The following is a summary of the Fuchs SE (FUPBY) Q4 2023 Earnings Call Transcript:
Financial Performance:
Fuchs SE reported an annual sales increase of 4% and a 13% rise in EBIT.
EBIT margin improved to 11.7%, over 1 percentage point above the previous year.
The company boasted record free cash flow at €465 million, mainly due to significant impacts from working capital and slightly lower raw material costs.
Gross profit rose nearly 9%, and EBIT margin surged to 11.7%, despite currency impacts.
Proposed a dividend increase of €0.04 per share.
Investment remained consistent with previous years, at around €80 million.
The company responded proactively to raw material price dynamics throughout the year.
The outlook for 2024 foresees increases in sales volume and EBIT, but a normalization in free cash flow to a cash conversion rate of about 0.8.
Business Progress:
Fuchs SE is expanding worldwide infrastructure, with new operating companies appearing in Chile, Romania, and Vietnam.
Established partnerships with global key players like DMG Mori, Hitachi Astemo, and John Deere.
The company sees potential in the EV market and intensifies its customer segmentation.
Working on its Fuchs 100 project, a successor of its strategic plan, Fuchs 2025.
Remarks about a continuation of its share buyback program.
Anticipates major steps to be taken in 2025, predicting recovery of various economies.
Actively working on potential acquisitions and pursuing operational excellence levels, including the S/4 project.
For 2025, Fuchs SE is targeting mid-single-digit revenue growth, two-thirds of which is expected to be volume and one-third is expected to be pricing.
To achieve growth in the Americas and Asia-Pacific, the company is deploying a segmentation approach, focusing on various industries.
More details: FUCHS SE UNSP ADR EACH REP 0.25 PRF SHS IR
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