In particular, the business with rechargeable lithium-ion button cells, which has grown so rapidly in recent years, was again disappointing. It had already failed in the first half of the year, now the weaker trend has accelerated. Varta said on Thursday in Ellwangen that new customer projects with the cells started delayed. The group had already lowered its sales forecast last week due to the weakness in the division.
Nevertheless, the details of the interim report for the first nine months displeased investors, as one trader said. After three days of stabilization, the share now temporarily loses 1.46 percent to 114.55 euros on XETRA. The high from August at almost 166 euros remains a long way off – not to mention the annual high of over 181 euros at the end of January, when stock market speculation drove the price to record highs for a short time. The forecast cut last week had even caused the share to fall below 100 euros. The significant increase in the share price has long since passed: the share is currently below the level of the end of 2019. In that year, Varta was the shooting star on the stock exchange and the strongest MDAX stock.
Investors have been worried for a long time that Varta could have major problems with cheap competition, especially in the area of button cells. Last year, Varta signed a new supply agreement with the Korean electronics giant Samsung after a previous dispute over patents. That initially calmed the investors. Apple is also a major customer of Varta. The button cells are used in expensive wireless headphones, which have been booming for some time, but also in hearing aids.
The first nine months presented an unusual picture for Varta – the total turnover fell. Because of the weakness in lithium-ion cells and micro batteries, the total revenue fell by 1.3 percent to 622.3 million euros. In the button cell division, the decline accelerated – while after six months it was still a minus of 2.7 percent, it was now 5.9 percent after nine months. In terms of figures, that means a drop in sales of a good 11 percent in the third quarter alone. New projects with
Customers for small-format lithium-ion cells are being planned, the company said. The household battery segment is developing very positively.
CEO Herbert Schein had lowered the group sales forecast for 2021 from 940 million euros to 900 million euros at the beginning of November. In Ellwangen, too, sales growth of around 100 million euros each is calculated for the next two years. According to the management, the profitability is still good. At the end of this year, it should be around 30 percent margin on adjusted earnings before interest, taxes, depreciation and amortization, according to the consolidated financial statements, around 275 million euros in absolute terms.
In the first nine months, the adjusted operating result grew by 3.2 percent across the group to 182.5 million euros thanks to the good margin development in the two divisions. In terms of the net profit attributable to the shareholders, higher depreciation and interest charges resulted in a decrease of 3 percent to 75.8 million euros.
In the coming years, Varta will invest heavily in setting up a battery cell production facility for electric cars. The batteries of high-performance premium cars are to be equipped with the specially developed cell; Varta says it has already won its first customer. Pilot production is scheduled to start at the end of this year, with mass production two years later. The first sales are factored in from 2024. An annual production capacity of at least 2 gigawatt hours is planned. Varta intends to provide details on the project in the coming spring.
/ men / eas
ELLWANGEN (dpa-AFX)
More news about Varta AG
Image Sources: 360b / Shutterstock.com, Mirco Vacca / Shutterstock.com