After Divesting PIA Group, Preh Continues to Grow

NOVI, Mich. - May 30, 2018 - PRLog -- With a 2017 revenue increase of 9.1 percent (€1.28 billion/$1.48 billion USD) over 2016 (€1.18 billion/$1.36 billion USD), Preh revenue continued to grow even after divesting itself of the PIA Group automation  business on July 1, 2017.  Excluding PIA, comparable growth was 14.7 percent.

Earnings before interest and taxes (EBIT) in 2017 were significantly above the previous year's level of €90.6 million/$104 million USD), but a direct comparison has not been made because of the effect of the sale of the Automation Division. From an operating perspective, EBIT did not quite reach the 2016 level, primarily because of high investment in development capability, e.g., in the future market of e-mobility.

Preh, which belongs to the Chinese Joyson Group, has also invested heavily in further workforce development. By the end of 2017, the number of Preh employees increased by 10.5 percent to approximately 6,560, compared to 5,930 employees in the automotive business in 2016. At the German headquarters in Bad Neustadt, many new jobs were also created, with the number of Preh staff growing to around 1,710 automotive employees, corresponding to an increase of 12.7% compared to the previous year's 1,520.

Despite the high competitive and cost pressures in the automotive industry, Preh's management continues to see the company on a stable growth path. In the first quarter of the current financial year, sales revenues at the Preh Group reached a single-digit growth above the comparable figure for the previous year. Due to the good overall situation with orders, Preh's management expects the growth course to continue for the full year as well.

Christoph Hummel, Preh President and CEO, said: "In 2017, we set up our Automation Division completely independent within the Joyson Group. Preh is now strictly an automotive supplier, while our colleagues at PIA can now adjust fully to their market requirements. Overall, 2017 was a successful year for Preh—shaped above all by our high investments in our new development center and our state-of-the-art e-mobility lab. At the same time, we also invested heavily in the further development of our automotive team—both at headquarters in Bad Neustadt and worldwide."

The production capacities in Mexico and Romania, for example, have been further expanded. Hummel nevertheless warned against resting on our laurels, on what Preh had already achieved, pointing out that competitive pressures continued to be extremely high in the industry and required consistent budget and cost discipline throughout the company.

China business develops with high dynamic growth
Preh's business is developing very successfully in China, the largest automotive market in the world. Preh started to build production capacity in China in 2011, the year Joyson took over. While sales in 2011 were still below €2 million/$2.31 USD, the company generated sales of around €155 million/$179 USD in 2017.

"In China, we started first with German and U.S. customers or their Chinese joint ventures," said Hummel. "In the meantime, we have also achieved our first sales successes with Chinese car manufacturers." Preh still has great growth potential which the supplier wants to realize in the coming years.

New mission statement for the substantially larger Preh Group
Due to the successful partnership with the investor Joyson, the Preh Group has developed very dynamically and changed a great deal not only in China, but also worldwide.

From a thoroughly medium-sized enterprise with limited markets in Europe and North America with 2007 sales of around €320 million/$369 million USD and 2,200 employees, a global player has emerged with almost  €1.3 billion/$1.5 billion USD in revenues and around 6,500 employees by the 2017 reporting year. The company's product portfolio has also increased significantly thanks to Preh Car Connect.

"This results primarily in new opportunities, but at the same time our corporate culture and our external image have to do justice to the extended product range and the changed workforce structure," said Hummel with conviction.

The Preh group's much greater size needed a common mission statement that applied both to Preh's growing history and the new "members of the family."  The management of Preh GmbH and Preh Car Connect GmbH, together with the heads of the personnel and marketing departments in the respective workshops, therefore assessed the current state of affairs at the newly established Preh Group and developed a new vision for the entire company. The result is a new mission statement summed up by the slogan "We drive Innovation!"

"Our new vision sets the direction for the future," said Hummel. "We aspire to be an innovation driver in designing the vehicle interior of tomorrow and the mobility of the future. But to do that, we need to work even more closely together and exploit the potential of Preh and PCC in the best possible way."

In order to convey the new mission statement approach and further improve internal communication, Preh will, among other innovations, launch a new intranet that also includes an app for mobile phones in the second half of 2018.

"We want to reach all employees – whether they are employed in Bad Neustadt, Novi or Ningbo – regardless of whether they have a PC workstation or work in production," Hummel concluded.

About Preh
As a global automotive supplier, the Preh Group currently employs around 7,000 people and generates sales of around €1.3 billion/$1.5 billion USD. Preh was founded in Bad Neustadt a. d. Saale in 1919 and has been part of the Joyson Group since 2011. Preh's development and manufacturing capabilities include, in particular, HMI systems for passenger cars and commercial vehicles, infotainment, and connectivity solutions, as well as e-mobility control units. For more information, please visit http://www.preh.com.

Within the Joyson group of companies, Ningbo (China), founded by Jeff Wang in 2004, Preh is a subsidiary of the listed Joyson Electronics Corp. (600699: Shanghai) and forms the Automotive Electronics Division. Today, Joyson is one of the 30 largest automotive suppliers in the world.