* EBIT margin sinks to 2 pct in 2012 vs 5.2 pct yr-earlier
* Photovoltaic business now valued at zero in its books
* Does not expect to meet 8 pct EBIT margin goal in 2013 (Adds details, background, CEO comments)
STUTTGART, Germany, Jan 23 (Reuters) - German conglomerate Robert Bosch said it would not reach its long-term profit target this year once again, after it booked heavy losses at its solar energy business in 2012.
Earnings before interest and tax (EBIT) fell to around 2 percent of revenue last year from 5.2 percent in the previous one, due mainly to a 1 billion euro loss in its troubled photovoltaic operations.
“All conceivable solutions for the strategic realignment of the photovoltaics business are currently being weighed in order to arrive at a reasonable solution,” the company said.
The industrial group now values its photovoltaic business at zero in its accounts, having written off the assets entirely last year.
Chief Executive Volkmar Denner told reporters late on Tuesday that Bosch would take urgent steps to lower fixed costs, since it did not expect this year to meet the 8 percent EBIT margin target it believes is necessary to secure the financial independence of the unlisted company.
Best known for the auto parts business that makes everything from advanced electronic brakes to fuel injection systems, Bosch forecast that group revenue growth would improve somewhat this year over the 2012 rate of 1.6 percent.
“Despite slightly increased sales and positive free cash flow, we cannot be satisfied with developments in 2012,” Denner said in a statement, adding that fixed budget limits would be introduced for capital expenditure, acquisitions and other investments.
The steps are somewhat unusual due to its unique corporate culture. Bosch is widely admired in Germany for eschewing short-term measures to boost profit such as job cuts, preferring continuity in its strategy and management team. Last July, Denner became only the seventh chief executive to run Bosch since the company was founded in 1886.
Bosch is controlled by a trust called the “Industrietreuhand KG”, so has no shareholders to please.
Bosch, which competes with Denso for the title of world’s largest auto parts supplier, last year sold its 5 percent stake in the Japanese rival for roughly 1.1 billion euros. (Reporting by Hendrik Sackmann Writing by Christiaan Hetzner; Editing by Helen Massy-Beresford)