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KRONES AG — Earnings Release 2013
Oct 24, 2013
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Earnings Release
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Corporate | 24 October 2013 07:28
Krones AG: Krones continues solid, profitable growth trend
Krones AG / Key word(s): Quarter Results
24.10.2013 / 07:28
24 October 2013
Corporate news release
Krones continues solid, profitable growth trend
– Revenue improved 7.1% from EUR1,897.6 million in the year-earlier period to EUR2,032.9 million in the first three quarters of 2013.
– Krones generated an EBT margin of 5.8% in the period from January to September 2013.
– All three segments are on the right track to achieve their targets for 2013.
– Krones confirms its growth and earnings target for 2013 and expects higher revenue and further improved profitability in 2014.
Krones, the world’s market leader for beverage filling and packaging technology, continued to grow profitably in the third quarter of 2013 despite the challenging macroeconomic environment. In the period from July to September, revenue increased 7.8% year-on-year from EUR607.9 million to EUR655.4 million. Sales in the first nine months of 2013 were up 7.1% year-on-year, from EUR1,897.6 million to EUR2,032.9 million. Krones’ growth was especially strong in the North and Central America and South America/Mexico sales regions in the third quarter.
In the period from July to September 2013, new orders were up 12.7% year-over-year, from EUR639.5 million to EUR721.0 million. At EUR2,103.8 million, new orders in the first nine months of 2013 were 6.9% higher than the year-earlier figure of EUR1,967.3 million.
Orders on hand at Krones were up 5.7% at 30 September 2013, from EUR1,012.1 million a year earlier to EUR1,070.2 million. The large orders cushion will enable the company to balance its capacity utilisation in the fourth quarter. It also ensures a good basic level of capacity utilisation for the first quarter of 2014.
Higher revenue and the positive effects of the ‘Value’ strategy programme have also enabled Krones to improve its earnings margins despite continued price pressures. Earnings before taxes (EBT) were up to EUR117.1 million in the first nine months of 2013, from EUR50.4 million in the year-earlier period, which was affected by a one-time expense of EUR40.6 million. The EBT margin – the ratio of EBT to revenue – was 5.8% after the first three quarters (previous year ‘operating’ EBT margin: 4.8%). Net income amounted to EUR81.7 million for the first nine months of 2013 (previous year: EUR36.2 million). That corresponds to earnings per share of EUR2.64 (previous year: EUR1.20).
Krones increased its return on capital employed (ROCE), the ratio of EBIT to average net tied-up capital, to 15.3% in the period from January to September (previous year: 6.7%). The company still
has a very sound financial and capital structure. The company’s equity ratio was 43.5% at the end of the third quarter (31 December 2012: 37.8%). Moreover, the company’s net cash and cash equivalents (cash and cash equivalents less bank debt) amounted to EUR120.4 million at the end of September.
Outlook
The company expects to achieve 4% growth year-on-year and an EBT margin of 5.8% to 6.0% for the year 2013 as a whole Krones’ management is confident that the company will achieve its ROCE target of 15%, in 2013. The company also intends to generate a level of free cash flow in 2013 similar to that of the previous year.
Krones intends to continue to grow profitably in 2014
According to forecasts by leading economic research institutions, momentum is likely to be somewhat stronger in 2014 than it was in 2013, both in the industrialised countries and in the emerging economies.
From today’s perspective, Krones expects consolidated revenue to grow by 4% in 2014. Revenue in our core segment, ‘machines and lines for product filling and decoration’, will increase more steeply compared with 2013. Following the strong growth achieved in 2013, revenue in the ‘process technology’ segment will likely hold steady in the year ahead. For Kosme, the company expects revenue to decline slightly in 2014.
Under the Value strategy programme, Krones aims to increase efficiency along the entire value chain in 2014. Market prices are expected to remain tight. Overall, the company expects to achieve an EBT margin of around 6.2% in 2014. KRONES aims to increase its third strategy target, ROCE, to 16% in 2014.
Krones’ medium-term goals
In the medium term, Krones intends to grow with the market, an average of 4% to 6%, and is targeting an EBT margin of 7%. In order to achieve this goal, the company intends to generate an EBT margin of 8% in the ‘machines and lines for product filling and decoration’ segment in the medium term, 4% in the ‘machines and lines for beverage production/process technology’ segment, and 3% in the ‘machines and lines for the low output range (Kosme)’ segment. The medium-term ROCE target is 20%.
In addition, the company is pleased to announce that Markus Tischer has been appointed to the Executive Board for ‘International Services and Operations’ effective 1 January 2014.
Details on the third quarter of 2013 can be found in the quarterly report, which is available at http://www.krones.com/downloads/Q3_2013_e.pdf
Contact:
Olaf Scholz
Senior Vice President of Investor Relations Krones AG
Phone: +49 9401 70-1169
E-mail: [email protected]
End of Corporate News
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| Language: | English |
| Company: | Krones AG |
| Böhmerwaldstraße 5 | |
| 93073 Neutraubling | |
| Germany | |
| Phone: | +49 (0)9401 701169 |
| Fax: | +49 (0)9401 709 1 1169 |
| E-mail: | [email protected] |
| Internet: | www.krones.com |
| ISIN: | DE0006335003 |
| WKN: | 633500 |
| Indices: | MDAX |
| Listed: | Regulierter Markt in Frankfurt (Prime Standard), München; Freiverkehr in Berlin, Düsseldorf, Hamburg, Stuttgart |
| End of News | DGAP News-Service |
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| 235948 24.10.2013 |