Kongsberg Automotive ASA Business Report FY ended Dec. 2013

Business Highlights

Financial Overview

(in million EUR)
  FY ended Dec. 31, 2013 FY ended Dec. 31, 2012 Rate of Change
(%)
Factors
Overall
Sales 990.9 1,001.1 (1.0) 1)
EBITDA 97.1 77.0 26.1 -
Operating revenues by business segment
Driveline 279.8 308.9 (9.4) 2)
Interior 305.0 304.5 0.2
Driver Control 248.5 248.6 0.0
Fluid Transfer 189.0 176.0

7.4


Factors
1) Overall Sales
-Revenues for FY ended Dec. 31, 2013 remained almost flat, declined 1% from 2012. Lower revenues were partly offset by increased sales in the commercial vehicles segment, which was primarily driven by a pre-buy effect from the introduction of the Euro 6 emission standard.

2) By business segment
-Only Driveline showed decline of 9.4% year-on-year. Interior and Driver Control remained almost flat, and Fluid Transfer increased 7.4% year-on-year.

Joint Ventures

-The Company has acquired a further 24% stake in Shanghai Kongsberg Automotive Dong Feng Morse Ltd (SKADFM), bringing its total ownership in the business to 75%. The Company paid approximately CNY 19 million (EUR 2.3 million, or NOK 17 million) in cash for the 24 % stake. SKADFM, a joint venture company established in 1995, is a producer of pedals and cable shifters to the commercial vehicles produced in China. (From a press release on January 22, 2013)

Contracts

-Major Contracts in 2013 (From a press release in 2013)
Customer Product Contract detail and value Remark
Interior
Premium European car maker Massage systems for driver and passenger seats EUR 62.5 million -The production commences in the second quarter of 2015 at Pruszkow, Poland.
High-end vehicle platforms in North America Lumbar support systems EUR 2.4 million -The production commences in the third quarter of 2015 at Reynosa, Mexico.
North American vehicle platform Lumbar support systems for passenger seats EUR 1.2 million -The production commences in the third quarter of 2015 at Reynosa, Mexico.
D segment sports car sold in North America Handle and seat cable assemblies EUR 0.8 million -The production commences in the second quarter of 2014 at Matamoros, Mexico.
New model of a premium European SUV manufactured in the UK and China New generation of seat actuators EUR 25 million -The supply commences at the end of 2014 at Siofok, Hungary.
Tier 1 seating supplier
(for a premium Japanese SUV produced in North America)
Cable packages EUR 6.35 million -The supply commences in 2015 at Matamoros, Mexico.
Global car maker, for crossover SUV and C segment sedan car in China Seat heat systems EUR 11.2 million
(7 years)
-The production commences in the second half of 2015 at Wuxi, Jiangsu Province, China.
European compact crossover SUV, produced and sold in China Seat heating systems for both the front and rear seats EUR 4 million
(5 years)
-The production commences in September 2014 at Wuxi, Jiangsu Province, China.
European premium crossover, manufactured and sold in China Pneumatic seat support systems EUR 3 million
(5 years)
-The production commences in October 2014 at Wuxi, Jiangsu Province, China.
American mid-size sedan Pneumatic seat support systems EUR 17.2 million
(6 years)
-The production commences in the second quarter of 2015 at Reynosa, Mexico.
Crossover SUV for the North American market Head restraints and arm rests EUR 12 million
(4 years)
-The production commences in the fourth quarter of 2015 at Reynosa, Mexico and Milan, Tennessee, USA.
Premium European car maker for a range of passenger cars and SUVs Hood release cables -The production commences at the end of 2014 at Siofok, Hungary.
Premium European car brand Seat support systems, massage systems and light duty cables EUR 35 million
(5 years)
-The production commences in 2014 at Puszkow, Poland and Siofok, Hungary.
Driveline
Major European car maker,
B Segment cars sold in India and South America.
Complete manual gear shift systems EUR 33 million
(4 years)
-The production commences in the third quarter of 2015 at Jundiai, Brazil and Gurgaon, India.
Major European car maker, C segment cars in China market Automatic gear shifters EUR 14 million
(5 years)
-The production commences in the first half of 2014 at Wuxi, Jiangsu Province, China.
Major Chinese car maker, C and D Segment cars sold in China Automatic and Manual gear shifters EUR 102 million
 (5 years)
-The production commences in the second half of 2014 at Wuxi, Jiangsu Province, China.
Major European car maker, B Segment cars sold in South America Part of the gear shift linkages EUR 37 million
(5 years)
-The production commences in the second half of 2015 at Jundiai, Brazil.
Major European car maker, B Segment cars sold in Europe Complete manual gear shift systems EUR 15 million
(4 years)
-The production commences in September 2013 at Cluses, France.
Models for the Indian market Manual shift cables EUR 10 million
(6 years)
-The production commences in the third quarter of 2015 at Gurgaon, India.
Major European car maker,
B Segment cars sold in Europe and later also in the emerging markets
Complete manual gear shift systems EUR 150 million
(7 years)
-The production commences in the first quarter of 2015.
Geely Automobile, new mid-size platform Automatic shifters EUR 21 million
(5 years)
-The production commences in 2014 at Wuxi, Jiangsu Province, China.
Fluid Transfer
Braking & vehicle control systems for truck & bus Air Brake coupling and related components EUR 18.2 million
(3 years)
-The production commences at Raufoss, Norway.
European manufacturer of Heavy duty trucks Power-Train assembly ranges which utilizes the high-temperature products EUR 3.8 million
(6 years)
-The production commences late 2013 at Epila, Spain.
Europe's premier manufacturer of commercial vehicles Technical hose assemblies used in the fuel and brake systems EUR 5.3 million
(3 years)
-The production commences in Summer 2013 at Epila, Spain.
Global vehicle manufacturer, for China market Brake tube ASSYs EUR 10 million
(5 years)
-The production is expected to start in 2015 at Wuxi, Jiangsu Province, China.
Driver Control
Major manufacturers of Heavy Duty Trucks, for South American market Clutch actuation products, gearshift systems and cabin stabilizers EUR 20 million
(5 years)
-The supply commences in the fourth quarter of 2013.
Turkish Commercial vehicle manufacturer Clutch servos EUR 6.2 million
(5 years)
-Annual vehicle volume: 17,000
-The production commences in the second quarter of 2015 at Hvittingfoss, Norway.
Indian commercial vehicle manufacturer,
New Generation Truck platform (multiple models)
Cable gear shift systems for manual transmissions EUR 22.8 million
(4 years) 
-Annual vehicle volume: 80,000
-The production commences in the first quarter of 2013 at Pune, India.

R&D

R&D Expense

(in million EUR)
  FY ended Dec. 31, 2013 FY ended Dec. 31, 2012 FY ended Dec. 31, 2011
Overall 48.6 47.1 44.8
% of Sales 4.9 4.7 4.5

R&D Structure

-The Company's overall spending on R&D totaled 4.9 % of sales in 2013. This involves a team of approximately 429 highly skilled people.

-There are five global tech centers, and they are located in the USA (Novi), China (Wuxi), Germany (Hallbergmoos), Sweden (Mullsjo) and Norway (Kongsberg).

Product Development

e-Power unit
-The Company's e-Power unit has been nominated for its development program for an on-board charger for a hybrid city bus, from a global, market leading car maker.

Investment Activities

Capital Expenditures

(in million EUR)
  FY ended Dec. 31, 2013 FY ended Dec. 31, 2012
Driveline 6.0 8.2
Interior 7.3 8.3
Driver Control 8.7 6.8
Fluid Transfer 6.0 5.3
Eliminations & other (0.1) 0.0
Total 27.9 28.6

Investment Outside Norway

Fluid Transfer
<UK>
3,000 square meter extension to the UK manufacturing plant in Normanton opened in November 2013. This is the biggest investment there since the plant opened in 1992, creating 100 new jobs.