STS Group AG's third production facility in Shiyan:
China becoming central pillar of the growth strategy
Hallbergmoos/Shiyan, April 11, 2019. Today marked the commissioning of another major STS Group production facility in China, this time in Shiyan, with an official inauguration ceremony and 120 invited guests. In addition to the Executive Board, Supervisory Board, local management and parts of the new production workforce, the ceremony was also attended by numerous official representatives of the Chinese provincial government and Shiyan's mayor.
This is now the third production location the STS Group - a leading system supplier to the automotive and commercial vehicle industry - has opened in China alongside plants in Qingdao and Jiangyin. In the fourth quarter of 2018, new headquarters were also opened in Wuxi near Shanghai, and the development center was relocated here to create an attractive site for highly qualified skilled workers. STS has four locations in China alone and seventeen worldwide: "China represents a rather essential part of our company and our growth. The opening of this new plant in Shiyan makes clear our intention to implement the full scope of our innovations, products and capabilities in China going forward," explained Andreas Becker, CEO of STS Group AG, in his speech during the opening ceremony.
The company has high hopes for its investments in China. "We are confident that our technology, production expertise and fantastic products combined with the physical proximity to Chinese OEMs will enable us to significantly expand our market share in China in the future," said Becker. As things stand, the STS Group already supplies products to seven of the ten largest Chinese commercial vehicle OEMs and it intends to significantly expand its position over the next few years. It has also gained a first substantial order to supply a battery cover for an electric vehicle as a tier 1 supplier. This is an example of the development opportunities that exist with new technologies. The order was acquired back at the end of 2018.
Following on from a construction time of just six months from June to December 2018, the new production facility began to produce its first components in the first quarter of 2019. "The speed at which we were able to build such an amazing plant here in China equipped with production equipment and machinery that are state of the art is astounding. We would like to thank everyone involved in the project, the city and our partners," said Andreas Becker during the inauguration ceremony. The new production facility in Shiyan currently has 58 employees, and there are plans to further expand capacity and create more jobs at the new plant in the future.
The company is currently focusing its efforts on the product range of its Plastics segment, initially concentrating on the lightweight and flexible sheet molding compound (SMC) and on injection molded components. The goal is to offer injection molded components in China in the near future in order to position itself more strongly as a supplier of complete product systems on the Chinese market and thus gain a further competitive advantage. The plant also has a painting line. There are currently around 600 people overall employed at STS locations throughout China. This puts the STS Group in an optimum position to continue to expand its presence as a leading system supplier on the world's largest truck market and to cater to the mega trend of electric mobility in China.
The opportunities that STS sees in China and the country's / market's importance within the Group's network were reinforced by the company's decision to establish "China" as an independent segment in the 2018 financial year. In China, the STS Group achieved growth in the reporting year by increasing its own market share. Revenue almost doubled to 48.6 mEUR (prior year: 25.3 mEUR). In the current year, the focus is geared towards further expanding the Group's business in China.
Overall, STS Group AG achieved consolidated revenue of 401.2 mEUR in the 2018 financial year after 310.0 mEUR in the prior year. This equates to growth of around 29%, essentially stemming from acquisitions carried out in the 2017 financial year and the associated expansion of business. Adjusted EBITDA rose by approximately 67% in the reporting year to 23.7 mEUR (prior year: 14.2 mEUR).
About STS Group:
STS Group AG, www.sts.group(ISIN: DE000A1TNU68), is a leading system supplier for the automotive industry in the soft and hard trim sector. The Group, with its tradition and expertise dating back to 1934, has more than 2,500 employees around the world and generated revenue of over 400 mEUR in financial year 2018. At its 17 plants in total in France, Italy, Germany, Poland, Mexico, Brazil and China, the STS Group produces plastic and acoustic components, such as solid and flexible vehicle trim, noise and vibration-damping materials and entire interior and exterior trim systems. STS is considered a technology leader in the manufacture of plastic injection molding, specialty acoustic products and components from sheet molding compounds (SMC). STS has a strong footprint with plants in China, Europe, Mexico and Brazil. The customer portfolio comprises leading international commercial vehicle and automotive manufacturers.
STS Group AG
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