Sustained profitable operation at Rába

PRESS RELEASE

RÁBA Plc. closed the first nine months of the year with consolidated group level sales of more than HUF 33 billion, increasing its turnover by 19.7 percent. Despite the continuing rise in commodity prices together with the continuing epidemic situation and disruptions in global supply chains, the company posted a profitable three-quarter year.

Demand in the heavy truck segments in Europe and overseas, which are Rába’s key markets, has been very strong so far this year, and the sales of the company’s agricultural products were also outstanding. Conditions in the Russian bus and truck markets were similarly favourable, while supply chain problems have already worsened sales figures in the European passenger car segment in Q3. The tight capacity associated with high demand activity has led to rising purchase prices in addition to uncertainty in supply. Energy prices are at their highest level in a decade, with steel raw material prices reaching record highs during the period under review, surpassing the highest levels since the 2008 economic crisis. Rába is able to pass on the cost increase to most of its partners with a time lag of a quarter year, while in the case of products with a more complete production and a longer-term fixed order the time lag is half a year.

All three business units contributed to the operating profit of Rába with positive results. In 2021 Q1-Q3 the group level operating profit reached HUF 1.4 billion, of which the sale of real estate in the first half of the year represented HUF 815 million. EBITDA-level efficiency reached 9.7 percent in the first nine months, and EBITDA earnings exceeded HUF 3.2 billion.

Despite the challenges of the COVID-19 epidemic period and the subsequent recovery phase, the financial position of the Rába Group is characterized by a stable liquidity position. The level of net loans decreased by HUF 549 million compared to the base period. In contrast to the same period of the previous year, the shareholders’ equity increased by 10.7 percent.

”Our company posted a profitable three-quarter year even under the current difficult economic conditions. Market processes, price increases and supply chain disruptions generated by the continuing epidemic threat posed a serious challenge to companies in the industry, including Rába. The key to our success is that in addition to increasing the flexibility of our manufacturing operations, we have implemented strict cost management. Our company continues to work on improving the efficiency of manufacturing and technology. Our main goal is to be able to neutralize the negative effects as soon as possible after the stabilization of world market purchase prices by passing on the cost increases in our sales prices.”  – said Béla Hetzmann, Chairman-CEO of Rába Automotive Holding Plc.