Haldex Reports Fourth-Quarter Net Loss, Profitable Year
Brake manufacturer Haldex AB reported a net loss and even revenue in the 2016 fourth quarter, compared with a year earlier, as profits rose and revenue slipped for the full year.
Also, Haldex CEO Bo Annvik, who previously announced his resignation, will leave Feb. 28. Chief Financial Officer Åke Bengtsson will become interim CEO, the company said.
Meanwhile, Knorr-Bremse AG’s proposed acquisition of the Swedish company is ongoing. The Munich-based company said it had extended its offer until June 16 from Feb. 28.
Haldex posted a fourth-quarter net loss of $6.3 million, or 14 cents per diluted share, for the period ended Dec. 31, compared with net income of $5.4 million, or 12 cents, in the 2015 period.
Revenue totaled $118 million, which is on par with the same period of the previous year, the company said.
Revenue followed the general market trend in 2016: in North America, which represents more than half of its net sales, conditions were weak during the year and demand fell even more during the fourth quarter, according to Haldex.
However, its revenue in North America during the fourth quarter did not decline at the same rate as the market, the company said. Revenue in Europe and Asia increased during the fourth quarter but could not compensate for the decrease in North America. Disc brake sales increased significantly during the fourth quarter and the full year, but sales of actuators and brake adjusters declined.
“Disc brake sales continued to show strong growth throughout the year. This increase is in line with previously announced expectations that this product category would be on the rise this year and then hopefully gradually reach even higher volumes over coming years,” Annvik said in a statement Feb. 10.
“However, it is crucial for the future development of the disc brakes that we win several of the major negotiations in which we are currently participating," he said. "The uncertain ownership situation creates greater risk for the customers, but to date we have managed to stay in the customer discussions by offering flexible arrangements. There is an overhanging risk that we will lose business, which in turn will impact our growth opportunities."
Year-to-date net income was $10.2 million, or 22 cents, compared with $21.4 million, or 48 cents a year earlier.
Revenue totaled $490 million, which currency-adjusted is a 9% decline, Haldex said.
A bidding process for Haldex began in July, the company said.
Knorr-Bremse in September offered $14 a share, or about $540 million, and anti-trust investigations are in progress; when and if approval is obtained, the offer can be completed, Haldex said.