In the wake of the financial crisis last year, the beverage filling and packaging machinery manufacturer came up against a slump in demand. Consolidated sales for the full year were down 22 per cent on 2008 to €1,865m and the company recorded its first loss in nine years of €34.5m.
Recovery
As the economic picture stabilises and financing conditions improve in the beverage and packaging industries, Krones has reported a significant recovery in H1 sales and profitability.
Sales climbed in the first six months of 2010 by 16.4 per cent to €1,076.2m and growth in the second quarter accelerated to 22.8 per cent.
And in terms of profitability, reported earnings before taxes (EBT) from January to June 2010 were €32m compared to a loss of €15.8m for the equivalent period last year.
Commenting on the results, Krones chairman Volker Kronseder said: “We had a strong first half, generating sales and new orders figures that, in all honesty, none of us thought possible at the start of the year.”
Forecast
For the 2010 business year as a whole, Krones now expects to deliver sales growth in the upper portion of its 10 to 15 per cent forecast range. This would take the top line up to between €2.10bn and €2.15bn. As for profits, Krones said it is now “highly probable” that second half earnings will now exceed the figure for the first six months of the year.
Contributing to this confidence is the improved state of the order backlog, which at €917.2m at the end of June is €130.2m up on the equivalent period last year.
Kronseder said: “Despite the economic uncertainties, our comfortable orders backlog and strong market position makes us confident that we will achieve our targets for 2010.
“With capital investment among our customers picking up considerably now, we expect this fall’s international trade fair season to lend additional momentum for the remainder of this year and the next year.”
Krones said that it now expects the upturn to continue in 2011, assuming there are no major changes to the economic and financial environment.