Weaker economy dampens order intake
In fiscal 2019, the Homag Group was able to maintain sales revenue almost at the high prior-year level. By contrast, the weaker economic and industry situation made itself felt in order intake and earnings.
According to preliminary figures, sales revenue of the Homag Group in fiscal 2019 amounted to EUR 1,279 million (prior year: EUR 1,298 million). As of December 31, 2019, the order backlog amounted to EUR 546 million (December 31, 2018: EUR 602 million) and order intake dropped significantly to EUR 1,220 million (prior year: EUR 1,337 million). As of December 31, 2019, the company employed 6,569 people (December 31, 2018: 6,593).
The EBIT is characterized by the one-off expenses for the structural measures decided in November 2019 to secure the future, which include the shutdown of production at the Hemmoor location. "We are repositioning ourselves with numerous measures", explains Chairman of the Management Board Pekka Paasivaara. "In this way we want to optimize our internal structures and processes and increase our efficiency in order to be best prepared for the next upturn. Including one-off expenses, EBIT fell to EUR 46.2 million (previous year: EUR 94.9 million). Even without these non-recurring expenses, operating EBIT fell by 13 percent to EUR 82.8 million. The main reasons for this included the weak market environment and capacity utilisation deficits.
"In 2019, there was a pronounced calming of the market in business with the furniture industry," emphasizes Pekka Paasivaara. "In Germany in particular, order intake fell noticeably following the high investments of previous years. In other regions, demand was roughly at the prior-year level.
In contrast, capital expenditure in the Homag Group remained almost constant at EUR 41.8 million and mainly related to digital and IT projects as well as measures to improve productivity.
again, the Homag Group intends to impress its customers with a comprehensive
range of solutions. Paasivaara: "One of our key topics is the organization
of skilled trades in the digital age. The focus is on practical solutions that
make the everyday work of carpenters and joiners easier and increase the
efficiency of the companies. In addition, we offer digital assistants from many
areas that provide real benefits and added value".