Interim report to september 30, 2007
Dynamic business growth based on a solid financing structure
06 November 2007
- Third-quarter orders received and sales revenues significantly above last year for both Robotics and Systems
- Third-quarter EBIT margin of 6.5 percent significantly above forecast
- Net liquidity and equity ratio further improved
The KUKA Group's positive operating performance extended into the third quarter of 2007.
Orders received were 52.0 percent higher than in the prior year's third quarter. The Robotics division's share of the EUR 331.2 million in orders received generated during the third quarter of 2007 was EUR 97.9 million, while the Systems division contributed EUR 242.3 million. Robotics' orders received therefore increased by 17.7 percent over the prior year's quarter and Systems' soared by 65.1 percent. The significant growth in the division includes the major orders received from German carmakers already announced in the previous interim report and confirms KUKA Systems' excellent market position in the field of flexible manufacturing systems. The Robotics division also landed significant orders from European automotive customers. The general industry business continues to grow in parallel.
Third-quarter 2007 sales revenues came in at EUR 317.9 million, 16.7 percent above last year's equivalent result. The Robotics division was 19.5 percent higher and Systems was up 14.2 percent. This factor, together with higher margins, caused EBIT to almost triple from EUR 7.1 million in March 2006 to EUR 20.8 million in the third quarter of 2007. The Group's consolidated EBIT margin in the third quarter was 6.5 percent. Included here are netted one-time revenues of approximately EUR 3 million from the sale of properties. The Robotics division achieved an EBIT margin of 8.0 percent and the Systems division generated an EBIT margin of 4.3 percent in the third quarter.
As for the cumulative figures for the first nine months, KUKA generated orders received of EUR 1,056.1 million. This increase of 20.3 percent over last year's results exceeded our forecasts. In the Robotics division, order volume in the first three quarters rose from EUR 271.1 million a year ago to EUR 324.1 million during the current financial year. This corresponds to an improvement of 19.5 percent. The Systems division's results were strongly influenced by significant growth in the US systems business and the pay-on-production unit (KTPO). Orders received reported here in the first three quarters totaled EUR 762.1 million, which compares to EUR 636.7 million in 2006. Some of the growth was also due to the business in China and Brazil where performance was better than expected.
During the first nine months of 2007, the KUKA Group was able to generate substantially higher sales revenues than during the prior year's equivalent period. Current sales revenues totaled EUR 933.0 million, which compares to the prior year's EUR 774.2 million and corresponds to a year-over-year increase of 20.5 percent. The Robotics division's sales revenues grew 9.4 percent over the previous year's equivalent period and the Systems division's corresponding numbers were 26.3 percent higher than a year prior. The well loaded car body production unit with its pay-on-production contract in Toledo, USA, drove these results. While this project was still at the startup stage last year, it started full production in 2007.
The KUKA Group achieved an EBIT of EUR 49.1 million in the first nine months compared to EUR 7.6 million during the same period in 2006. The EBIT margin based on sales is therefore 5.3 percent, whereas last year it was 1.0 percent. Included here are balanced one-time revenues of approximately EUR 5 million from the sale of properties, which contributed to the result. The two divisions' contribution to earnings from operating activities was proportionally equal. The Systems division achieved an EBIT of EUR 24.3 million compared to EUR 1.4 million a year earlier, which represents an EBIT margin of3.7 percent. The Robotics division generated an operating profit of EUR 23.3 million compared to EUR 14.2 million last year, which represents an EBIT margin of 7.8 percent.
The result from discontinued operations remains unchanged at EUR 63.8 million, and earnings after taxes therefore totaled EUR 96.8 million. The improved financial strength of the KUKA Group was also reflected in a rise in net liquidity, which now stands at EUR 106.7 million, as well as an equity ratio of 25.4 percent as of September 30, 2007.
The KUKA Group had 5,730 employees as of September 30, 2007, expressed as full time staff, which reflects an increase of 486 persons over the workforce of 5,244 workers as of September 30, 2006. The Robotics division created new jobs, mainly due to the higher order volume. New workers were hired primarily in the assembly and service areas, but also in product development.
The pleasant business performance of the first half year carried over sustainably into the third quarter of 2007. The KUKA Group generated an EBIT of EUR 20.8 million in the third quarter of 2007. Total EBIT for the first nine months of 2007 is therefore EUR 49.1 million, which corresponds to an EBIT margin of 5.3 percent. Included in the cumulative EBIT as of September 30, 2007 are net profits of EUR 5 million from the sale of properties. Net operating profit margin thus stands at 4.7 percent. Given these results, the Executive Board expects a higher EBIT margin from operating business for the 2007 financial year than the previously targeted 4.6 percent. Added to this will be profits from the aforementioned property sales.
The Executive Board also expects an improvement in net liquidity from the current target of approximately EUR 100 million, which was exceeded as of September 30, 2007 (EUR 106.7 million).
The Executive Board is therefore aiming to resume payment of a dividend for the 2007 financial year.
"I am pleased for our shareholders to be in the position to announce a possible dividend payment. The business performance confirms that the strategy we have adopted is correct. We have thus already been able to start the stage of profitable growth already during the current financial year." said Gerhard Wiedemann, CEO of KUKA Aktiengesellschaft in his comments on the Group's performance.