– Net Sales Pick Up Significantly / Earnings Trend Improved Further
Hamburg—The Jungheinrich Group maintained the upward trend witnessed last year, closing the first quarter of 2011 with strong gains in incoming orders, net sales and earnings. The company’s business trend benefited from the continuously favourable global economic conditions, which led to a substantial rise in market volume in the material handling equipment industry. Market growth in Europe—Jungheinrich’s core market—accelerated, providing strong stimulus for new truck business. The Jungheinrich Group’s earnings trend improved further in the first quarter of 2011.
The world economy maintained its course for growth in the first quarter of 2011, continuing to display marked regional differences. The business cycle in the material handling equipment sector benefited from the significant improvement in the economic environment, enabling the dynamic development displayed by material handling equipment last year to carry over into the first quarter of 2011, posting strong market growth. Worldwide demand for material handling equipment exceeded the small market volume seen in the first quarter of 2010, increasing by 40 per cent to 246.3 thousand forklifts (prior year: 175.7 thousand units). All regions participated in this enlargement, albeit recording extremely different expansion rates in some cases. Europe, Jungheinrich’s core market, posted the steepest climb, gaining 50 per cent. While Western Europe grew by some 44 per cent, demand in Eastern Europe recorded a rise of 89 per cent. Asian market volume increased by 35 per cent, to which China made a disproportionately large contribution, posting a gain of 41 per cent. The North American market was enlarged by 32 per cent.
The value of incoming orders, encompassing all business areas, advanced by 24 per cent to 538 million euros (prior year: 433 million euros) compared to the year-earlier period, displaying disproportionately strong gains in new truck business.
Net sales rose by approximately 22 per cent to 472 million euros in the first quarter of 2011 (prior year: 387 million euros). Whereas domestic business was up 20 per cent year on year to 126 million euros (prior year: 105 million euros) foreign sales posted slightly stronger growth, increasing by 23 per cent to 346 million euros (prior year: 282 million euros). At 73 per cent, the foreign ratio of consolidated net sales was flat. Nearly all business areas participated in this sales growth. In line with the market’s development, the strongest gain was attributable to new truck business, which recorded a rate of increase of 37 per cent, rising to 231 million euros (prior year: 168 million euros). All in all, short-term hire and used equipment operations recorded a rise of 5 per cent to 79 million euros (prior year: 75 million euros). Whereas demand for short-term hire equipment increased considerably, used equipment sales declined slightly. The main reason was the high sales recorded in the same period last year, owing to the substantial shrinkage of the short-term hire fleet caused by the crisis. After-sales services experienced above-average growth, up 8 per cent to 157 million euros (prior year: 145 million euros).
The Jungheinrich Group maintained its positive earnings trend in the first quarter of 2011, posting a jump in earnings. This development benefited primarily from the rise in production across all factories as well as from the further increase in plant capacity utilization and an improved product mix. The marked rise in short-term hire activities and the considerable growth of the after-sales services business also contributed to the rise in earnings. Operative earnings before interest and taxes (EBIT) advanced to 30.3 million euros in the first quarter of 2011 (prior year: 12.0 million euros). The corresponding return on sales more than doubled to 6.4 per cent (prior year: 3.1 per cent). Net income improved to 21.7 million euros (prior year: 8.3 million euros). Earnings per preferred share in the first quarter of 2011 thus advanced to 0.67 euros (prior year: 0.28 euros).
As regards the further development of its business in 2011, Jungheinrich expects the global economic recovery to continue with regional differences. Based on the rise in demand recorded in the first quarter of 2011, Jungheinrich anticipates that the world market will grow by more than 10 per cent to some 900 thousand forklifts for the year as a whole. This would exceed the level witnessed before the crisis in 2008. In view of the worldwide market growth and in line with the market’s dynamic development at the beginning of the year, Jungheinrich is making upward revisions to its previous forecasts for 2011 and now expects to see gains in incoming orders and consolidated net sales of over 2.0 billion euros and over 1.95 billion euros, respectively. The company’s earnings trend will greatly benefit from the rise in demand in new truck business and the associated increase in production capacity utilization in its factories.
Says Hans-Georg Frey, Chairman of the Board of Management, “Last week, we inspired our customers and visitors at CeMAT 2011, the world’s lead intralogistics trade show, with numerous innovative products and services. Jungheinrich’s business trend in the year underway is thus fully dedicated to growth and shaping the future,” Jungheinrich will take advantage of the opportunities arising from the upturn across all areas, in order to generate sustainably profitable growth. To this end, the company intends to improve its market share in individual regions and enlarge its sales presence on growth markets in Eastern Europe, Asia and Latin America. In addition, stepping up business with IC engine-powered counterbalanced trucks and expanding system activities remain the major points of focus in 2011.
Jungheinrich ranks among the world’s leading companies in the material handling equipment, warehousing and material flow engineering sectors. The company is an intralogistics service and solution provider with manufacturing operations, which offers its customers a comprehensive range of forklift trucks, shelving systems, services and advice. Jungheinrich shares are traded on all German stock exchanges.
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