Krones successfully tackles the ongoing component shortage
Business at the filling and packaging equipment manufacturer Krones continued to run smoothly in the third quarter. Conditions remained challenging due to a shortage of electronic components, according to a statement issued by the group on Friday. However, despite the gloomy overall economic outlook, international customers from the food and beverage industry remained highly willing to invest. At the same time, Krones was able to increase its profitability thanks to price increases. The management has now confirmed its targets for the year.
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The figures were well received on the stock market. Krones shares rose by around three percent in the early morning, making them one of the favorites in the index of smaller stocks, SDax.
In an initial reaction, analyst Peter Rothenaicher from Baader Bank described the results of the manufacturer of beverage bottling lines as "very solid". He emphasized the double-digit percentage sales growth - despite the vacation season and the continued lack of electronic components.
The industry expert also praised the operating profit margin and, above all, the "still high order intake", which rose by four percent in the third quarter compared to the second quarter of the year to a good 1.3 billion euros. However, compared to the exceptionally strong previous year's figure of 1.5 billion euros, orders are clearly lagging behind.
Krones could hardly save itself from demand, especially last year. As a result, the order books have now swelled massively. As of the end of September, the Group was sitting on an order intake of just under 4.1 billion euros. "The comfortable cushion of orders ensures that production capacities in the lines and project business will be fully utilized until 2025," the Group continued in the press release.
Krones has so far successfully countered the ongoing bottleneck in electronic components by improving efficiency and implementing flexible processes. The company is also countering rising costs for materials and personnel with price increases. In the reporting period from July to September, turnover rose by ten percent year-on-year to almost 1.2 billion euros.
Earnings before interest, taxes, depreciation and amortization (EBITDA) climbed even more strongly by around 17% to just under 111 million euros, improving the corresponding margin to 9.5% (previous year: 9.0%). Turnover and operating profit were thus in line with the expectations of analysts surveyed by Bloomberg.
At the bottom line, profit rose by a good fifth to 54.3 million euros.
The management around CEO Christoph Klenk had already raised its sales forecast in July due to the good run, which has now been confirmed. Accordingly, Krones aims to generate 11 to 13 percent more revenue this year than in 2022, when revenue had risen to around 4.2 billion euros. The operating margin (EBITDA) is expected to improve from the previous 8.9 percent to 9 to 10 percent./tav/ngu/stk (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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