GILDEMEISTER with positive result in the 3rd quarter
The global economy is continuing its recovery trend. Demand for machine tools is also picking up. This positive development is also reflected in the third quarter at GILDEMEISTER. The trend reversal in the core “Machine Tools” segment has been achieved with +67% in order intake. In the third quarter, it has been possible to generate a positive quarterly result (EBT) again. The growing order intake will also have a positive effect on sales revenues and earnings in the coming months.
As of 30 September 2010, order intake had reached the Euro 1 billion mark; it rose by 24% to € 1,013.8 million (previous year: € 818.2 million). Of this, the machine tool business accounted for € 620.6 million; “Services” for € 302.6 million and “Energy Solutions” for € 90.4 million. Sales revenues of € 858.4 million reached the previous year’s level (€ 847.7 million). In the fourth quarter, a considerable rise in sales revenues will take place.
Profitability developed as follows: As of 30 September, EBITDA had reached € 30.2 million (previous year: € 45.5 million); EBIT amounted to € 9.1 million (previous year: € 23.8 million). EBT amounted to € – 18.3 million (previous year: € 7.0 million). As of 30 September 2010, the group reports earnings after taxes of € – 13.6 million (previous year: € 4.5 million).
GILDEMEISTER expects the upwards trend to continue and confirms its targets for the current financial year. Growing demand was also confirmed at the international autumn trade fairs – the IMTS inChicago, the AMB in Stuttgart and the BIMU in Milan. We achieved particular success at the AMB in Stuttgart where 260 machines were sold with a value of € 51.4 million.
Our cooperation with the Japanese machine tool builder, Mori Seiki, is progressing successfully and is providing a further important boost.
For the entire year 2010 we are now expecting order intake of more than € 1.35 billion. We are planning to increase sales revenues to more than € 1.3 billion. As before, according to our current planning status, break-even results (EBT) could be achieved.
Sales revenues in the third quarter reached € 329.5 million (+40%; previous year: € 235.0 million) and thus, as planned, progressed better than in the previous quarters, which were marked by fewer advance orders in the machine tools business. In the first nine months of the year, sales revenues of € 858.4 million were at the previous year’s level (€ 847.7 million). In the fourth quarter, a considerable rise in sales revenues will take place. International sales revenues increased by 11% to € 513.9 million; domestic sales revenues fell by 10% to € 344.5 million. The export share amounted to 60% (same period in previous year: 55%).
Order intake in the third quarter reached € 362.3 million (+53% compared to the previous year’s quarter: € 237.5 million). In the core “Machine Tools” business we were able to increase order intake markedly at +67% against the comparable previous year’s period. As of 30 September 2010, order intake reached the Euro 1 billion mark; it rose by 24% or € 195.6 million to € 1,013.8 million (previous year: € 818.2 million). In the reporting period domestic order intake rose especially; orders increased markedly by 64% to € 401.8 million (previous year: € 244.8 million). International orders grew 7% to € 612.0 million (previous year: € 573.4 million). International orders accounted for 60% of orders (previous year: 70%).
As of 30 September 2010, the order backlog for the group amounted to € 742.1 million.
The profitability of the GILDEMEISTER group developed as follows: In the third quarter, it was possible to generate positive quarterly earnings (EBT) again. EBITDA reached € 25.5 million (previous year: € 4.1 million), EBIT was positive at € 18.4 million (previous year: € –3.1 million). EBT amounted to € 8.1 million (previous year: € –8.1 million). Earnings after taxes amounted to € 5.4 million (previous year: € –5.2 million).
Thus as of 30 September, EBITDA reached € 30.2 million (previous year: € 45.5 million); EBIT amounted to € 9.1 million (previous year: € 23.8 million). EBT amounted to € –18.3 million (previous year: € 7.0 million). As of 30 September 2010, the group reported earnings after taxes of € –13.6 million (previous year: € 4.5 million).
As of 30 September 2010, GILDEMEISTER had 5,405 employees, including 214 trainees (31 Dec. 2009: 5,450). At the end of the third quarter, 3,300 employees (61%) worked at our national companies and 2,105 employees (39%) at our international companies. The personnel expenses ratio was 27.4% (corresponding period in the previous year: 29.9%); employee expenses decreased by € 12.2 million to € 243.3 million (corresponding period in the previous year: € 255.5 million).
The GILDEMEISTER share recorded a recovery in price in the third quarter. In particular, the more optimistic assessment of the worldwide recovery of machine tool building had an effect on the share’s performance. Following a share price of € 9.04 as of 1 July, the share closed the reporting period at € 10.71 (30 Sep. 2010). The share is currently listed at € 13.50 € (5 Nov. 2010).
The global economy is continuing its recovery trend according to current forecasts. Theworldwide market for machine tools is developing positively in 2010. The German Machine Tool Builders’ Association (VDW) and the British economic research institute, Oxford Economics, have now revised their latest forecasts upwards (as at October 2010) for growth in worldwide consumption to 5.5% or € 38.3 billion.
GILDEMEISTER can maintain its position well in an ongoing demanding market environment in the main sales markets. Stimuli continue to come from China but also the USA, Brazil, India and Turkey are showing marked rates of growth. This is where we will further strengthen our sales and services and cement our position. For the financial year 2010, GILDEMEISTER expects a further recovery and confirms its targets. Growing demand was also confirmed at the international autumn trade fairs – the IMTS in Chicago, the AMB in Stuttgart and the BIMU in Milan. We are now expecting order intake of more than € 1.35 billion. In the Machine Tools business we will increase order intake further. The Service business will likewise progress positively. In “Energy Solutions” order intake will progress as planned below the previus year's level due to the remaining high order backlog.
We plan to increase sales revenues to more than € 1.3 billion. A further rise will take place in “Machine Tools” in the fourth quarter. In “Services”, we expect a rise in sales revenues in double figures. In “Energy Solutions”, we plan to double sales revenues.
We are working on further improving the profitability of the company. Following the positive results in the third quarter, earnings will further develop positively in the fourth quarter with the growing sales revenues performance. As before, according to our current planning status, break-even results (EBT) could be achieved.
GILDEMEISTER is viewing financial year 2011 with optimism. We are expecting further growth in demand for machine tools worldwide and according to current forecasts, an increase here of up to 20% is possible. The Service business will also grow further and the “Energy Solutions” business will develop positively. We are expecting a clear improvement in earnings.
Also for the financial year 2012 we are expecting dynamic development in all our business divisions. We are expecting a further rise in order intake and sales revenues; both in the machine tools and in the service business and in “Energy Solutions”. Earnings shall again improve further.
GILDEMEISTER plans to intensify further its existing cooperation with Mori Seiki and in this respect will restructure its financing in the first six months of 2011. Within the scope of our long-term corporate strategy, we want to expand the sustainable, successful cooperation in production, in procurement, in the area of research and development, as well as in sales and services further. The Supervisory Board has agreed the key points in a corresponding cooperation agreement. In the event of an appropriate capital market environment, GILDEMEISTER likewise plans to carry out capital increases in the first six months of 2011 with the participation of Mori Seiki. The structuring and implementation with and without subscription rights depends, amongst others, on the approval of the cartel authorities.
The Executive Board
Disclaimer, Forward-looking statement
Statements relating to the future:
This press release contains forward-looking statements, which are based on current estimates of the management of future developments. Such statements are based on the management's current expectations and specific assumptions. They are subject to risks, uncertainties and other factors, which could lead to the actual future circumstances, including the assets, liabilities, financial position and profit or loss of GILDEMEISTER, differing materially from or being more negative than those expressly or implicitly assumed or described in these statements. The business activities of GILDEMEISTER are subject to a series of risks and uncertainties, which may result in forward-looking statements, estimates or forecasts becoming inaccurate. Should one of these factors of uncertainty or other unforeseeable event occur, or should the assumptions on which these statements are based prove incorrect, the actual results may differ materially from the results stated, expected, anticipated, intended, planned, aimed at, estimated or projected in these statements. Forward-looking statements must not be understood as a guarantee or assurance of the future developments or events contained therein.