Highlights and key figures
Krones reports good first quarter 2021
- Upward trend in order intake continues. Order value increased in first three months by 27.1% to €1,068.8 million.
- First quarter revenue of €874.6 million down 7.2% on prior-year figure, which was not yet severely affected by corona.
- Despite lower revenue from January to March, Krones was able to limit the decline in earnings before interest, taxes, depreciation and amortisation (EBITDA) from €89.5 million to €76.5 million. The EBITDA margin was 8.7% in the reporting period, down on the high prior-year figure of 9.5%.
- Based on the positive first-quarter trend, Krones is confident of meeting the forecast for 2021. For the full year, the company expects revenue growth of 2.5% to 3.5% and an EBITDA margin of 6.5% to 7.5%.
|1 Jan-31 Mar
|1 Jan-31 Mar
|Revenue||€ million||874.6||942.0||– 7.2%|
|Order intake||€ million||1,068.8||841.1||+ 27.1%|
|Orders on hand at 31 March||€ million||1,405.5||1,284.8||+ 9.4%|
|EBITDA||€ million||76.5||89.5||– 14.5%|
|EBITDA margin||%||8.7||9.5||– 0.8 PP*|
|EBIT||€ million||43.0||53.7||– 19.9%|
|EBT||€ million||44.6||53.0||– 15.8%|
|EBT margin||%||5.1||5.6||– 0.5 PP*|
|Consolidated net income||€ million||32.8||39.1||– 16.1%|
|Earnings per share||€||1.04||1.24||– 16.1%|
|Capital expenditure for PP&E and intangible assets||€ million||20.7||34.2||– 13.5 Mio. €|
|Free cash flow||€ million||30.3||– 16.0||+ 46.3 Mio. €|
|Net cash and cash equivalents at 31 March**||€ million||208.2||10.8||+ 197.4 Mio. €|
|Working capital to revenue***||%||28.7||27.1||+ 1.6 PP*|
|Employees at 31 March|
|Outside Germany||6,324||6,602||– 278|
* PP = percentage points ** Cash and cash equivalents less debt
*** Average of last 4 quarters
Letter from the Executive Board
Dear shareholders and friends of Krones,
After more than a year, the corona pandemic continues to be the dominant issue worldwide. The third wave is sweeping across the globe and few regions are so far able to lift restrictions.
But there is good cause to hope that the economy will do better in 2021 than was expected at the start of the year. In its latest economic outlook, the International Monetary Fund (IMF) upgraded its forecasts for economic growth. It is now projecting 6.0% growth for the world economy in 2021. The January estimate had been 5.5%. In April, the German Mechanical Engineering Industry Association also raised its output forecast for the year from 4% to 7%.
Krones likewise expects business to recover this year. Uncertainty about the duration of the corona crisis continues to have an impact on our customers’ investment confidence. But the figures for the first quarter support us in our optimism. Order intake improved by 27.1% year on year to €1.069 million. This confirms the upward trend since the third quarter of 2020. The revenue of €875 million was 7.2% down on the previous year’s figure, which was only partially affected by the corona crisis.
That the cost-cutting measures launched in 2019 and stepped up in 2020 are taking effect is reflected in good profitability. Our first-quarter EBITDA margin was 8.7% (previous year: 9.5%). That is above our target of 6.5% to 7.5% for the full year.
The figures for the first quarter show that there is a light at the end of the corona tunnel. Krones is ready to switch back again from crisis to growth mode. We will benefit here from the recovery of the beverage and packaging market, as well as from our company’s good financial strength and strong capacity to innovate. The focus here continues to be on the sustainability and digitalisation of our products and services in order to meet customer needs in this direction.
Overall, the Management Board is as confident as ever that Krones will emerge stronger from the crisis and meet its forecasts for this year – provided there are no unexpected setbacks from the Covid-19 pandemic.
Report on expected developments
Krones optimistic for full year 2021 after good start to the year
Following the positive first quarter, the company remains confident for the full year 2021. On the basis of the current general economic outlook, we expect the markets relevant to Krones to stabilise in the course of 2021 and to show signs of recovery. Based on this, the company expects revenue growth of 2.5% to 3.5% for the Group in 2021.
Thanks to slightly increasing revenue and the adopted structural measures, Krones will improve its profitability this year compared with 2020. For 2021, the company forecasts an EBITDA margin of 6.5% to 7.5% for the Group. That is equivalent to an EBT margin of 3.0% to 4.0%. For its third performance target this year, working capital to revenue, Krones expects a figure of 26% to 27%.
The guidance for 2021 is subject to the assumption that there will be no severe impacts from the Covid-19 pandemic such as harmful virus mutations or vaccination difficulties. This would hit the economy and hence also Krones harder than currently expected and could lead to negative revenue and earnings effects.