Germany-based Norma Group’s 2020 sales was down 13.4 percent to 952.2 million euro (2019: 1,100.1 million euro). In organic terms, sales for the full year 2020 fell by 12.1 percent, with negative currency effects further reducing sales by 1.3 percent. However, the company met the forecast for fiscal year 2020 and also exceeded it slightly.
The company generated sales of 261.2 million euro in the fourth quarter, matching the previous year’s level (Q4 2019: 261.4 million euro). On an organic basis, sales from October to December 2020 increased by 3.8 percent compared to the same period of the previous year. That said, negative currency effects reduced sales by 3.9 percent. The adjusted EBITA margin was 8.2 percent (Q4 2019: 9.8 percent).
Dr Michael Schneider, CEO of Norma Group said, “Our business proved to be robust overall in a difficult economic environment in 2020. The first half of the year was impacted by the rapid spread of the Covid-19 pandemic. In the second half of the year – following initial signs of recovery in China – we observed a significant increase in demand from our customers worldwide. Our special thanks go to our employees, who showed great dedication and flexibility under difficult pandemic conditions.”
Full year performance hit by Covid-19
According to preliminary figures, adjusted earnings before interest, taxes and amortisation of intangible assets (adjusted EBITA) declined by 62.3 percent to 54.6 million euro in fiscal year 2020 (2019: 144.8 million euro). The adjusted EBITA margin for the full year 2020 was 5.7 percent (2019: 13.2 percent). This includes around 29.1 million euro in costs for the ‘Get on track’ change program launched in 2019, which are not adjusted for the sake of transparent presentation. The change program includes the optimisation of site capacities in all regions, streamlining of the product portfolio and strengthening of the global purchasing organization. From 2023 on, this program is expected to generate annual savings of around 50 million euro.
The economic impact of the pandemic was the main reason for the decline in earnings and the margin in fiscal year 2020. In particular, the large-scale economic standstill in Europe and America in the spring of 2020 caused a significant slump in orders. The recovery of the order situation in the second half of the year could not fully compensate for the decline in the first half of the year.
Dr Michael Schneider added that, “Business with automotive customers in particular recovered at the end of the year. Our consistent actions with a focus on protecting our workforce, adapting flexibly to customer needs and strict cost management also had an impact in the fourth quarter.”
Strong cash flow and lower net debt
Net operating cash flow in fiscal year 2020 amounted to 78.3 million euro (2019: 122.9 million euro). Management of cash inflows and liquidity-oriented use of financing instruments, helped in securing financial stability in an environment that continued to be dominated by uncertainty. The Group lowered its net debt for the third quarter in a row. As of the reporting date of December 31, 2020, total financial liabilities amounted to around 338.4 million euro (December 31, 2019: 420.8 million euro).