German car-part supplier, Grammer, experienced a sharp decline in its shares after issuing a warning that it would fall short of its operating earnings guidance for the year.
Grammer attributed the lower earnings to several factors, including volatile plant capacity utilization, currency losses, and a notable increase in personnel costs during the fourth quarter. As a result, at 1200 GMT, Grammer shares were trading 9.9% lower at EUR10.00.
Despite the setback, the company emphasized that its final operating EBIT result would still surpass last year's figure of EUR35.5 million, albeit it would not reach the earlier forecast of approximately 70 million euros ($76.3 million).
However, due to negotiations with customers regarding compensation to offset inflation-related cost increases that are still pending, Grammer did not provide a new forecast for the full year 2023 at this time.
While operating EBIT in the fourth quarter has fallen significantly below the EUR33.6 million reported in the previous year, Grammer remains confident in meeting its revenue guidance of around EUR2.2 billion for the year.