Capital Markets Day 2022
Today, Kendrion is hosting its Capital Markets Day for investors and analysts, presenting strategic priorities, an update on the progress towards its 2025 financial targets, and various innovative products.
In the presentation, Kendrion’s three Business Groups, Industrial Brakes, Industrial Actuators and Controls and Automotive, will provide insight into their main sources of organic growth. There will be a separate update on progress made in China, where all three Business Groups are active.
The Automotive Group will announce the creation of two Automotive units: Automotive ‘Core’, with a disciplined focus on existing technologies for vehicles with an internal combustion engine (ICE), and Automotive ‘E’ concentrating on opportunities related to the transition towards Autonomous, Connected, Electrified and Shared mobility (ACES). The new organizational structure, which will be operational per 1 January 2023, is expected to allow Kendrion to further strengthen its position in the Automotive market and benefit from the megatrend towards cleaner energy and electrification.
Both Automotive Core and Automotive E will have full P&L responsibility with separate KPIs. Automotive Core will focus on operational excellence, production, cost efficiency, profitability and cashflow. Automotive E will concentrate on innovation, close collaboration with customers, project management, and profitable growth. Automotive Core currently generates around EUR 167 million or 72% of the Automotive revenue, while revenue in Automotive E amounts to EUR 67 million. The new organizational structure is expected to result in annual cost savings of around EUR 4 million. Associated one-off costs are expected to be EUR 6 million.
Kendrion’s strategy aims to deliver on several ambitious financial targets for 2025, first announced in September 2020:
- Grow organic revenue by at least 5% on average per year against the baseline year 2019
- An EBITDA margin of at least 15% in 2025
- A return on invested capital of above 25% in 2025, excluding acquisition-related intangibles
- Maintaining a dividend policy to distribute 35% to 50% of net profits
Joep van Beurden, Kendrion CEO
“I am proud that we are on track to achieve our ambitious 2025 financial goals that we announced two years ago amid the COVID pandemic.
Over the past two years, strengthened by our successful strategic acquisitions of INTORQ and 3T, we have transformed our industrial franchise. Our revenue and profitability are currently well above pre-pandemic levels, and we are well positioned to continue to benefit from the broad transition towards cleaner energy. In China we have grown substantially and have excellent prospects for further future growth. We are entering the final phase of the construction of a 28,000 m² factory in Suzhou’s Industrial Park, which will become Kendrion’s largest production facility.
The split of the Automotive Group into Core and E allows us to create even more focus on innovation and on products such as AVAS sound systems, active suspension, and sensor cleaning, while at the same time improving the efficiency and cash generation of the substantial business that we have with products related to the combustion engine.
We have made considerable progress towards achieving our strategic objectives and looking ahead, we continue to see organic growth opportunities in all three Business Groups and in China. We are confident to deliver our medium-term financial targets and are ready to capitalize on the transition towards electrification and cleaner energy.”
Today’s Capital Markets Day presentation starts at 2.00 pm CEST in Amsterdam. To participate in the live webcast, visit Capital Markets Day 2022. All relevant information will be published on Kendrion’s website.
The Executive Board
For more information, please contact:
Mr. Joep van Beurden
Chief Executive Officer
Tel: +31 6 8330 1112
- Press release
- Presentation (available at 6.00 pm CEST)
- Recording live webcast (available at 6.00 pm CEST)