Automotive supplier SGL shares drop a third as chief quits on profit warning
SGL Carbon, a major supplier to Germany’s car industry, has suffered a double blow as its chief executive threw in the towel over flawed business planning on the same day as a profit warning.
Chief executive Juergen Koehler will step down at the end of August, he announced, as the company said it expected adjusted operating profit to be about €10m (£9.2m) lower than last year’s €65m. The firm did not name a successor.
Read more: German economy shrinks in second quarter as exports slump
SGL was founded in 1992 and is one of the world’s foremost suppliers of carbon fibre for use in car parts and wind turbines. Volkswagen and BMW hold stakes in the company, whose shares trades on the German stock exchange. Its share price fell by a third today.
The company warned profit this year would fall short of a forecast it issued just last week, and withdrew its forecasts for the next three years. It said forecasts for the 2020-2022 period had become obsolete and it was considering a restructure.
A spokesman said a large order for rotor-blade materials from a wind energy company had cost far more than expected. This was a major factor for the bleaker outlook, he said.
Read more: German factory production slumps in June raising recession fears
Susanne Klatten, a 28 per cent shareholder and head of SGL’s non-executive supervisory board said she had “complete respect and understanding” for Koehler’s decision.
Germany’s economy, the largest in Europe, shrank in the second quarter of the year as weak global demand caused exports from the former powerhouse of Europe to drop off. It has struggled under the weight of trade tensions, weak demand from China, Brexit and a global slowdown.
Main image: Getty