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February 10, 2022 | Annual Financial Statement
Haldex Year-End Report, January - December 2021
Strong organic growth and record operating cashflow, margin impacted by temporary challenges in the supply chain

FOURTH QUARTER 2021

  • Sales increased to SEK 1,191m (989), corresponding to an organic growth of 19 percent.
  • Adjusted operating income amounted to SEK 60m (66), equivalent to an adjusted operating margin of 5.0 percent (6.7).
  • Reported operating income amounted to SEK 54m (44). Non-recurring expenses of net SEK 6m (22) impacted the operating income.
  • Earnings per share were SEK 0.98 (-1.27).
  • Cash flow from operating activities amounted to record high SEK 281m (123).
  • The structural savings programs developed according to plan and reduced expenses by gross SEK 20m.
  • The Board of Directors updated the growth target: Haldex should organically growth faster than the company’s end markets.
  • The Board of Directors proposes that no dividend be paid for the 2021 fiscal year.

FULL YEAR 2021

  • Sales amounted to SEK 4,612m (4,007). The organic growth was 21 percent.
  • Adjusted operating income increased to SEK 357m (163), equivalent to an adjusted operating margin of 7.7 percent (4.1).
  • The structural savings programs reduced expenses by gross SEK 154m for the full year.
  • Reported operating income amounted to SEK 341m (-100), corresponding to a margin of 7.4 percent (-2.5). Non-recurring expenses of net SEK 16m (263) impacted the full-year result negatively.
  • Earnings per share were SEK 4.65 (-6.44).
  • Cash flow from operating activities totaled SEK 296m (215).
  • The European Commission (EC) has decided to not pursue the complaint against Knorr-Bremse. Haldex will not object to the European Commission’s decision.

Comment from Jean-Luc Desire, President & CEO

Net sales showed strong improvement in the fourth quarter and reached SEK 1,191m (989), equivalent to an organic growth of 19 percent. The Americas and Europe reported strong organic sales growth of 24 and 25 percent respectively, while region Asia had an organic sales decline of 20 percent. The aftermarket segment grew 17 percent organically, with growth in both Europe and the Americas. It is positive to see high organic growth of 38 percent for the Trailer segment, and that our increased focus on this segment is showing results. We see improved underlying demand from our customers, and according to our assessment of external market data, we continue to take market share. Net sales for the full year amounted to SEK 4,612m (4,007), corresponding to an organic growth of 21 percent.

The adjusted operating profit amounted to SEK 60m (66), corresponding to margin of 5.0 percent (6.7) in the fourth quarter. Raw material and component prices as well as freight and logistics costs have been steadily and rapidly increasing throughout the course of 2021, and the constraints in the supply chain continued during the fourth quarter, which has had an impact on the result. In line with other industry players, Haldex increased prices for the aftermarket business and to OEM customers in the Americas and Europe, effective November and December, respectively. However, the actions taken did not have full effect during the fourth quarter. Haldex will continue to take action to ensure delivery of products to customers in a timely and cost-effective way.

The adjusted operating profit for the full year reached SEK 357m (163), corresponding to a strong margin of 7.7 percent (4.1). The reported operating margin of 7.4 percent (-2.5) is the highest since the split of the Group in 2011. The cashflow from operating activities was also record high, amounting to SEK 281m (123) in the quarter.

During the quarter, the Americas team secured a position with a leading axle manufacturer as the supplier of our low-weight Air Disc Brake (ADB).  Haldex worked cooperatively with a fleet customer to recommend the Haldex ADB product in a process known as “fleet-pull-through”, which resulted in a launch and specification of the Haldex ADB at a globally recognized fleet customer.  Many fleets look to this fleet customer as an industry trend setter, which will be beneficial for future air disc brakes penetration in the region.

In December, we launched our new vision - Driving Innovation for a Safer and Greener World - with a renewed strategy to 2025.  With the new vision, we show that Haldex is driving innovation within braking systems, actively moving ahead of the industry. Our solutions are safer in terms of braking stability, and greener in terms of energy efficiency. Through strategic partnerships, we challenge existing technology, while remaining an independent partner. The strategy consists of three pillars – optimizing the current business, capturing the strategic opportunities, and integrating sustainability into the business model. By delivering on the strategic activities under each pillar, Haldex will achieve profitable growth with a sustainable market position and profitability level while contributing to a sustainable environment. We aim to reach SEK 6b sales and a sustainable double-digit operating margin by 2025.

I am proud to share that Haldex has committed through the Science Based Target initiative to set company-wide emissions targets in line with climate science. The decision to be part of this initiative shows Haldex's alignment to the Paris Agreement and the ambition to reduce greenhouse gas emissions across the entire value chain. We have two years to develop targets and have them validated by the SBTi.

In connection with the strategic review, the Board of Directors also updated the financial growth target to organically grow faster than our end markets, which clearly states our ambition to continue to grow our market position. For the full year, our assessment is that on a global basis we are clearly taking market share within the Aftermarket and Trailer segments, while we are growing in line with the market for Trucks.

In summary, 2021 was a strong year for Haldex with several milestones reached, despite the uncertainties in both access to raw materials, components, and freight. Market signals indicate that there will not be any immediate relief in the supply chain situation until earliest the second half of 2022. Our cross-functional collaboration has ensured that we have handled situations that have arisen in the best possible way. Our employees have made this happen, and I would like to take the opportunity to thank everyone for their commitment.

For further information, please contact:

Jean-Luc Desire, President & CEO
Lottie Saks, CFO
Jenny Boström, Investor Relations Manager

Telephone: +46 (0)418 47 60 00
Email: ir@haldex.com">ir@haldex.com

This report has not been the object of review by the company’s auditors.

This information is such that Haldex AB (publ) is obliged to publish under the EU Market Abuse Regulation. The information was submitted for publication through the contacts set out above on Thursday, February 10, 2022 at 7.20 am CET.

Full year-end report
The full year-end report is available at https://www.haldex.com/en/corporate/investors or at http://news.cision.com/haldex

Investor presentation
Investors, analysts, and media are invited to an online presentation of the report on Thursday February 10, at 11.00 am, with CEO Jean-Luc Desire and CFO Lottie Saks.

The teleconference will be broadcasted live on the web.
Link to webcast and numbers to the teleconference: 
https://financialhearings.com/event/41588

The recorded webcast will be available afterwards, and both the interim report and the presentation can be downloaded from the Haldex website: https://www.haldex.com/en/corporate/investors/financial-reports/

About Haldex
Over 100 years of powerful innovation gives Haldex unsurpassed expertise when it comes to braking systems and air suspension systems for heavy trucks, trailers and buses. We live and breathe our business with the goal to deliver robust and technically superior solutions which is founded in a deep insight in our customer’s reality. Through focusing on our core competences and the passion we all share, we achieve the agility and flexibility that the market demands. Innovative collaborations aren’t only the core of our products, but our philosophy. Our 2 000 employees, spread out across four continents, challenge the conventional on a daily basis in order to secure that the products we deliver create a unique value to our customers and the end users. We are listed on Nasdaq Stockholm and have a turnover of approx. 4.6 billion SEK.

This document is essentially a translation of Swedish language original thereof. In the event of any discrepancies between this translation and the original Swedish document the latter shall be deemed correct.