ZF financial results have been released a few days ago. The year 2019 was quite a stable one, with some concerns about the overall turnover and EBIT margin. The current year will be a tricky one, due to the coronavirus outbreak and its consequences on production and global economy.
Let’s start from the turnover. In 2019, ZF generated sales of 36.5 billion euro, slightly lower compared to the previous year (36.9 billion). Adjusted EBIT was 1.5 billion euro, lower than 2.1 billion euro recorded in 2018, with adjusted EBIT margin at 4.1 percent (5.6 percent in 2018).
At the same time, R&D expenditure increased to 2.7 billion euro, 0.2 billion more than the previous year. New orders have also been made for electric drives in the car and bus segment.
CEO Scheider comments ZF financial results
«At present, we are witnessing how the markets are collapsing overnight», said ZF CEO Wolf-Henning Scheider. «At ZF, we have reacted quickly and decisively to the spread of the coronavirus and have prioritized the health and interests of our employees in line with those of the company in the best way possible. Our aim is to pursue our ZF way by securing employment and income wherever the appropriate tools are available. In doing so, we are acting in a socially responsible way and contributing to protecting the health of our employees. Furthermore, we can help to stabilize the economic situation which is volatile for all companies currently».
Not fully satisfied with the figures
Scheider emphasized that ZF stays confident even in this serious situation and is preparing to ramp up the plants in Europe and the U.S. after customers resume production. In Asia, production has already been resumed.
ZF has reacted consistently to the weaker markets, reviewed and postponed investments, and agreed closing days at several locations, purely through operational flexibility instruments. «We were able to adjust our cost structure to the changed market situation». said ZF CFO Konstantin Sauer. «This allowed ZF’s results to remain within the forecasted range that was revised mid-2019. However, these figures do not meet our long-term strategic goals. We therefore continue working on our cost structure in order to achieve further improvements». The increased digitalization of business processes should also contribute to this.