Dear shareholders and friends of Krones,
Since we revised our guidance at the end of the first half year, general economic conditions have further deteriorated. The tough wrangling over Brexit and the trade war that has been simmering for months between China and the USA are currently having an impact on the general economic environment. As a result, the International Monetary Fund now expects the global economy to grow by just 3.0%. The forecast had stood at 3.3% in April and 3.5% in January.
Despite the political uncertainties, our orders and revenue developed positively in the third quarter. Revenue exceeded the billion euro mark in the third quarter and was up 7% year-on-year in the first nine months, at €2,890 million. Order intake was slightly higher than the previous year at €2,958 million.
Nevertheless, 2019 is not an easy year for Krones. To deliver long-term, profitable growth, we must improve cost structures, raise efficiency, review our portfolio and create new growth momentum. We have already launched short and medium-term structural measures in the past few months.
This package of measures does not yet show through in our third-quarter profitability. Overall, the earnings before taxes (EBT) of €61.4 million in the first nine months and the EBT margin of 2.1% fall short of our expectations. The main causes are high material and labour costs and temporarily weak demand in the PET and the after-sales business. We have already developed and introduced measures in these areas. Following the second-quarter loss, the earnings situation eased slightly in the third quarter, partly because the PET business, which is important to Krones, has stabilised since mid-year.
For the full year 2019, Krones continues to expect revenue growth of 3% and an EBT margin of around 3%. The guidance for the EBT margin does not include any costs of structural measures.
Without any doubt, the company is currently in a challenging and, for Krones, unusual situation. I am nevertheless firmly convinced that the opportunities far outweigh the risks. We are the market and technology leader in a globally growing market. The task now is to continue implementing the structural aspects together with our strong world-wide team.