TIDMTIFS
RNS Number : 1090S
TI Fluid Systems PLC
02 November 2023
Released: 2 November 2023
TI Fluid Systems plc
Q3 2023 Trading Update
Strong revenue growth, confident in 2023 outlook
TI Fluid Systems plc (TIFS), a global industry leader in highly
engineered automotive fluid storage, carrying, delivery and thermal
management systems for light vehicles issues, a trading update for
the third quarter and nine months ended 30 September 2023.
Highlights for the nine months ended 30 September 2023
-- Strong revenue growth year to date of 8.9%, and 12.4% at
constant currency, compared to market growth of 9.0%
-- Q3 revenue growth of 0.6%, and 7.0% at constant currency, compared to market growth of 3.8%
-- New BEV bookings with lifetime revenue of EUR819 million, of
which broadly half was in China
-- Strategic progress with the opening of the Group's fourth
E-Mobility Innovation Centre in Jiading, Shanghai in October
-- Executing revised capital allocation policy - acquisition of
Cascade Engineering Europe on track to close in Q4, share buyback
commenced in October, c.EUR100 million term loan prepayment in
August, and net leverage reduced to 1.7x adjusted EBITDA as of 30
September
-- Remain confident in full year outlook for revenue
outperformance, adjusted EBIT margin expansion to above 7% and
adjusted free cash flow conversion of c.30% of adjusted EBITDA
EUR million % Change
9 months 9 months at
ended ended constant LVP
Sep 23 Sep 22 % Change currency volume growth
Group Revenue 2,619.5 2,405.9 8.9% 12.4% 9.0%
By Segment
FCS 1,521.3 1,373.9 10.7% 14.3% 9.0%
FTDS 1,098.2 1,032.0 6.4% 9.8% 9.0%
By Region
Europe & Africa 1,012.7 880.9 15.0% 15.3% 12.1%
Asia Pacific 809.0 821.8 (1.6)% 5.9% 7.3%
North America 753.7 665.2 13.3% 15.4% 11.3%
Latin America 44.1 38.0 16.0% 24.7% 5.9%
Notes : LVP (Light Vehicle Production) volume herein based on
S&P Global Mobility, October 2023, and Company estimates.
Revenue Performance
Group revenue for the nine months ended 30 September 2023 was
EUR2,619.5 million, an increase of 12.4% at constant currency, with
strong growth across both segments and all regions. Reported
revenue growth was 8.9%, with a foreign exchange headwind due to
the strengthening of the Euro against most key currencies.
Fluid Carrying Systems (FCS) revenue increased 14.3% at constant
currency, reflecting strong industry volume growth, inflationary
cost recoveries and successful launches of thermal management
programmes for hybrid and battery electric vehicles. Fuel Tanks
& Delivery Systems (FTDS) revenue increased 9.8% at constant
currency, well ahead of the growth in addressable markets. This was
driven by inflationary cost recoveries, and our success on hybrid
vehicle platforms.
Europe & Africa and North America delivered particularly
strong growth. This reflects market volume growth, successful
thermal product launches and inflationary cost recoveries. The
impact of the UAW strike on Q3 revenue was limited. Assuming the
tentative agreements reached with the US OEMs result in a full
resolution, we expect only a modest revenue impact in Q4. In Asia
Pacific, revenue growth at constant currency was 5.9%, slightly
below light vehicle production volume growth. In China, the local
OEMs have continued to grow strongly, resulting in some ongoing
unfavourable mix. This was partially offset by new launches with
Chinese OEMs which are in the ramp up phase. We launched a further
nine programmes in China in Q3, giving a total of over 30 for the
year to date, and we expect further progress in Q4.
Outlook
We remain confident in our full year outlook, supported by the
Group's performance in the first nine months of 2023. We continue
to expect constant currency revenue growth outperformance compared
to GLVP growth, adjusted EBIT margin expansion to above 7%, and
adjusted free cash flow to be approximately 30% of adjusted
EBITDA.
Comment from Hans Dieltjens, CEO and President
"TI has delivered strong revenue growth in the first nine months
of the year and we are confident in our full year guidance for
revenue outperformance, strong EBIT margin expansion and robust
cash conversion. We continue to make strategic progress, confirmed
by our bookings for electrified vehicles.
As we outlined at our Capital Markets Day in September, we are
Taking the Turn to a successful future. Our strategy is focused on
capitalising on the opportunities of electrification while
leveraging the strengths of our conventional portfolio. In doing
so, we will drive sustainable growth and return to double-digit
adjusted EBIT margins in the medium term."
Trading update call
TI Fluid Systems plc is holding a call for analysts and
investors at 11:00 am UK time today.
Conference Call Dial-In
Details:
United Kingdom (Local) 020 4587 0498
United States (Local) 1 646 787 9445
All other locations Global Dial-In Numbers
Access code: 046071
You can pre-register to receive a unique PIN to dial directly
into the call using this link .
An audio recording will be available on our website
www.tifluidsystems.com in due course.
Enquiries
TI Fluid Systems plc
Kellie McAvoy
Investor Relations
Tel: +44 7354 846374
FTI Consulting
Richard Mountain
Nick Hasell
Tel: +44 20 3727 1340
Cautionary Statement
This announcement contains certain forward-looking statements
with respect to the financial condition, results of operations and
business of TI Fluid Systems plc (the "Company"). The words
"believe", "expect", "anticipate", "intend", "estimate",
"forecast", "project", "will", "may", "should" and similar
expressions identify forward-looking statements. Others can be
identified from the context in which they are made. By their
nature, forward-looking statements involve risks and uncertainties,
and such forward-looking statements are made only as of the date of
this announcement. Accordingly, no assurance can be given that the
forward-looking statements will prove to be accurate, and you are
cautioned not to place undue reliance on forward-looking statements
due to the inherent uncertainty therein. Past performance of the
Company cannot be relied on as a guide to future performance.
Nothing in this announcement should be construed as a profit
forecast.
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