26.04.2018
Krones AG DE0006335003
DGAP-News: Krones AG: Krones had a good start to 2018 with a strong first quarter
DGAP-News: Krones AG / Key word(s): Quarter Results
Krones AG: Krones had a good start to 2018 with a strong first quarter
26.04.2018 / 08:00
The issuer is solely responsible for the content of this announcement.
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Corporate news release
26 April 2018
Krones had a good start to 2018 with a strong first quarter
- At EUR891.7 million, revenue was down 0.9% from the prior-year figure,
which had been quite high due to timing.
- Order intake rose 13.4% to EUR992.4 million. Acquisitions had no
significant impact on revenue or order intake in the first quarter of 2018.
- Earnings before taxes decreased 14.8% to EUR56.2 million partly due to a
one-time effect within personnel expenses. The EBT margin decreased from
7.3% to 6.3%.
- Executive Board confirms targets for 2018. Krones expects 6% revenue
growth and a reported EBT margin of 7.0%.
Business at Krones, the world's leading manufacturer of filling and
packaging technology, developed well in the first quarter of 2018. The
company benefited from its broad international diversification and its
entire portfolio of products and services as well as a generally favourable
macroeconomic environment. In the period from January to March 2018, revenue
was down slightly, by 0.9%, year-on-year from EUR899.4 million to EUR891.7
million. However, it should be kept in mind that the prior-year figure
included a positive effect from timing. Krones was able to invoice around
EUR60 million in projects in the first quarter of 2017 that had not been
expected to generate revenue until the second quarter. Furthermore it should
be noted that the last quarter of 2017 had a relatively high revenue level
too. In all, Krones is on track to achieve the 6% revenue growth forecast
for the year 2018. Order intake supports this assertion as it was up 13.4%
year-on-year in the first quarter of 2018 to EUR992.4 million. At the end of
March 2018, Krones had orders on hand totalling EUR1,340.8 million. That is
up 19.6% year-on-year. Acquisitions had no significant impact on revenue or
order intake in the first quarter of 2018.
Profitability was down temporarily
Despite successful measures to increase efficiency within the company,
Krones' earnings were down year-on-year in the first quarter of 2018. One
factor causing the decrease was a temporary increase in personnel expenses.
That increase resulted because the company had to recognise higher
provisions for the entire year 2018 due to a pay agreement made in the
reporting period. Earnings before taxes (EBT) decreased 14.8% to EUR56.2
million. The EBT margin was down from 7.3% in the previous year to 6.3% in
the first quarter of 2018. The high prior-year figure had been influenced
positively by the high revenue in the first quarter of 2017. At EUR38.7
million, consolidated net income was down 11.4% year-on-year in the
reporting period. Earnings per share came to EUR1.23 in the first quarter of
2018 (previous year: EUR1.40).
Krones' free cash flow improved considerably, from -EUR112.8 million in the
prior year to
-EUR14.1 million in the first three months of 2018. The ratio of average
working capital for the past four quarters to revenue increased to 28.2%
(previous year: 26.8%). Krones' return on capital employed (ROCE), the ratio
of EBIT to average net capital employed, decreased from 17.8% in the
previous year to 15.3%, mostly due to lower earnings.
Krones announces price increases and confirms forecast for 2018
Selling prices in Krones' markets have been flat for several years now.
Krones is raising its prices on all machines for bottling and packaging
equipment and for process technology by 4.5% on average effective 1 May 2018
and is adjusting its payment terms.
The company invests continually in developing and evolving its portfolio of
products to generate real added value for customers with its machines,
lines, and services. To ensure Krones' continued ability to offer the
highest quality, innovative products and services despite rising costs for
goods and services purchased and personnel, the company must raise its own
prices. Krones will also continue to invest in existing cost-reduction
initiatives launched as part of its Value strategy programme, such as
expanding its global footprint. Krones intends to maintain its market
position as a provider of solutions for food and beverage production within
the bottling and packaging industry.
Because the price adjustments are aimed at offsetting current cost
increases, Krones is keeping its revenue and earnings forecast for 2018 and
for the medium term unchanged. Based on the current macroeconomic prospects
and expected development of the markets relevant to Krones, the company is
targeting consolidated revenue growth of 6% in 2018. Krones intends to keep
profitability stable despite heavy investment in digitalisation and start-up
costs associated with its global footprint, particularly the new site in
Hungary. The company expects to post an EBT margin of 7.0% in 2018. Krones
intends to improve its third financial performance target, working capital
to revenue, to 26%.
Krones has published the complete Quarterly Statement online at
https://www.krones.com/en/company/investors.php
Key figures Q1 2018 1 Jan - 1 Jan - Change
31 Mar 31 Mar
2018 2017
Revenue EUR 891.7 899.4 -0.9%
mill-
ion
Order intake EUR 992.4 875.5 +13.4%
mill-
ion
Orders on hand at 31 March EUR 1,340.8 1,120.8 +19.6%
mill-
ion
EBITDA EUR 78.9 87.2 -9.5%
mill-
ion
EBIT EUR 55.5 64.0 -13.3%
mill-
ion
EBT EUR 56.2 66.0 -14.8%
mill-
ion
EBT margin % 6.3 7.3 -1.0
PP*
Consolidated net income EUR 38.7 43.7 -11.4%
mill-
ion
Earnings per share EUR 1.23 1.40 -12.1%
Capital expenditure for PP&E and EUR 27.4 19.6 +EUR7.-
intangible assets mill- 8
ion millio-
n
Free cash flow EUR -14.1 -112.8 +EUR98-
mill- .7
ion millio-
n
Net cash and cash equivalents at 31 EUR 143.8 256.1 -EUR11-
March** mill- 2.3mil-
ion lion
Working capital to revenue*** % 28.2 26.8 +1.4
PP*
ROCE % 15.3 17.8 -2.5
PP*
Employees at 31 March
Worldwide 15,461 14,660 +801
Germany 10,394 10,124 +270
Outside Germany 5,067 4,536 +531
* PP = percentage points ** Cash and
cash equivalents less debt *** Average
of last 4 quarters
Contact:
Olaf Scholz
Head of Investor Relations, Krones AG
Phone: +49 9401 70-1169
E-mail: [email protected]
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26.04.2018 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.
The DGAP Distribution Services include Regulatory Announcements,
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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: Regulated Market in Frankfurt (Prime Standard), Munich;
Regulated Unofficial Market in Berlin, Dusseldorf,
Hamburg, Hanover, Stuttgart, Tradegate Exchange
End of News DGAP News Service
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679359 26.04.2018
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