The HOMAG Group, the world’s leading manufacturer of plant and machinery for the woodworking industry and for cabinet makers continued its trajectory of profitable growth with a successful first quarter of 2014. Order intake increased by 6 percent to EUR 229.3 million (prior year: EUR 216.3 million) and order backlog rose by just under 9 percent to EUR 261.6 million (prior year: EUR 240.9 million). In terms of sales revenue, the Group saw a rise of just under 16 percent to EUR 204.8 million (prior year: EUR 176.7 million).
CEO Dr. Markus Flik points out that around EUR 11 million of sales revenue stems from the takeover of all the voting shares in Stiles Machinery, Inc., effective as of February 3, 2014. “We have acquired the leading sales and service organization for machines and production lines for the US woodworking industry. It is on a growth path, just like the overall US market. This direct market access allows us to play an active role in the re-industrialization process in the US and benefit from the growth there even more profoundly.” Even without the Stiles acquisition, the HOMAG Group’s sales revenue would have seen a significant rise of around 10 percent. The Stiles acquisition does not have any impact on order intake. Dr. Flik adds, “the strong order intake in the first quarter reflects our strong presence in Asia and North America.”
The Group also succeeded in further improving its results of operations in the first three months of 2014 “although, after balancing up all effects seen in the first quarter, the acquisition of Stiles burdens the profit for the period with a total of EUR 1.5 million,” a fact emphasized by CFO Hans-Dieter Schumacher. Operative EBITDA before employee participation expenses and before extraordinary expenses improved nevertheless by just over 13 percent to EUR 15.1 million (prior year: EUR 13.4 million). A fall in the tax expense ratio to 36 percent (prior year: 47 percent) increased net profit for the period after non-controlling interests to EUR 2.5 million (prior year: EUR 1.8 million). This results in earnings per share of EUR 0.16 (prior year: EUR 0.12).
As of March 31, 2014, HOMAG Group’s headcount rose to 5,410 employees (prior year: 5,031 employees), which is primarily attributable to the additional 324 employees from Stiles.
For 2014, the HOMAG Group has confirmed its existing forecasts. Under these forecasts, the Group aims to further increase order intake to between EUR 760 million and EUR 780 million (prior year restated: EUR 734 million). Group sales revenue is budgeted to increase to between EUR 860 million and EUR 880 million (prior year: EUR 789 million). Sales revenue growth of a mid-single-digit percentage will result from the Stiles takeover.
In 2014, we expect our operative EBITDA before employee profit participation expenses and before extraordinary expenses to range between EUR 82 million and EUR 84 million (prior year: EUR 76 million) and the Group to return a net profit for the year ranging between EUR 20 million and EUR 22 million (prior year: EUR 18 million). There will, however, be no material impact on these two key performance indicators in 2014 from the full consolidation of Stiles as the additional contribution to profit and the consolidation and purchase price allocation effects together with the acquisition-related costs at Stiles are expected to roughly balance each other out or the effects will place a slight burden on earnings. We anticipate a positive contribution to earnings from the acquisition as of 2015.
Source: HOMAG Group AG
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