Kardex AG: Media information on the Half Year Closing 2013

22 August 2013, Company News

Kardex AG  / Key word(s): Half Year Results

22.08.2013 06:29

Release of an ad hoc announcement pursuant to Art. 53 KR

Media information to the half year closing 2013

Zurich, 22 August 2013 

Kardex Group

Kardex improves profitability in a challenging market environment

The Kardex Group held its ground well in a challenging economic environment
in the first half of the year. Following a weaker second half in 2012 and a
sluggish start to 2013, at EUR 249.3 million, bookings were close to the
year-back level (EUR 252.2 million). The order backlog of EUR 174.1 million
at the end of June 2013 is 7% higher than 12 months previously and 12.4% up
on the beginning of the year.

The net revenues of EUR 227.3 million generated in the first half of 2013
were 5.2% lower than the sales reported in the strong first six months of
2012 (EUR 239.8 million). Owing to the quality of the orders, operational
improvements and efficient cost management, a satisfactory result was
nevertheless achieved. The operating result (EBIT) of EUR 14.6 million
corresponds to a EBIT margin of 6.4% and is 18.7% higher than last year
(EUR 12.3 million). Net profit for the first half stands at EUR 10.8
million (EUR 9.1 million) and earnings per share came in at EUR 1.40 (EUR
1.17). Return on capital employed reached (ROCE) 22.6%. Despite a payment
of a dividend of EUR 7.4 million to shareholders, the Group's net cash
position increased further to EUR 17.2 million (31.12.2012: EUR 12.4
million). This is thanks to the free cash flow of EUR 12.2 million (EUR
11.8 million). The Group's end-of-period equity ratio increased to 38.9%
(31.12.2012: 36.2%).

Kardex Remstar profits from efficiency improvements 

With sluggish demand in the industrial sector, Kardex Remstar suffered a
decrease in revenues in most markets. Division revenues were down by 4.9%
to EUR 111.5 million (EUR 117.3 million), reflecting the lower backlog of
orders at the end of 2012 and delays in the execution of various more
complex orders. On the other hand, bookings were up 1.7% to EUR 124.0
million (EUR 121.9 million). Accounting now for 28.9% of revenues, the
service business continues to have a stabilizing impact. Kardex Remstar's
operating result of EUR 10.9 million is on a par with the previous year's
level and corresponds to an EBIT margin of 9.8%.

In the first half of 2013, Kardex Remstar successfully launched a valuable
addition to its range: a new vertical carousel for smaller loads. At the
LOGIMAT, Europe's foremost intra-logistics trade fair, Kardex Remstar
showed a further step in the division's development from a product-oriented
company to a supplier of logistics solutions. Designed to further increase
efficiency and enhance customer service, the spare parts centre for Europe
commenced operations at the Bellheim site in July 2013.

Kardex Stow holds margin

Kardex Stow also fell just short of the revenues reported in the year-back
period. At EUR 84.8 million, net revenues were down 4.4% year-on-year (EUR
88.7 million), while bookings were only 2.7% lower at EUR 96.7 million (EUR
99.4 million). The operating result of EUR 4.3 million was only a
marginally lower than the previous year's figure (EUR 4.5 million),
corresponding to an EBIT margin of 5.1%.

As announced, over the past 15 months the Board of Directors of Kardex AG
assessed all the strategic options for locking even more effectively into
Kardex Stow's strong potential. Compared with its competitors, Kardex Stow
is well placed in terms of costs and efficiency, thanks to the highly
automated plant in Belgium, an efficient facility for labour-intensive
tasks in the Czech Republic and an established site in Shanghai. The
products enjoy a solid reputation in the market, which has also led to
greater demand from global OEM customers. However, the high cost of
transporting the final product has so far limited the division's geographic
expansion. The sale (announced on 8 May 2013) to the French-based Averys
Group will open up new prospects for Stow. The two companies are a good
fit, both geographically and product-wise. Thanks to its wide distribution
network and production sites in France, Germany, Belgium, Poland, the Czech
Republic, Turkey and China, the combined group will become a leading
European provider in the industry with annual sales of around EUR 350

Reorganization of Kardex Mlog showing initial successes

Kardex Mlog reported a year-on-year 11.2% decrease in sales to EUR 31.7
million. At EUR 29.5 million, bookings were also just over 10% below the
previous year's figure. However, the decrease was due not so much to market
conditions as to the company's efforts to improve its strategic product mix
and, above all, the risk management. Accordingly, the gross profit
generated by new business is significantly higher than in the first six
months of the previous year. Up 4.5% year-on-year, service sales now
account for 18% (15%) of revenues. Kardex Mlog is well on the way to
returning to sustainable profitability. While the operating result of EUR
0.2 million is still very modest, it is a considerably improvement to the
previous half-year result (EUR -1.3 million). Having been brought up to
full strength again during the first half year, the management team is now
well equipped to further implement the turn-around strategy of Kardex Mlog.

Further improvements in capital management

Receivables decreased by EUR 9.5 million (-10.3%), reflecting not only
lower revenues but also improved and more efficient receivables management.
On the liabilities side, faster payment of suppliers' bills generated
additional early payment discount income. The return on capital employed
(ROCE) came to 22.6% and the return on equity to 26%.

Planned use of cash inflow from the sale of Kardex Stow

The sale of Kardex Stow to Averys was concluded following the go-ahead from
the competition authorities. Kardex will post a book gain of approximately
EUR 10 million on the sale, after adjusting for goodwill of some EUR 23.1
million already written down in accordance with Swiss GAAP FER. The Group
will use the cash inflow of around EUR 76 million (including repayment of
intercompany loans) from the sale primarily to invest in the accelerated
organic expansion of Kardex Remstar and to repay the remaining bank debts
of EUR 10 million.

Furthermore, the Board of Directors plans to use around CHF 30 million for
a special dividend of CHF 4.00 per share from capital contributions. This
is roughly equivalent to the funds generated by the capital increase in
September 2011, which are now to be channelled back to shareholders. Kardex
AG will therefore be convening an extraordinary general meeting for 25
September 2013. Nevertheless, the Group's equity ratio will remain above
50% even after distribution of the special dividend.

Division head and Executive Committee member Jos De Vuyst left the Group
following the sale. The reduction in the Group's size also brought with it
further streamlining at the holding company. Chief Financial Officer
Gerhard Mahrle left Kardex AG in May, handing over his duties to Thomas
Reist, Head of Finance and Controlling. We would like to thank these two
Gentlemen and all employees of Kardex Stow most sincerely for their
commitment to the Kardex Group and wish them all the best for the future.

Cautiously optimistic outlook 

Thanks to the healthy order backlog, the Board of Directors and Executive
Committee are cautiously optimistic about the remainder of the year. Kardex
Remstar should be able to hold its EBIT margin at the previous year's level
despite lower projected revenues. Kardex Mlog is expected to report a
positive result for the year. Even if the economy stabilizes, the Group
remains prepared to respond fast to renewed economic upheavals.

For the full interim report, please go to our website

Please note: Today, 22 August 2013, at 09:00 CEST, there will be an analyst
conference call (conference ID: 4635392) with Executive Director Felix
Thöni, Head of Finance and Controlling Thomas Reist and IR Contact Officer
Edwin van der Geest to discuss the half-year results. To take part, call:
+41 (0)22 592 73 12.

Contact for media and investors:
Edwin van der Geest
Investor Relations
Tel. +41 44 419 44 79
Tel. +41 79 330 55 22

Calendar of events:
12 September 2013                        Company presentation at Investora
                                         Hotel Marriott Zurich
25 September 2013                        Extraordinary General Meeting
                                         SIX Swiss Exchange, Zurich
13 March 2014                            2013 year-end-closing, publication
                                         of 2013 Annual Report
                                         2014 Media and analysts'
24 April 2014                            2014 Annual General Meeting
                                         SIX Swiss Exchange, Zurich

Key figures
EUR millions
1 January to 30 June                    2013              2012         +/-%
Bookings                               249.3 109.7%      252.2 105.2% -1.1%
Order backlog (30 June)                174.1  76.6%      163.0  68.0%  6.8%
Net revenues                           227.3 100.0%      239.8 100.0% -5.2%
Gross profit                            59.8  26.3%       58.0  24.2%  3.1%
OPEX                                    45.2  19.9%       45.7  19.1% -1.1%
Operating result (EBIT)                 14.6   6.4%       12.3   5.1% 18.7%
EBITDA                                  19.2   8.4%       17.6   7.3%  9.1%
Result for the period                   10.8   4.8%        9.1   3.8% 18.7%
Earnings per share (EUR)                1.40              1.17        19.8%
Free cash flow                          12.2              11.8         3.4%
Return on capital employed (ROCE)      22.6%             14.8%

                                  30.06.2013        31.12.2012        +/- %
Net working capital                     74.4              72.1         3.2%
Net cash positions ¹                    17.2              12.4        38.7%
Equity / Equity ratio                   89.2  38.9%       85.4  36.2%  4.4%
Employees (full-time equivalents)      2'111             2'062         2.4%

1) Cash less interest bearing debt Kardex Group - Corporate Profile The Kardex Group is a global industry partner for intra-logistic solutions and a leading supplier of automated storage solutions and material handling systems. The Group consists of two entrepreneurially managed divisions, Kardex Remstar and Kardex Mlog. Kardex Remstar develops, produces and maintains shuttles and dynamic storage and retrieval systems and Kardex Mlog offers integrated materials handling systems and automated high-bay warehouses. The two divisions are partners for their customers over the entire life cycle of a product or solution. This begins with the assessment of customer requirements and continues through planning, realization and maintenance of customer-specific systems. It ensures a high level of availability combined with low total cost of ownership and operation. Around 1 500 employees in over 30 countries work for the Kardex Group. Disclaimer This communication contains statements that constitute 'forward-looking statements'. In this communication, such forward-looking statements include, without limitation, statements relating to our financial condition, results of operations and business and certain of our strategic plans and objectives. Because these forward-looking statements are subject to risks and uncertainties, actual future results may differ materially from those expressed in or implied by the statements. Many of these risks and uncertainties relate to factors which are beyond Kardex's ability to control or estimate precisely, such as future market conditions, currency fluctuations, the behavior of other market participants, the actions of governmental regulators and other risk factors detailed in Kardex's past and future filings and reports and in past and future filings, press releases, reports and other information posted on Kardex Group companies' websites. Readers are cautioned not to put undue reliance on forward-looking statements, which speak only of the date of this communication. Kardex disclaims any intention or obligation to update and revise any forward-looking statements, whether as a result of new information, future events or otherwise. +++++ Additional features: Document: http://n.equitystory.com/c/fncls.ssp?u=FQIDDUHHFT Document title: Media information on the Half Year Closing 2013 22.08.2013 News transmitted by EQS Schweiz AG. The issuer is responsible for the contents of the release. EquityStory publishes regulatory releases, media releases on the capital market and press releases. The EquityStory Group distributes authentic and real-time financial news for over 1'300 listed companies. The Swiss news archive can be found at www.equitystory.ch/news --------------------------------------------------------------------------- Language: English Company: Kardex AG Thurgauerstrasse 40 8050 Zürich Switzerland Phone: +41 (0)44 419 44 79 Fax: E-mail: investor-relations@kardex.com Internet: www.kardex.com ISIN: CH0100837282 Valor: A0RMWK Listed: Freiverkehr in Berlin, München, Stuttgart; Frankfurt in Open Market ; SIX End of Announcement EQS Group News-Service ---------------------------------------------------------------------------