24.10.2024 06:00:18
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Market slowdown in line with expectations
Bucher Industries AG / Key word(s): 9 Month figures/Quarter Results Ad hoc announcement As expected, demand for Bucher Industries’ products and services declined in the first nine months of 2024. The segments associated with agriculture and Bucher Emhart Glass were particularly hard hit by the downturn. Order intake fell significantly, but the slowdown stabilised from mid-year onwards. Sales were also below the prior-year level. The Bucher Municipal division was able to positively distinguish itself from the general trend, recording encouraging sales growth. Bucher Industries expects for 2024 lower sales and now, due to the low capacity utilisation, an operating profit margin in the high single-digit range.
1) Adjusted for currency effects
As expected, demand for Bucher Industries’ products and services declined overall compared to the strong prior-year period. An economic slowdown was particularly noticeable in Europe, while the North American and Asian markets performed better. Order intake fell in all divisions, with the segments associated with agriculture and Bucher Emhart Glass being particularly hard hit by the downturn. The markets for agricultural machinery and for glass containers were characterised by excessive inventories in the sales channels. While the other divisions were unable to match the prior-year sales figures, Bucher Municipal achieved encouraging growth. The order book was in line with the long-term average, with a reach of four months. The cost-saving measures already initiated were consistently continued and selectively expanded at the various locations.
Kuhn Group
1) Adjusted for currency effects
Decline in demand Lower prices for agricultural products, high interest rates and fewer subsidies continued to make farmers cautious in terms of investment. In Brazil and Europe, harvests were poorer due to the weather conditions, while North America is expecting high yields. The dairy and livestock farming segments benefited globally from solid milk and very high meat prices. Many dealers are suffering from high inventories and were therefore hesitant to place pre-orders. This resulted in a significant decline in order intake, especially in Brazil and Europe. Kuhn Group’s order intake declined overall, with hay and forage machinery performing the best. The division’s sales fell compared to the prior-year period, with Brazil being a major contributing factor. The order book had a reach of four months and was therefore in line with the long-term average. Capacity adjustments have been made in Brazil as well as in Europe, and Kuhn Group is continuing to work on optimising its costs. Outlook for 2024 Kuhn Group expects sales to decrease and the operating profit margin to be significantly lower.
Bucher Municipal
1) Adjusted for currency effects
Encouraging increase in sales Demand at Bucher Municipal was stable overall, with order intake strong in most markets, particularly towards the end of the reporting period. The truck-mounted sweeper and sewer cleaning vehicle segments benefitted from the stable capacity to deliver chassis units and from the strong market positions in the core European markets such as the UK, Germany and Denmark. Orders for winter maintenance equipment increased in the first nine months. Business with maintenance services and spare parts also continued to develop positively. Orders for compact sweepers declined compared to the high level recorded in the prior-year period, impacted by the lower subsidies for electrified vehicles in Europe, among other things. The refuse collection vehicle segment in Australia could not reach the very high level of the prior year. Bucher Municipal’s sales significantly exceeded the prior-year period. The order book had a reach of six months. Outlook for 2024 Bucher Municipal forecasts sales in line with prior-year figures. The operating profit margin is likely to increase, it will probably not yet reach the margin target of 9% due to the expected product mix in the year 2024.
1) Adjusted for currency effects
Decline in demand Bucher Hydraulics’ market declined overall. An economic slowdown was particularly noticeable in Europe, especially in Germany. Encouragingly, however, demand stabilised in North America. In addition, the recovery in China continued. Overall, order intake at Bucher Hydraulics declined due to the strong market exposure to Europe. The weak cycle in the agricultural machinery segment was an important factor, as well as the decline in the construction machinery segment and electrical converter. The materials handling segment remained more stable. The division’s sales declined. The order book had a reach of three months. The division continued to rigorously follow through with the cost-saving measures initiated in the prior year. In addition, partial short-time work has been introduced at some locations. Outlook for 2024 Due to the weakening market momentum, Bucher Hydraulics expects both sales and the operating profit margin to decline.
1) Adjusted for currency effects
Weakening market Demand for glass forming and inspection machinery weakened and was significantly below the very high level of the prior-year period. The full stocks of glass containers prompted some manufacturers to shut down glass melting furnaces, which had a negative impact on the spare parts business. The downturn hit Europe and North America in particular, also due to the higher energy prices, while some smaller emerging markets continued to record growth. Order intake at Bucher Emhart Glass fell significantly compared to the strong prior-year period. Capacity utilisation was good thanks to the high order book. Uncertainties regarding market developments led at specific customers to project delays, which had a negative impact on sales. No cancellations were recorded. The order book was reduced but still had a reach of five months. Production planning was adapted to the situation. Outlook for 2024 Bucher Emhart Glass anticipates only slightly weaker sales compared to the very high sales of the previous year. Accordingly, the operating profit margin is expected to be somewhat lower than in 2023.
1) Adjusted for currency effects
Varying market developments Bucher Specials’ markets presented a mixed picture in the first nine months of 2024. Demand at Bucher Vaslin remained below the prior-year level, while demand at Bucher Unipektin was unchanged. At Bucher Landtechnik, there was a noticeable stabilisation in the market at a low level. Order intake at Bucher Automation was significantly below the prior-year period, partly due to the slowdown in momentum in the markets served by internal customers Bucher Emhart Glass and Bucher Hydraulics. Overall, the division’s order intake was below the level of the prior-year period. The division’s sales declined, with Bucher Vaslin in particular unable to match the high level of the prior-year period. The order book had a reach of three months. Outlook for 2024 Bucher Specials expects a decline in sales and a significantly lower operating profit margin compared to the prior-year period.
Group outlook for 2024 Bucher Industries expects demand to continue to be affected by the volatile environment in the fourth quarter. While it is unlikely that the agricultural machinery market will recover, the stabilisation in other markets is expected to continue. The Group expects lower sales in 2024. The optimisation measures already initiated are being continued. Due to the low capacity utilisation, the operating profit margin is also expected to decline compared to the prior year and be in the high single-digit range. Accordingly, the Group’s profit for the year is expected to be lower than the high level recorded in the prior year. The Group will continue to maintain its long-term focus and invest consistently in innovations. The Group has been negotiating the sale of a property not required for operations for some time, which could be concluded by the end of 2024 or in early 2025. The profit from a sale in the current year would increase the operating profit margin by around 1.4 percentage points. Contact for investors and financial analysts Contact for media _________ Simply great machines Additional performance measures: Internally and externally Bucher Industries uses key figures that are not defined by Swiss GAAP FER. The composition and calculation of the individual performance measures are set out here: bucherindustries.com/en/additional-performance-measures. End of Inside Information |
Language: | English |
Company: | Bucher Industries AG |
Murzlenstrasse 80 | |
8166 Niederweningen | |
Switzerland | |
Phone: | +41 58 750 15 00 |
E-mail: | info@bucherindustries.com |
Internet: | www.bucherindustries.com |
ISIN: | CH0002432174 |
Listed: | SIX Swiss Exchange |
EQS News ID: | 2014855 |
End of Announcement | EQS News Service |
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2014855 24-Oct-2024 CET/CEST