Robert Bosch GmbH, the world’s biggest car-parts maker, forecast that profit margins would widen in 2014 as Europe’s economy recovers and extra costs from the solar-energy division it’s eliminating all but disappear.
Sizable charges aren’t expected this year, company officials said at a press briefing and adjusted for 1.3 billion euros ($1.8 billion) in charges related to exiting the unprofitable solar business, earnings before interest and taxes rose to about 6 % of sales in 2013 from about 5 % a year earlier, the Stuttgart, Germany-based company said.
“We want to make a further step toward our profitability goal” of an Ebit margin of 8 %, said Chief Executive Officer Volkmar Denner. Bosch plans to complete the withdrawal from the solar industry in the “coming weeks and months.”
Weakness in Europe’s industrywide car sales, which slumped for a sixth straight year in 2013, and the euro’s gains on currency markets held back sales growth at Bosch last year. According to preliminary figures, revenue rose 2.7 % to 46.4 billion euros, with foreign-exchange fluctuations causing a 1.5 billion-euro burden, the company said. In April, Bosch forecast an increase of as much as 4 %.
Bosch expects higher sales this year, boosted by a 3 % increase in global auto production. Currency moves aren’t expected to be a “significant” burden this year, Chief Financial Officer Stefan Asenkerschbaumer said at the briefing.