Results at 30 September 2021
Brembo’s Board of Directors chaired by Alberto Bombassei examined and approved the Group’s results at 30 September 2021.
Net consolidated revenues amounted to €2,041.8 million, up 30.9% (+32.6% on a like-for-like exchange rate basis) compared to the same period of the previous year. On a like-for-like exchange rate and consolidation basis (the latter following the acquisition of the Danish company SBS Friction, effective 1 January 2021), the increase would have been 31.7%. Compared to the first nine months of 2019 — a more homogeneous comparison in light of the effects of the Covid-19 pandemic — 9M 2021 revenues grew by 3.6%.
In the reporting period, all segments in which the Group operates performed very well: the car segment rose by 26.3%, motorbike applications by 64.0% (+54.9% on a like-for-like consolidation basis), applications for commercial vehicles by 35.3% and those for racing vehicles by 29.6% compared to the same period of 2020.
At geographical level, sales rose by 39.4% in Italy, 29.9% in Germany, 18.7% in France and 31.6% in the United Kingdom (+30.9% on a like-for-like exchange rate basis). India grew by 43.9% (+51.7% on a like-for-like exchange rate basis), China by 32.5% (+30.9% on a like-for-like exchange rate basis) and Japan by 27.5% (+27.2% on a like-for-like exchange rate basis). The North American market (USA, Mexico and Canada) rose by 27.1% (+34.0% on a likefor- like exchange rate basis) and the South American market (Brazil and Argentina) grew by 32.4% (+46.6% on a like-for-like exchange rate basis).
At 30 September 2021, the cost of sales and other net operating costs amounted to €1,294.8 million, with a 63.4% ratio to sales, down slightly in percentage terms compared to 63.6% for the same period of the previous year (€992.2 million).
Personnel expenses amounted to €376.6 million, with an 18.4% ratio to sales, decreasing compared to the same period of the previous year (19.6% of sales). At 30 September 2021, workforce numbered 11,539 (of which 107 from the newly acquired SBS Friction), compared to 11,039 at 31 December 2020 and 11,402 at 30 June 2021.
At 30 September 2021, EBITDA amounted to €381.7 million (EBITDA margin: 18.7%), up compared to €267.1 million (EBITDA margin: 17.1%) for the same period of the previous year. 3/8 EBIT was €224.1 million (EBIT margin: 11.0%) compared to €110.6 million (EBIT margin: 7.1%) at 30 September 2020.
Net interest expense from investments amounted to €0.6 million (€18.1 million at 30 September 2020); this item included exchange gains for €3.4 million (exchange losses for €7.8 million for the same period of the previous year), interest expense for €8.0 million (€10.3 million at 30 September 2020) and interest income from investments amounting to €4.0 million (€48 thousand at 30 September 2020).
Pre-tax profit was €223.5 million compared to €92.5 million at 30 September 2020. Based on the tax rates applicable under current tax regulations in force in each country, estimated taxes amounted to €54.6 million (€19.9 million for the same period of 2020), with a tax rate of 24.4% compared to 21.5% for the same period of the previous year.
The reporting period ended with a net profit of €168.7 million, accounting for 8.3% of sales.
Net financial debt at 30 September 2021 amounted to €483.3 million, down €22.4 million compared to 30 September 2020. Without the effects of IFRS 16, net financial debt would have been €277.5 million, down €42.6 million compared to 30 September 2020.
Q3 2021 results
In the third quarter of 2021, net consolidated revenues amounted to €681.0 million, increasing by 11.9% (+10.8% on a like-for-like exchange rate basis) compared to the third quarter of 2020 and by 5.2% compared to the third quarter of 2019. On a like-for-like exchange rate and consolidation basis (the latter following the acquisition of the Danish company SBS Friction, effective 1 January 2021), the increase would have been 10.1%.
In the third quarter of 2021, the cost of sales and other net operating costs amounted to €450.9 million, with a 66.2% ratio to sales, up in percentage terms compared to 63.2% for the same period of the previous year (€384.5 million).
EBITDA for the quarter amounted to €111.4 million (EBITDA margin: 16.4%), down 10.0% compared to the same quarter of 2020. During the reporting period, there were sharp, widespread increases in production costs, particularly for ferrous metals, energy and logistics, which are largely recovered in the months after those in which they occur through the usual automatic indexing mechanisms of contracts in place with the Company’s main clients. In addition, the global microchip shortage affecting the automotive sector, despite not having a direct impact on Brembo, created considerable volatility in client orders, preventing optimal management of production capacity. These factors contributed to reducing margins compared to the previous year and the previous quarters.
EBIT was €58.3 million (EBIT margin: 8.6%) compared to €71.8 million (EBIT margin: 11.8%) for the third quarter of 2020. The reporting period ended with a net profit of €41.7 million, accounting for 6.1% of sales.
Closing of J.Juan acquisition
On 4 November, Brembo finalised the acquisition of J.Juan Group, a Spanish company specialising in the development and production of motorbike braking systems.
The total outlay for the transaction was €73 million, paid using available liquidity and subject to the usual adjustment mechanisms applicable to similar transactions, that will be completed over the next 80 working days.
The acquisition of J.Juan will enable the Group to complete its range of solutions for the motorbike braking system and to expand its brand family for the growing motorbike sector.
Foreseeable Evolution
The Group continues to monitor and manage the strong tensions linked to the costs of raw materials, energy and transportation that have reached unprecedented levels in recent months. They are partly recovered, in the months following their occurrence, through the usual contractual indexing mechanisms in place with the Company’s main clients. Despite not having a direct impact on Brembo, the electric component shortage that is currently affecting the automotive sector — and is set to continue also in the forthcoming months — creates considerable volatility in client orders, preventing optimal saturation of production capacity.
On the basis of the current scenario and the results achieved to date, for financial year 2021 the Group expects revenue growth of between 20% and 25% compared to the previous year and EBITDA margin in the range of 18%-19%.
