Demag Cranes Reports Surge in Earnings in the Second Quarter – Forecast for Year-End Increased
Düsseldorf, 08. May 2008
- Group order intake remains strong (up 9.9 percent)
- Group revenue growing dynamically (up 10.4 percent)
- Adjusted Group EBIT boosted significantly (up 47.7 percent)
Year-end forecast increased (New: Group revenue forecast of up to around EUR
1.2 billion, adjusted Group EBIT of up to around EUR 125 million)
Demag Cranes AG continued its positive trend of the first quarter also in its second quarter (1 January to 31 March) of financial year 2007/2008. Thanks to an ongoing strong order situation, financial figures were up significantly across the board in a year-on-year comparison. Demag Cranes AG CEO, Harald J. Joos emphasises: "Business has developed extremely satisfactorily in the second quarter. In particular, the significant improvement in the earnings situation underlines that the measures we initiated to increase efficiency and reduce costs are taking effect."Order Situation Continues To Be Very Positive
In the second quarter of financial year 2007/2008, order intake and the order book also developed very well. Compared to the prior year's figure, order intake grew exclusively in organic terms by 9.9 percent to
EUR 353.0 million. The main driving forces behind this development were the Industrial Cranes and Port Technology segments. On the balance sheet date (as at 31 March 2008), the order book was up by 22.2 percent to
EUR 492.2 million. At the end of the first six months, the Group recorded an increase in the order intake volume of 8.8 percent to EUR 648.0 million.
At segment level, the Industrial Cranes segment profited from ongoing keen demand for products.
At EUR 197.4 million, order intake went up significantly by 14.9 percent over the previous year. In a year-on-year of the first six months, this figure rose by 13.6 percent to EUR 343.6 million. In particular, the Standard and Process Cranes product lines contributed to this very positive performance. At EUR 312.6 million, the order book was 32.4 percent higher than the prior year's figure on the same date. Order intake in the Port Technology segment grew in a quarterly year-on-year comparison by 9.1 percent to EUR 71.0 million. In a year-on-year of the first six months, order intake increased by 2.4 percent. As the mainstay of this segment is based almost exclusively on project business with a relatively low number of units, segment order intake is subject to fluctuations during the year. At EUR 127.9 million, the order book was 12.5 percent higher compared to the prior year's figure. In the Services segment, order intake rose slightly to EUR 84.7 million compared to the same quarter of the prior year. In a year-on-year comparison for the first six months, this figure was up 5.1 percent to EUR 167.3 million. The order book remained at the same level of the prior year's balance sheet date.
Group Revenue Continues to Grow Dynamically
Group revenue rose in a quarterly year-on-year comparison by 10.4 percent to EUR 281.6 million. Compared with the first half of financial year 2006/2007, this figure went up by 15.1 percent. All three segments contributed to this very positive performance. Growth in the Industrial Cranes segment was maintained in the second quarter. At EUR 132.5 million, segment revenue was up by 13.1 percent over the previous year. In a year-on-year comparison of the first six months, revenue was even boosted by 20.0 percent to
EUR 274.3 million. Indeed, all product lines underwent considerable growth. The Port Technology segment recorded an increase in revenue of 9.4 percent to EUR 70.5 million. The main driver for this performance was the high demand for Mobile Harbour Cranes. Revenue in the Services segment grew by 7.1 percent to
EUR 78.6 million compared to the prior year's quarter. Weighed against the first half of financial year 2006/2007, revenue rose by 12.1 percent. The main driving factors were spare parts business and refurbishment services.
Adjusted Group EBIT Boosted Significantly
The Demag Cranes Group continued its very satisfactory earnings performance in the second quarter of financial year 2007/2008. Adjusted Group EBIT rose notably by 47.7 percent to EUR 34.1 million compared to the prior year's figure. In a year-on-year comparison of the first six months, adjusted Group EBIT was up
45.5 percent to EUR 64.0 million. Industrial Cranes and Services mainly contributed to this excellent development.
The Industrial Cranes segment recorded a surge in earnings. The adjusted EBIT of EUR 13.2 million was a remarkable 141.5 percent higher than in the same period of the previous year. In a year-on-year of the first six months, adjusted EBIT was EUR 22.7 million, corresponding to growth of 117.0 percent. This highly positive performance is attributable to the year-on-year increase in revenue for all product lines and the improvement in efficiency. In the Port Technology segment, adjusted EBIT grew by 35.3 percent to
EUR 4.4 million. In a year-on-year comparison of the first six months, adjusted EBIT was up 20.7 percent to EUR 7.3 million, accounting for the anticipated improvement of the earnings situation. This improvement is due to the scheduled reduction in manufacturing costs for the Generation 5 Mobile Harbour Cranes. In the Services segment, adjusted EBIT rose by 23.3 percent to EUR 18.9 million in a quarterly year-on-year comparison. This growth was driven, in particular, by spare parts business. At EUR 37.9 million, adjusted EBIT was 32.3 percent higher in a year-on-year sixmonth comparison over the previous year.
Year-End Forecast Increased
Demag Cranes AG has increased its forecast and now anticipates Group revenue of up to around
EUR 1.2 billion (previously EUR 1.13 to EUR 1.16 billion) and adjusted EBIT to be up to around EUR 125 million (previously: some EUR 110 million) at year end. The Management Board anticipates that business will continue to develop positively in the remaining quarters of financial year 2007/2008. Chairman of the Management Board, Joos underlines: "There is an on-going high demand for our products and services. Thanks to this satisfactory order situation, we are well-equipped for the remainder of the financial year."
About Demag Cranes AG
The Demag Cranes Group is one of the world's leading suppliers of industrial cranes and crane components, harbour cranes and port automation technology. Services, in particular maintenance and refurbishments, are another key element of the Group’s business activities. The Group is divided into the business segments Industrial Cranes, Port Technology and Services and has strong and well-established "Demag" and "Gottwald" brands. Demag Cranes sees its core competence in the development and construction of technically sophisticated cranes and hoists as well as automated transport and logistics systems in ports and terminals, the provision of services for these products and the manufacture of high-quality components.
As a global supplier, Demag Cranes manufactures in 16 countries on five continents and operates a worldwide sales and service network that is present in over 60 countries through its subsidiaries, representative offices and a joint venture. In financial year 2006/2007, the Group, with its 5,813 employees, generated revenue of around EUR 1,080 million. Since the end of June 2006, the Demag Cranes share
(WKN: DCAG01) has been listed in the Prime Standard of the German Stock Exchange and is traded on various indices including the MDAX®.
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Conditions for forward-looking statements
This press release contains forward-looking statements relating to the business, financial performance and earnings of Demag Cranes AG and its subsidiaries and associates. Forward-looking statements are based on current plans, estimates, projections and expectations and are therefore subject to risks and uncertainties, most of which are difficult to estimate and which in general are beyond the control of Demag Cranes AG. Consequently, actual developments as well as actual earnings and performance may differ materially from those which are explicitly or implicitly assumed in the forward-looking statements. Demag Cranes AG does not intend or accept any obligation to publish updates of these forward-looking statements.