Continental
In 2021, Conti shareholders are expected to miss out on dividends for the first time in eleven years.
(Photo: dpa)
Düsseldorf The 2020 corona year left its mark on Continental’s balance sheet. The board of directors around the new Conti boss Nikolai Setzer therefore wants to forego a dividend distribution in the current year. The last time shareholders of the DAX supplier had to forego a dividend in 2010.
“In the course of the preparation of the 2020 annual financial statements, the Executive Board of Continental AG decided today to propose to the annual general meeting on April 29, 2021 not to distribute a dividend for the 2020 financial year,” said the Compulsory notification from the company. The company continues to adhere to its basic, medium-term dividend policy of a distribution of 15 to 30 percent of consolidated profit.
With the decision to suspend the dividend distribution, Conti boss Setzer is taking a step towards the employee representatives. Group works council Hasan Allak had already called at the end of January to forego a shareholder payment in view of the numerous job cuts and the difficult restructuring at the auto supplier.
There should be no dividend for the year 2020, which is characterized by further cuts and the Corona sales crisis. “Anyone who leads numerous fixed-cost debates at the locations and implements job cuts has nothing to distribute,” said Allak.
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Continental is involved in a complicated realignment of mechanics and hydraulics towards more and more electronics, sensors and software. In the “old” world of automobiles, jobs are noticeably disappearing, and not all employees can be taken into the “new” world – despite further training programs.
The tire business recently remained profitable overall. But here, too, the board of directors uses the red pencil – to the incomprehension of trade unionists and also a number of politicians who did not feel involved before the latest savings decisions.
Last year, the Annual General Meeting had therefore already decided to cut the dividend for the shareholders. They received a distribution of three euros per share for the 2019 financial year. That was less than the original proposal of four euros and meant that the Schaeffler Holding, the largest shareholder with 46 percent, would lower the dividend by a little less than 100 million to 276 million euros.
However, there had also been voices who wanted the owners to be more willing to do without in view of the sensitive Corona situation. In addition, in the year before the virus crisis, Conti had lost billions due to high depreciation and problems on the Chinese market. However, Conti itself expects a positive adjusted profit margin for the 2020 financial year.
More: The new CEO of the automotive supplier wants to grow faster in the future business with autonomous driving and software. However, Setzer does not rule out a further tightening of the austerity program.