Wacker Neuson continues to grow significantly in the third quarter of 2022 and has increased profitability. The firm’s revenues were up 18.1% year-on-year in the first nine months despite continuing challenging environment. The EBIT margin of 8.8% noticeably improved compared with first half of 2022, although this was still down from prior year.
The company’s net working capital remains at high level and has been impacted by supply chain issues. The company’s supply chains and price dynamics on the procurement market remain challenging.
Group revenue for the first nine months of 2022 once again marked a record level at €1.641 billion, compared with €1.38.7 billion for the same period in 2021. Adjusted for foreign exchange, the increase amounted to 15.1%. At €144.6 million, earnings before interest and taxes (EBIT) were almost on a par with the €144.8 million for the same period in 2021.
"Even though the challenges are steadily increasing over the course of this year, we have so far succeeded in continuing to grow strongly quarter by quarter and catch up in terms of profitability. Demand from our customers remains high, meaning that our order backlog continues to grow and now extends well into the second half of 2023," explained Dr Karl Tragl, CEO of the Wacker Neuson Group. "From a business perspective, this exceptionally high level of visibility gives us additional planning certainty. "
In the Europe (EMEA) segment, revenue increased by 13% to €1.242.2 billion in the first nine months compared with €1.0993 billion for the same period in 2021. German, France ands the UK proved the strongest markets for the firm in Europe.
Revenue of the agricultural machinery brands, Kramer and Weidmann, also increased significantly accordingly, rising by 25.5% to €318 million compared with €253.4 million for the same period in 2021.
In the Americas, the positive trend from the first half of the year continued. Revenue developed extremely dynamically in the first nine months, increasing by 37.2% to €333.1 million. Adjusted for foreign exchange, growth amounted to 22.9 percent. Within the region, there was a good performance in the USA and Canada.
In the Asia-Pacific region, the increase in revenue was even higher at 37.7% to €65.7 million. Adjusted for foreign exchange, the increase was also the most significant in a comparison of the regions, at 29.6%. Among the individual markets, Australia again showed strong growth. The Chinese market remained weak. However, production in China continues to represent an attractive export hub for the African and South American markets in particular, due to the prevailing cost structures.
Net working capital amounted to €760.7 million at the end of September 2022, compared.
"Our extremely high order backlog reflects both the continued high demand for our products and the robustness of our business model. It therefore remains our primary goal to be able to meet this demand in the best possible way, even in times of ongoing supply chain issues," explains Christoph Burkhard, CFO of the Wacker Neuson Group. "Our main focus remains on profitable growth. Accordingly, we have so far made a conscious decision not to reduce inventories in the short term so as not to jeopardise our growth opportunities. Nevertheless, we are working to reduce our net working capital by the end of the year."
The firm says that the continuing high demand for the company's products and the resulting above-average order situation provide a relatively good starting position from the company's point of view, enabling it to position itself adequately even in the event of a deterioration in the economic environment.
