business is fruitful. Now they are hoping for a similar development in the automotive sector.
This is probably true for Continental – The Schaefflers are also in charge of the Hanoverian supplier. But there are only a few connections between Conti and Schaeffler AG. The two holdings hang side by side at the family holding.
Car division needs more margin
Perhaps also a reason for the loyalty to Rosenfeld: The family has undoubtedly much to thank Klaus Rosenfeld. When the acquisition of Continental was too expensive in the turmoil of the financial crisis and too many shares were offered, the existence of the family concern was threatened. It was Rosenfeld, who switched from the creditor Dresdner Bank to Schaeffler, deftly restructured the finances and gradually reduced the debt to a manageable level.
Although the assets of Schaeffler and Continental AG have slipped a bit in recent months, Maria-Elisabeth and her son Georg Schaeffler are once again among the wealthiest in the country thanks to Rosenfeld.
The reward: Rosenfeld rose from the CFO to the interim CEO, prevailed in a power struggle against Klaus Deller and became the permanent CEO of Schaeffler AG. Since then, it has been necessary to prove that the trained financier also understands the operative business of the auto industry.
Since the cyclical wind has turned Rosenfeld creates a program after the next. Race is the name of the youngest, abbreviation stands for “Regroup Automotive for Higher Margin and Capital Efficiency”. The car division should therefore be rebuilt for higher margins and better capital efficiency.
Some criticize this as actionism, he himself believes that speed and discipline are crucial in these times. “Now it all depends on who has his car business under control?”, Rosenfeld said in an interview with Handelsblatt. The efficiency programs would have to be implemented consistently.
According to industrial circles Rosenfeld agrees closely with Georg Schaeffler. The majority of the shares have been with the Junior for years, and he leads the Supervisory Board from the beginning. Georg Schaeffler has grown into the role, according to industry circles. In public, his mother is still valid Maria-Elisabeth Schaeffler-Thumann as the main owner. But she has withdrawn strongly from the public and also from the company. She is celebrating her 78th birthday in Kitzbühel shortly.
More: Schaeffler, Mahle, Eisenmann: Suppliers are feeling the consequences of the car crisis. Across sectors, the Group eliminates jobs, closes factories and gives profit warnings.