12.05.2016
Wacker Neuson SE DE000WACK012
DGAP-News: Wacker Neuson SE: Wacker Neuson Group confident for 2016 - despite a difficult start to the year
DGAP-News: Wacker Neuson SE / Key word(s): Quarterly / Interim Statement
Wacker Neuson SE: Wacker Neuson Group confident for 2016 - despite a
difficult start to the year
12.05.2016 / 07:59
The issuer is solely responsible for the content of this announcement.
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Wacker Neuson Group confident for 2016 - despite a difficult start to the
year
(Munich, May 12, 2016) During the first quarter of 2016, international
light and compact equipment manufacturer Wacker Neuson continued to feel
the impact of difficult conditions across many of its markets, in
particular in the Americas region. Although the Group managed to maintain
revenue at almost the same level as the record-breaking prior-year quarter,
it reported lower profit figures for the period. The world's largest
construction equipment trade show, bauma, which was held in Munich in
April, proved a great success for the Group. Company management has
confirmed its forecast for fiscal 2016.
Revenue at almost the same record-breaking level as the previous year
Group revenue for the first quarter of 2016 amounted to EUR 316.4 million.
This is just 2 percent below the record revenue reported for the prior-year
period (Q1/15: EUR 324.3 million). Adjusted to discount currency effects,
this corresponds to a drop of just 1 percent.
Key markets remained in a state of crisis, as Cem Peksaglam, CEO of Wacker
Neuson SE, explains: "In North America, the ongoing slump in demand in the
raw materials and energy sectors negatively impacted our business,
particularly in the worksite technology field. South America, and Brazil in
particular, continues to be hit by political and economic uncertainties and
shows no signs of picking up. By contrast, demand was high in the
construction sector in central and northern Europe, and southern European
countries improved on the previous year's performance. However, as
expected, trade in compact equipment for the agricultural sector remained
below the prior-year level. This is due to extremely low prices for
foodstuffs, above all milk."
At 72 percent, Europe accounts for a very large share of Group revenue.
Revenue for this region was 2 percent down on the previous year. Here, the
Group was able to almost fully compensate for the downturn it experienced
in demand for agricultural equipment. Revenue for the first quarter in the
Americas region fell 15 percent, primarily due to the crisis in the oil and
gas sector. Delays in the production of compact equipment in the US further
impacted revenue for this region. In addition, the dollar's relatively
strong rating had a dampening effect on the export of products manufactured
at the Group's North American plants.
By contrast, the Group reported strong growth in the Asia-Pacific region,
where revenue almost doubled. "Our business in Asia developed very
positively, even allowing for the favorable effect of one-off items on
first-quarter revenue growth and we expect these to balance out over the
course of the year. Whereas demand for large machines is contracting
overall in China, the market for our compact machinery is on a clear growth
path," continues Peksaglam. The Australian economy, which is highly
dependent on raw material prices, continued to suffer from the crisis in
the mining industry. Overall, the whole region increased its share of total
Group revenue by 2.7 percentage points relative to the previous year to
reach 5.5 percent.
Trends in the business segments
At 51 percent, the compact equipment segment accounts for the largest share
of Group revenue. Revenue for this segment was almost at the same high
level as the previous year. By contrast, revenue for the light equipment
segment contracted by 8 percent due to the downturn in the oil and gas
sector as well as ongoing crises in some emerging markets. This segment
accounted for 29 percent of Group revenue in the first quarter. Revenue for
the services segment, which covers the Group's repair and spare parts
business, increased 2 percent compared to the prior-year quarter. The
segment thus accounted for 20 percent of revenue.
Changes in the regional and product mix had a negative impact on profit
Profit before interest and tax (EBIT) in the first quarter of 2016 fell 45
percent relative to the prior-year period to reach EUR 17.3 million. As a
result, the EBIT margin dropped to 5.5 percent (Q1/15: EUR 31.7 million;
9.8 percent). Profit for the period amounted to EUR 11.1 million (Q1/15:
EUR 21.3 million). Earnings per share are reported at EUR 0.16 (Q1/15: EUR
0.30). This drop in earnings can be largely attributed to distressed
markets. "Despite the difficult market conditions, we managed to keep
revenue at almost the same high level as the previous year. During the
first quarter, however, our regional and product mix was significantly less
favorable, which squeezed our earnings. At the same time, currency
movements clearly tilted to the downside and this had a substantial impact
not only on revenue but also on profit. We are countering this with cost
control measures as well as our ongoing efforts to optimize processes and
leverage synergies across the Group," elaborates Peksaglam. The
introduction and implementation of new emissions regulations for diesel
engines has also driven costs up.
Working capital lowered
At EUR -6.1 million, cash flow from operating activities was clearly up on
the prior-year quarter (Q1/15: EUR -20.6 million). This is mainly due to
the Group's targeted efforts to reduce inventories. Discounting investments
in working capital, cash flow from operating activities amounted to EUR
29.7 million (Q1/15: EUR 38.1 million). Free cash flow came to EUR -35.8
million (Q1/15: EUR -45.9 million). The company expects cash flow for the
year as a whole to be positive.
bauma 2016 a resounding success for the Group
The Group unveiled a number of new product innovations to customers at
bauma in Munich in April of this year, all of which were extremely well
received. The new Kramer 5055e electric wheel loader - the first fully
electric all-wheel drive wheel loader - won the "bauma Innovation Award" in
the Machinery category. Wacker Neuson was also awarded the Euro Test Award
by Berufsgenossenschaft Bau (the statutory accident insurance and
prevention association for the German construction industry) for its
battery-powered rammers. The jury was particularly impressed with the
rammers' outstanding contribution to health and safety.
Growth forecast for 2016 confirmed
"The current order situation, a positive business trend in Europe,
infrastructure programs in Germany, plus the positive mood evident among
many national and international customers at the bauma trade show indicate
that business over the rest of the year, in particular the second half of
the year, could compensate for a weak start in the first quarter," adds
Peksaglam.
The Group still expects 2016 revenue of between EUR 1.40 and 1.45 billion,
which corresponds to an increase of between 2 and 5 percent relative to the
previous year. The EBIT margin should still range between 7.0 and 8.0
percent (2015: 7.5 percent). The Group has earmarked around EUR 100 million
in total for investments for fiscal 2016 (2015: EUR 118 million). The
Executive Board and the Supervisory Board will propose a dividend in the
amount of EUR 0.50 per share at the upcoming Annual General Meeting to be
held in Munich on May 31, 2016 (2015: EUR 0.50).
The quarterly report is available online at
http://wackerneusongroup.com/en/investor-relations/financial-reports-
presentations/2016/
Table: Revenue and earnings
Figures in EUR Million_Q1/16_Q1/15_Change
Revenue_316.4_324.3_-2.4%
EBIT_17.3_31.7_-45.4%
EBIT margin as a %_5.5_9.8_-4.3 PP
Total profit/loss for the period (after minority
interests)_11.1_21.3_-47.9%
Earnings per share (EPS)_0.16_0.30_-47.9%
Your contact partner:
Wacker Neuson SE
Katrin Yvonne Neuffer
Head of Corporate Communication /
Investor Relations
Preussenstrasse 41
80809 Munich, Germany
Tel. +49-(0)89-35402-173
[email protected]
www.wackerneusongroup.com
The Wacker Neuson Group is an international family of companies and a
leading manufacturer of light and compact equipment with over 50 affiliates
and 140 sales and service stations. The Group offers its customers a broad
portfolio of products, a wide range of services and an efficient spare
parts service. The product brands Wacker Neuson, Kramer and Weidemann
belong to the Wacker Neuson Group. Wacker Neuson is the partner of choice
among professional users in construction, gardening, landscaping and
agriculture, as well as among municipal bodies and companies in industries
such as recycling, energy and rail transport. In 2015, the Group achieved
revenue of EUR 1.38 billion, employing over 4,600 people worldwide.
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12.05.2016 Dissemination of a Corporate News, transmitted by DGAP - a
service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.
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Language: English
Company: Wacker Neuson SE
Preußenstr. 41
80809 München
Germany
Phone: +49 - (0)89 - 354 02 - 0
Fax: +49 - (0)89 - 354 02 - 390
E-mail: [email protected]
Internet: www.wackerneusongroup.com
ISIN: DE000WACK012
WKN: WACK01
Indices: SDAX
Listed: Regulated Market in Frankfurt (Prime Standard); Regulated
Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover,
Munich, Stuttgart
End of News DGAP News Service
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