Continental AG, pharmacy Europe’s second-largest auto-parts maker, raised its full-year earnings forecast as growth in China and North America make up for the effects of the euro’s gains on currency markets.
The Hanover, Germany-based company said in a statement today that earnings before interest and taxes, and adjusted for one-time items and acquisitions or disposals, will total at least 10.5 % of revenue in 2013. That compares with an earlier forecast of a margin exceeding 10 %. Third-quarter Ebit rose 16 % to 886.3 million euros ($1.2 billion), beating the 819.8 million-euro average of five analyst estimates.
“Despite the weaker European automotive market, we continued on our successful path,” Chief Executive Officer Elmar Degenhart said in the statement. “In the meantime, however, we are experiencing a stabilization of the business trend in Europe.”
Car production grew “strongly” in China and Southeast Asia in the first nine months of the year, the manufacturer said. The company raised its forecast for North American auto production to an increase of 4 % versus an earlier estimate of a 3 % gain. Carmaking in Europe, which will probably decline 3 % for the full year, has stabilized, helped by both “steadying” local demand and German vehicle exports to China and the U.S., Continental said.
Continental, also Europe’s second-largest tire producer, has partly sidestepped the effects of the region’s car-market contraction by widening supply offerings to customers including Volkswagen AG, BMW AG and General Motors Co. in growing markets such as China and the U.S. The company has kept up earnings with a focus on high-technology parts such as safety sensors, emergency-brake systems and fuel injectors.