Krones raises forecast

Recovery surprisingly fast

28-Jul-2021 - Germany

Due to a surprisingly rapid recovery in demand, the filling and packaging line manufacturer Krones is taking a more optimistic view of the current year. In addition, the company is now benefiting from past restructuring measures. Cost pressure from higher prices for materials could thus be cushioned. In addition, the higher costs are to be passed on to the customers via a price increase for all machines in the filling, packaging and process technology sectors, starting in August. According to a statement issued on Friday, the aim is to bring prices back up to pre-crisis levels.

Krones' shares rose sharply on Friday morning. Most recently, the share, which is listed on the small-cap index SDax, was trading around 3.5 per cent higher at just under 86 euros. Krones now aims to achieve sales growth of 7 to 9 per cent in 2021. This is significantly more than the up to 3.5 per cent that the company from Neutraubling in the Upper Palatinate had previously calculated. The profit margin before interest, taxes, depreciation and amortization (Ebitda) is expected to reach 7 to 8 percent, instead of 7.5 percent at best as previously forecast. Demand is expected to remain high in the second half of the year, management said, explaining the forecast increase.

The outlook is subject to there being no serious problems such as supply issues as a result of the Corona pandemic. In the Corona year 2020, group sales had fallen more than 16 percent to 3.32 billion euros. The operating profit margin at 4 per cent.

In the second quarter, Krones increased its sales by around 12 per cent to 845 million euros, compared with the same quarter last year, according to provisional figures. At 61 million euros, the operating profit for the second quarter was just over twice as high as a year ago. The reason Krones gave for the fact that the result turned out so strongly, despite higher costs, was structural measures within the Group.

In the first six months of the year, the management counted orders with a volume of around two billion euros - 40 per cent more than a year ago, they said. Between April and June, even 60 percent more orders would have been received. The board of directors will present the complete figures for the first half of the year on August 3./ngu/lew/mis (dpa)

Note: This article has been translated using a computer system without human intervention. LUMITOS offers these automatic translations to present a wider range of current news. Since this article has been translated with automatic translation, it is possible that it contains errors in vocabulary, syntax or grammar. The original article in German can be found here.

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