The third quarter was affected by the negative impact of commodity inflation and the shortage of semiconductors, which are destined to last at least for the rest of the year, so much so that Brembo has worsened the estimate on the 2021 EBITDA margin. Consolidated net revenues in the first nine months of the year amounted to 2,041.8 million euros, an increase of 30.9% (+ 32.6% at constant exchange rates, the Bloomberg consensus estimate of 1,994.8 million) compared to the same period of the year previous. At the same exchange rates and perimeter (following the acquisition of the Danish company SBS Friction with effect from 1 January 2021) the increase would be 31.7%. When compared with the first nine months of 2019, which represent a more homogeneous comparison with respect to the effects of the Covid-19 pandemic,
All the segments in which the group operates recorded a positive trend: the automotive sector grew by 26.3%, applications for motorcycles by 64% (+ 54.9% with the same consolidation perimeter), those for commercial vehicles by 35.3% and competitions by 29.6% compared to the same period of 2020.
While geographically, sales increased in Italy by 39.4%, in Germany by 29.9%, in France by 18.7% and in the United Kingdom by 31.6% (+ 30.9% at constant exchange rates. ). Most important growth in India (+ 43.9% and + 51.7% at constant exchange rates), in China (+ 32.5% and + 30.9% at constant exchange rates) and in Japan (+ 27.5% and + 27.2% at constant exchange rates). The North American market (United States, Mexico and Canada) with + 27.1% (+ 34% at constant exchange rates) and the South American market (Brazil and Argentina) with a + 32.4% (+46, 6% at constant exchange rates).
In addition, the gross operating margin (ebitda) at 30 September increased to 381.7 million (18.7% of revenues, 388.5 million the consensus estimate) from 267.1 million (17.1% of revenues) of the ” in the same period of the previous year, the EBIT amounted to 224.1 million (11% of revenues, 229.8 million the consensus estimate) from 110.6 million (7.1% of revenues) as at 30 September 2020. A against net financial charges and equity investments equal to 0.6 million (18.1 million at 30 September 2020) and a tax rate of 24.4% (from 21.5%), the net profit jumped by 135 , 2% to 168.7 million, or 8.3% of revenues, just below the consensus estimate of 172.9 million.
Finally, the net financial position dropped to 483.3 million (492 million the consensus estimate), 22.4 million less than at 30 September 2020. Without the effects of IFRS 16, the net financial debt would have been equal to 277.5 million, down by 42.6 million. The market was disappointed by the accounts of the third quarter alone due to the increase in production costs and the shortage of chips that creates volatility in customer orders: if consolidated net revenues improved more than expected by 11.9% at 681 million (+ 10.8% at constant exchange rates, the Bloomberg consensus expected 634 million), the EBITDA margin dropped by 10% to 111.4 million (118 million the Bloomberg consensus estimate), equal to 16.4 % of revenues.
In this regard, the company highlighted that “in the period under review there were strong and generalized increases in production costs, in particular as regards ferrous metals, energy and logistics, a large part of which is recovered through the usual indexing mechanisms. automatic contracts in place with major customers in the months following their occurrence “. Furthermore, he explained, “the global shortage of microchips that is affecting the automotive sector, while not having a direct impact for Brembo, has created considerable volatility in customer orders, not allowing optimal management of production capacity. These factors have contributed to the reduction in margins compared to the year and previous periods “.
Quarterly EBIT also dropped more than expected to 58.3 million (8.6% of revenues, it was expected at 64 million) from 71.8 million (11.8% of revenues) in the same period of 2020. The third The quarter closed with a profit of 41.7 million, equal to 6.1% of revenues, -19.4% year on year. This figure is also lower than the consensus expectations at 46 million. Results that, however, for the president, Alberto Bombassei, “show how the company has been able to generate revenue growth compared to the same period not only last year, but above all in 2019, doing better than the reference market. The fundamentals of the group are confirm solidity, thanks to the contribution of all the business segments in which we operate “.
However, Bombassei admitted that after a robust first half of the year, the quarter’s accounts saw “the strong negative impact of raw material inflation and the shortage of semiconductors”, exogenous factors destined to weigh on the automotive industry at least for throughout the rest of the year, although the demand for vehicles remains high.
In this difficult context and which causes uncertainties for the immediate future, Brembo’s strategy continues in the direction it has taken. “We have completed the acquisition of J.Juan in Spain (a company active in the development and production of brake systems for motorcycles, the total cost was 73 million euros, ed), thus completing the offer of our product portfolio for the motorcycle market. Furthermore, the recent introduction of our new Sensify intelligent braking system positions us as a pioneering company, ready to provide technological solutions for the vehicles of the future “, concluded Bombassei.
The group therefore continues to monitor and manage the strong tensions on the costs of raw materials, energy and transport, which in recent months have reached unprecedented levels. A part of them is recovered through the usual contractual indexing mechanisms with the main customers, with a time deferment with respect to their occurrence. The shortage of electronic components which is affecting the automotive sector and which will continue in the months to come, even if it does not have direct consequences on Brembo’s production, “nevertheless creates a considerable volatility in orders from customers, not allowing optimal saturation of the production capacity “, warned the company which, on the basis of the current scenario and the results achieved so far, expects
Currently the Bloomberg consensus expects revenues at the end of the year at 2,664 million, up from 2,209 million in 2020, an ebitda to 518 million (from 389 million in 2020) with a margin of 19.5%, an ebit to 302 million (from 181 million), a net profit of 226 million (137 million in 2020) and a net debt down to 366 million from 385 million. After the accounts and cut of the 2021 outlook, the Brembo stock in Piazza Affari fell by 1.44% to 11.62 euros. (All rights reserved)

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