2008 financial year
High orders received level
May 6, 2008
- Substantial increase general industry
- EBIT margin 5.6 percent, significantly above last year's 3.4 percent
- Targets for 2008 confirmed
The KUKA Group's new financial year got off to a good start. The company generated significantly higher earnings in the first quarter of 2008. EBIT rose from the prior year's EUR 9.8 million to EUR 15.8 million. EBIT margin was also up, mainly thanks to better capacity utilization. It rose from 3.4 percent last year to 5.6 percent.
"There is increasing demand for robot-based automation solutions of the type KUKA offers and supplies. We conduct business in a growing market," says Gerhard Wiedemann, CEO of KUKA AG, regarding the growth of the company.
Orders received for Q1 2008 came in at EUR 404.3 million, down EUR 32.6 million from the same time last year. However, this year, the Group's subsidiary KTPO changed the purchase of raw materials worth EUR 35 million, and the US dollar/Euro exchange-rate reduced order values by EUR 15 million. Adjusted for these factors, orders received were actually up by about EUR 18 million.
First quarter sales revenues were EUR 280.2 million, down 3.6 percent or EUR 10.5 million from last year. However, after adjustments similar to those made for orders received, they were about EUR 33 million higher than the prior year's comparable quarter. The changed purchase of raw materials also had an impact of EUR 35 million on sales revenues. The exchange-rate had a EUR 8 million impact on sales.
Order backlog ended at EUR 647.3 million, slightly higher than last year. This secures the Group's present level of activity for a relatively long 5.8 months. The Group was able to extend the rising trend from 2007 and in the first quarter of 2008 generated an EBIT of EUR 15.8 million. The negative impact of the US dollar/Euro exchange-rate on EBIT was less than EUR 1.0 million. In total, the improvement corresponds to a jump of 61.2 percent over the same period last year. EBIT margin rose from 3.4 percent in 2007 to 5.6 percent for the current financial year. Both divisions contributed to this delightful development.
After subtracting interest expenses totaling EUR -1.6 million, down from last year's EUR -4.4 million, and taxes of EUR 4.4 million, up from last year's EUR 1.5 million, earnings after taxes in the first quarter came in at EUR 9.8 million, which compares to EUR 1.2 million in 2007. This increase demonstrates the rising profitability of the KUKA Group. In addition, there were no losses from discontinued operations, as there were in the first quarter of 2007.
There was a significant drop in cash and cash equivalents on the asset side of the March 31, 2008 balance sheet due to the KTPO financing, which was prepaid using the KUKA Group's existing net liquidity. The KUKA Group's net cash position as of March 31 of the current financial year was EUR 28.7 million. This represents an improvement of EUR 141.9 million over the March 31, 2007 period end.
The KUKA Group had 5,831 employees as of March 31, 2008. This is 3.5 percent, or 199 persons, more than last year at the same time. The added employees strengthened the new distributors in India, Russia, Japan, Taiwan and other locations, particularly Germany.
Robotics: Sales and earnings up substantially
The Robotics division reported orders received of EUR 116.8 million in the first quarter of 2008, the same level as the year prior. The division succeeded in substantially increasing the share of new business coming from general industry. These orders received rose from the prior year's EUR 40.7 million to EUR 59.9 million.
Sales revenues in the first quarter of the current financial year came in at EUR 117.5 million, 28.3 percent or EUR 25.9 million higher than a year earlier, driven by growth in all three business segments - automotive, general industry and service.Higher sales and higher capacity utilization in the first three months lifted the Robotics division's EBIT significantly above last year's level. It came in at EUR 10.1 million, versus EUR 6.0 million in the first quarter of 2007. This is an increase of EUR 4.1 million or 68.3 percent. EBIT margin thereby improved from 6.6 percent to 8.6 percent.
Systems wins solar industry orders
The Systems division reported orders received of EUR 300.0 million for the first quarter of 2008, missing the prior year's comparable number by 8.8 percent or EUR 28.8 million. However, when adjusted for the changed purchase of raw materials by the KTPO subsidiary and the impact of the Euro/US dollar exchange-rate, the orders received level is actually EUR 18 million higher than at the same time last year.
KUKA Systems received trendsetting orders from the international solar industry at the beginning of the year. It will now be shipping robot-based manufacturing systems for building photovoltaic modules to Evergreen in the United States. Since last year, the division has been expanding its plant assembly and systems business beyond the automotive industry.
Sales revenues totaling EUR 174.9 million were posted in the first quarter of 2008, down 16 percent or EUR 33.4 million from 2007. Adjusted for the effects of the changed KTPO purchasing activity and the exchange-rate impact, which when combined total about EUR 43 million, sales revenues actually increased over last year.
EBIT in the first quarter reached EUR 8.4 million, 44.8 percent higher than in the first quarter of 2007. EBIT margin rose from 2.8 percent to 4.8 percent.
Outlook for 2008 confirmed
The KUKA Group's 2008 financial year started well, and the company is solidly positioned for further success in the current business year.
The Robotics division's growth for the current fiscal year is expected to be 10 percent. The Systems division expects an increase in business volume of about 4 percent in 2008. Taking into account the new purchasing activities for raw materials by KTPO, Systems is also planning growth in line with the medium-term business plan. The budget calls for average annual growth of 10 and 5 percent to 2010 for the Robotics and Systems divisions respectively. Based on continued high utilization of capacities and the improved earnings structure, the Executive Board is aiming to increase the KUKA Group's operating EBIT margin from 4.9 percent in 2007 to at least 5.5 percent for the current fiscal year.