HWA AG WILL NOT ACHIEVE ITS 2020 EBIT TARGET

For the full year, the Company had previously been cautiously optimistic about achieving an EBIT of approximately EUR 5 million. However, this target was dependent on the further development of the pandemic. In addition, a generally stable economic environment during the second half of the year was considered a key prerequisite.

Traditionally, and now further affected by COVID-19, the first six months of the year tend to be weaker for HWA. The Company's business is significantly dependent on a strong second half of the year. After a large portion of business activities in the first half of the year could not take place due to lockdown measures, for example in racing series involving HWA, all business segments experienced a strong recovery during July and August. Catch-up effects were also evident during this period.

However, demand development in September was unusually weak, particularly in the growth segment Vehicles/Vehicle Components. Project business, in particular, is performing below Management’s expectations. In addition, visibility and order intake for the coming weeks remain subdued.

Against this backdrop, the EBIT target for 2020 is no longer achievable. An updated forecast cannot be provided at this time.

Nevertheless, the Company remains committed to improving its earnings compared to 2019, including through the continued use of short-time work arrangements and significant cost-reduction measures.