Italian premium brake maker Brembo said on Thursday that higher production costs and global chip shortages affected core earnings and margins in the fourth quarter.
see photosThe Brembo logo is seen at its headquarters in Bergamo, Italy
(Reuters) – Italian premium brake maker Brembo said on Thursday that higher production costs and global chip shortages affected core earnings and margins in the fourth quarter, while the crisis in Ukraine made it impossible to issue forecasts for the coming months. Brembo executive chairman Matteo Tiraboschi told Reuters that the company had a positive start to 2022, with “strong” performance in January and February. But he said the Russian invasion of Ukraine was putting a “big question mark” on the trade outlook.
“Should the current geopolitical crisis last for weeks or worse, months, that will be a huge problem,” he said.
The company, with operations in 15 countries, including Russia, said in a statement that the direct impact of the Russia-Ukraine crisis on the group was limited as it has no production sites in the region, but was nonetheless closely monitoring the impact on commodity supplies. was doing. and production cost. Brembo, which makes brakes for several Formula One and MotoGP teams as well as premium carmakers such as Tesla and Ferrari, said earnings before interest, taxes, depreciation and amortization (EBITDA) were $121 million in October-December. Euro ($134.14 million). Period, its profit margin fell from 18.7% to 16.4%.
Tiraboschi said raw material prices and energy and logistics costs had risen particularly in the last part of 2021, and that Brembo’s indexed contracts were providing protection with only three to six months lag. “We are in a position to chase and that has affected our margins,” he added.
Tiraboschi said the high-end segment of the automotive market, where Brembo is focused, was also affected by the global semiconductor shortage in the fourth quarter, as it was spared in the back half of the year.
Brembo shares fell 6.5% to their lowest price since November 2020 following the release of their results. By 1535 GMT they were down 2.3%. Fourth quarter sales increased 13.4% to EUR 735.8 million, driven by growth across all markets.
($1 = 0.9020 Euro)
(Reporting by Agnes Straquadanio and Giulio Piovacari; Editing by Paul Simao)
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