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.