Production at the plant had to be temporarily interrupted because of the war.
(Photo: Future Publishing/Getty Images)
Munich Higher losses put the auto supplier Leoni under pressure. In the third quarter, the minus in the group rose from 27 to 88 million euros. “It’s not without good reason that experts are talking about the perfect storm that the automotive supplier industry is facing,” said CEO Aldo Kamper on Tuesday. The increasing costs for materials and logistics as well as stressed supply chains and volatile product calls made things difficult for the industry.
Leoni has been in crisis for years. The start-up of a new plant in Mexico had turned out to be a disaster, and the company was one of the first to apply for state aid during the corona pandemic. With the help of a restructuring program and negotiations with the banks, Kamper managed to put the finances on a more solid footing. But the challenges remain great.
The sales of the wiring systems specialist increased in the third quarter in the continued business areas by seven percent to 955 million euros. In addition to organic growth, “cost reimbursements received” also contributed to this. However, the operating loss from continued operations (EBIT) increased from 20 to 71 million euros.
In response to the challenges, Kamper announced: “We maintain strict cost controls, hold intensive discussions with our customers and invest in our future.”
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At the beginning of July, Leoni had agreed in principle with the banks on a refinancing plan to extend existing financing instruments until the end of 2025. Among other things, the agreement provides that net proceeds of up to EUR 442 million from the sale of the cable division will be used to reduce debt. The underwriters can also convert part of their loans into equity instruments.
In spite of the many challenges, other automotive suppliers had in some cases fared better recently. Conti was able to significantly increase its operating profit in the third quarter. The bottom line, however, was that the Dax group also made losses due to depreciation. Vitesco was also able to improve sales and the operating result.
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