FRANKFURT AM MAIN, Aug 23 — Shares in German auto parts giant Continental dropped more than 13 per cent yesterday after the group said annual profits would be slashed by falling sales and higher costs.
Stock in the Hanover-based firm plunged 13.2 per cent to trade at €160.85 (RM764.71) by noon in Frankfurt.
“Lowered sales expectations, cost increases and warranty claims are decreasing the adjusted operating result in the third quarter,” Continental said in a statement.
Rather than initial hopes for €47 billion of sales, the group now expects to bring in around €46 billion over 2018, pointing to exchange rate effects weighing on the forecast to the tune of €1 billion.
Revenue of €46 billion would still be an improvement of 4.5 per cent over last year’s turnover.
Meanwhile, Continental expects adjusted operating profits as measured by EBIT to amount to 9.0 per cent of sales, rather than “more than 10 per cent” as previously predicted.
Other household names of Germany’s vast car industry, including Daimler, BMW and Volkswagen, also lost some ground compared with a largely flat DAX index of blue-chip shares.
But with Mercedes-Benz parent Daimler down 1.8 per cent, BMW shedding 1.2 per cent and VW 1.1 per cent, their losses were far less drastic than Continental’s. — AFP
