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Schaeffler presents amended financial ambitions for 2020

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2016-11-09 | Herzogenaurach

  • “Mobility for tomorrow” strategy presented to public today
  • Financial ambitions 2020 for sales growth, EBIT margin and Free Cash Flow presented in July 2016 confirmed
  • New Earnings per Share target of 2.0 Euros per share by 2020
  • New Gearing Ratio target of <75% by 2020 focusing on balance sheet quality
  • Dividend payout ratio increased to 30-40% of net income

The demands on mobility are rapidly changing and require new responses. In order to address this challenge, Schaeffler AG has further developed the Group strategy »Mobility for tomorrow« and presents it to the public today. Following the realignment of the corporate and capital structure over the last years, »Mobility for tomorrow« sets the course for sustainable profitable growth of Schaeffler in the future. Key focus areas of the strategy are E-mobility, Industry 4.0 and digitalization.

In this context, the company has amended its Financial Ambitions for 2020. On an operational level, Schaeffler continues to envisage sales growth of 4-6 percent p.a. (FX-adjusted) on average, an EBIT margin before one-off effects of 12-13 percent p.a. and a Free Cash Flow of around EUR 900 million, as presented during the Capital Markets Day in July 2016.

Furthermore, the financial ambitions comprise an Earnings per Share (EPS) target for 2020. EPS is expected to increase to around 2.00 Euro per share in 2020. In addition, following the realization of Schaeffler’s debt-reduction strategy ahead of schedule, the leverage target has been replaced by a gearing ratio, measured by net-debt-to-equity, that is intended to be reduced to <75 percent in 2020. This reflects the intention to continuously improve the balance sheet strength. Further, the company has increased its dividend payout ratio from currently 25-35 percent to 30-40 percent of net income.

The renewed financial ambitions continue to be based on moderate growth assumptions for both divisions and are before one-off effects. In addition, any external growth through acquisitions is not taken into account. As part of the strategy »Mobility for tomorrow«, the Group plans smaller additive acquisitions in the three-digit million Euro range, aimed at improving and complementing its competency profile with regard to key technologies.

Forward-looking statements and projections
Certain statements in this press release are forward-looking statements. By their nature, forward-looking statements involve a number of risks, uncertainties and assumptions that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. These risks, uncertainties and assumptions could adversely affect the outcome and financial consequences of the plans and events described herein. No one undertakes any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. You should not place any undue reliance on forward-looking statements which speak only as of the date of this press release. Statements contained in this press release regarding past trends or events should not be taken as representation that such trends or events will continue in the future. The cautionary statements set out above should be considered in connection with any subsequent written or oral forward-looking statements that Schaeffler, or persons acting on its behalf, may issue.

Publisher: Schaeffler AG
Country: Germany

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