German engine manufacturer Deutz has today announced its financial results for 2015. New orders amounted to €1.2259 billion, down by 11.1% on the prior-year figure of €1.379 billion. In the service business, new orders were up by 7.2% however, although other segments reported a decrease in new orders compared with 2014.
German engine manufacturer 201 Deutz has today announced its financial results for 2015. New orders amounted to €1.2259 billion, down by 11.1% on the prior-year figure of €1.379 billion. In the service business, new orders were up by 7.2% however, although other segments reported a decrease in new orders compared with 2014.
The number of engines sold fell by 29.8%, from 196,403 engines in 2014 to 137,781 in 2015. The year-on-year decline in unit sales was particularly pronounced in the Agricultural Machinery and Mobile Machinery application segments. Revenue dropped by 18.5% to €1.2474 billion compared to €1.5302 billion for 2014. This trend is attributable to the effect of the advance production of engines that European customers had purchased in 2014 before a new emissions standard for engines under 130kW and a reluctance to invest on the part of end customers since the second half of 2015.
Despite the lower level of capacity utilisation, the company says it generated an operating profit (EBIT before one-off items) of €4.9 million (2014: €31.7 million). The EBITDA margin (before one-off items) remained on a par with 2014 at 9%. Net income came to €3.5 million (2014: €19.5 million). "This is consistent with our strategic objective of operating profitably even during downturns in the business cycle and underlines the effectiveness of the efficiency measures that we have initiated," said the firm’s chief financial officer, Dr Margarete Haase.
On a positive note, the firm continues to maintain a very sound balance sheet. The equity ratio went up slightly, reaching 45.5% as at 31 December 2015 compared with 44.5% at the end of 2014. There was a further improvement to the net financial position, which rose by €25.3 million to €39.0 million (31 December 2014: €13.7 million). In addition, free cash flow was well into positive territory at €35.0 million (2014: €52.0 million).
"We will continue to focus on increasing efficiency and quality. The measures to optimise our network of sites in Germany are running to plan and we have forged ahead with the consolidation of our sites in China. Our engine portfolio is at the cutting edge of technology and we are adding a 2.2litre diesel and gas engine," explained Dr Helmut Leube, chairman of the Deutz board.
The firm expects market conditions to remain challenging in 2016 and forecasts that revenue will stagnate or, at best, rise slightly. Capacity utilisation is likely to change only insignificantly, and the EBIT margin is expected to increase moderately. This will be predominantly achieved through further cost-saving measures and the first positive effects from the optimisation of our site network.
The number of engines sold fell by 29.8%, from 196,403 engines in 2014 to 137,781 in 2015. The year-on-year decline in unit sales was particularly pronounced in the Agricultural Machinery and Mobile Machinery application segments. Revenue dropped by 18.5% to €1.2474 billion compared to €1.5302 billion for 2014. This trend is attributable to the effect of the advance production of engines that European customers had purchased in 2014 before a new emissions standard for engines under 130kW and a reluctance to invest on the part of end customers since the second half of 2015.
Despite the lower level of capacity utilisation, the company says it generated an operating profit (EBIT before one-off items) of €4.9 million (2014: €31.7 million). The EBITDA margin (before one-off items) remained on a par with 2014 at 9%. Net income came to €3.5 million (2014: €19.5 million). "This is consistent with our strategic objective of operating profitably even during downturns in the business cycle and underlines the effectiveness of the efficiency measures that we have initiated," said the firm’s chief financial officer, Dr Margarete Haase.
On a positive note, the firm continues to maintain a very sound balance sheet. The equity ratio went up slightly, reaching 45.5% as at 31 December 2015 compared with 44.5% at the end of 2014. There was a further improvement to the net financial position, which rose by €25.3 million to €39.0 million (31 December 2014: €13.7 million). In addition, free cash flow was well into positive territory at €35.0 million (2014: €52.0 million).
"We will continue to focus on increasing efficiency and quality. The measures to optimise our network of sites in Germany are running to plan and we have forged ahead with the consolidation of our sites in China. Our engine portfolio is at the cutting edge of technology and we are adding a 2.2litre diesel and gas engine," explained Dr Helmut Leube, chairman of the Deutz board.
The firm expects market conditions to remain challenging in 2016 and forecasts that revenue will stagnate or, at best, rise slightly. Capacity utilisation is likely to change only insignificantly, and the EBIT margin is expected to increase moderately. This will be predominantly achieved through further cost-saving measures and the first positive effects from the optimisation of our site network.
