By Sarah Sloat
German automotive supplier Continental AG (CON.XE) said Monday that its earnings fell in the fourth quarter, and it forecast profitability would decline in the current year.
"As feared, the decline of the automotive markets intensified significantly once again in the fourth quarter," said Chief Executive Elmar Degenhart. "This, combined with the profound changes in our industries, is reducing our growth rate."
The company's adjusted operating result in the quarter declined to around 1.1 billion euros ($1.26 billion) from EUR1.31 billion a year earlier, resulting in a margin on adjusted sales of about 9.7%, compared with 11.7% previously. Fourth-quarter sales were EUR11.25 billion, down slightly from EUR11.28 billion.
In the full year, adjusted operating profit fell to EUR4.1 billion from EUR4.75 billion, resulting in a margin of 9.2% compared with 10.8% in 2017. Full-year sales rose slightly to EUR44.4 billion.
For 2019, Continental sees an adjusted EBIT margin of 8% to 9% and sales between EUR45 billion to EUR47 billion.
The fourth quarter was helped in part by strong sales of winter tires and the positive development in the nonautomotive industrial business, Continental said.
The company releases full results on March 7.
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