Wacker Neuson Profitable in Second Quarter
Wacker Neuson is seeing green after a successful and profitable second quarter. According to provisional figures, the company managed as expected to increase Q2 revenue relative to both the first quarter of the current fiscal year and the same quarter last year and post positive earnings once again. In addition, the Wacker Neuson Group reports a healthy revival of order intake. Order backlog for compact equipment at the end of June 2010 was 350 percent higher than the corresponding figure for the same period last year.
Further Increase in Revenue and Earnings in Q2
Although sales in the first quarter were squeezed by a harsh winter in the United States and Europe, demand in the second quarter picked up further as expected and as indicated at the world’s largest construction fair Bauma in April. According to provisional figures, quarterly revenue for the Wacker Neuson Group is expected to reach EUR 205.3 million, up 36.6 percent on the first quarter and 31.2 percent on the same period last year (Q1 2010: EUR 150.3 million; Q2 2009: EUR 156.5 million). These figures reflect the positive trend in the light equipment segment in particular. The forward-looking cost-efficiency measures introduced back at the end of 2008 also contributed — as anticipated — to the results. The provisional Q2 profit before interest, tax, depreciation and amortization (EBITDA) amounts to around EUR 27 million (previous year: EUR 13.4 million). Provisional earnings before interest and tax (EBIT) are posted at around EUR 17.2 million (previous year: EUR 3.2 million) with provisional Q2 profit for the period after tax and minority interests set at around EUR 10.9 million (previous year: EUR 1.4 million). The Wacker Neuson Group was thus able to more than compensate for Q1 losses (posted at EUR 5.7 million) and has returned to profit as planned in the first half year. The company remains on a strong financial footing with an equity quota of 79 percent and a low net financial debt.
Order Backlog Up 350 Percent on Previous Year’s Figure
Accumulated order income for compact equipment — fuelled by the construction and agricultural industries — almost doubled in the first half-year of 2010 relative to the same period last year. By the end of June 2010, order backlog was even 350 percent higher than the figure reported for 2009. This upturn was, however, also accompanied by delivery bottlenecks among certain suppliers and this affected the entire industry. Wacker Neuson assumes that pressure will ease further and products will increasingly be ready for delivery on time.
“Our production facilities for light and compact equipment such as wheel loaders, dumpers and excavators show a healthy level of capacity utilization. In addition, our recent alliance with Caterpillar has the effect of accelerating construction plans for our new production facility in Hörsching, near Linz in Austria,” explained Dr. Georg Sick, CEO of Wacker Neuson SE. Additional reasons for the company to feel optimistic for fiscal 2010 overall is the demand for light equipment that remains strong in Europe, the United States and Asia.
Global Perspective Underpins Future Prospects
Under the umbrella of a strategic alliance recently concluded between Wacker Neuson and Caterpillar Inc., based in Peoria, Ill., both companies have agreed to collaborate over the next 20 years. Starting in 2011, Wacker Neuson will exclusively develop mini excavators up to a total weight of three tons and manufacture these at its plant in Austria. Caterpillar will use these machines to meet worldwide demand for its mini excavators (with the exception of Japan).
“Caterpillar has the world’s strongest distribution network. This strategic alliance allows us to increase production volumes, reduce manufacturing costs and strengthen the competitive positions of both companies in what is a highly fragmented market,” continued Sick. The Group is looking to the future with optimism. “Mid-term, we are planning to more than double unit production in this product class. And this strategic alliance will also impact positively on our development and manufacturing competencies,” he concluded.
The full half-year report will be published on August 13, 2010.
