Kardex AG: Year End Result 2015 / Positive developments for the Kardex Group
10 March 2016, Company News
EQS Group-Ad-hoc: Kardex AG / Key word(s): Final Results
Media information - Year End Results 2015
Zurich, 10 March 2016
Positive developments for the Kardex Group
The Kardex Group is looking back on another successful year. Both its divisions have benefited from robust markets, increased revenues and recorded positive profitability. Kardex Remstar is continuing its dynamic growth and reported a strong increase in demand from the USA in particular. Kardex Mlog harvested the fruits of its restructuring, recorded positive developments in all its segments and achieved the set margin targets. The operating result (EBIT) at Group level exceeded the 10% margin.
Significant currency influences
The annual result for 2015 incorporates significant currency effects. Bookings and consolidated revenues for Kardex Remstar were positively influenced by the strength of the US dollar against the euro, while costs converted into euros, which were incurred in US dollars and Swiss francs rose noticeably.
Healthy growth and improved operating result
At EUR 350.1 million, bookings by the Kardex Group were considerably above the previous year. This represents an increase of EUR 41.2 million or 13.3%, currency adjusted the growth amounts to 9.3%. Revenues of EUR 338.5 million exceeded last year's figure by 9.9% or 5.9% currency adjusted. Order backlog has increased in both divisions and is also clearly above the previous year at EUR 124.3 million (EUR 107.8 million). In line with turnover expansion, profitability increased at an over-proportional high rate. The gross margin reached 36.0% (33.4%). Currency adjusted, the operating costs for sales, marketing and administration were up 7.5% on the previous year. The operating result rose by 27.4% to EUR 36.3 million (EUR 28.5 million), which equates to a two-digit EBIT margin of 10.7% (9.3%). Although the tax level has increased to 20.8% (16.8%), it is still moderate. The annual profit of EUR 28.5 million achieved exceeds the previous year's result by 19.7%. Return on capital employed (ROCE) at 45.2% is well up on the previous year again (33.4%). The Group's headcount increased by 2.0% or 29 full-time equivalents since the beginning of the year to 1 509 employees.
Positive development in both divisions
Kardex Remstar reported its best financial year to date, even though not all markets developed as expected. The strongest growth boost at nearly 9% in local currency came from the USA. While demand from central and northern European countries was good, southern Europe was still weak and growth in Asia was less than expected. The systematic investments in marketing and sales led to an 11.6% increase in bookings to EUR 280.4 million and a 9.0% rise in turnover to EUR 273.7 million. Despite the associated additional expenditure and more intensive efforts in software and product development, Kardex Remstar achieved an operating result of EUR 35.6 million (EUR 28.6 million), equivalent to an EBIT margin of 13.0% (11.4%).
After a demanding phase of refocussing and restructuring, Kardex Mlog is back to profitable growth. The business model adjusted in 2012 is increasingly proving its worth both in the market and in the strong increase in earnings. There was strong demand for efficient storage and retrieval systems and for the refurbishment of existing systems and services. This is reflected in a strong boost to growth and the achievement of the targeted profitability level (EBIT margin 4-6%). Overall, the result was an increase in bookings by 20.7% to EUR 69.9 million, revenues of EUR 64.9 million (+11.7%) and an operating result of EUR 3.3 million (+73.7%).
Healthy balance sheet despite high dividends
The balance sheet of the Kardex Group is solid with no debts and no potential depreciation risks due to goodwill or capitalized tax loss carryforwards. The equity capital remains at a comfortable 58.7 percent (31/12/2014: 59.4%). The Group's capital is efficiently employed, net working capital could be reduced from EUR 56.9 million to EUR 51.4 million despite increased volumes. Due to the high free cash flow of EUR 42.7 million, the cash level increased to EUR 112.3 million (+EUR 27.2 million since 31/12/2014). This despite the fact that the payout rate was increased in 2015 and, as a result, dividends of CHF 2.30 per share or a total of EUR 16.9 million was paid out to the shareholders. The financial reserves provide the flexibility required to avail of targeted opportunities to further strengthen the market position.
Increased payouts to shareholders again
The Board of Directors will propose to the General Meeting a payout of CHF 3.00 per share (CHF 2.30) to the shareholders. The payout will take the form of a reduction in the nominal value. The current nominal value of Kardex shares is CHF 10.35, which still leaves margin for further tax-free payouts.
Separation of strategic and operative management
The current management structure, with an Executive Director managing the Group at an operational level via an Executive Committee, was introduced in line with the reorganisation of the Kardex Group 2011 and has proven successful. Since then, the strategic direction has been successfully implemented. It has given the Kardex Group and its two divisions, Kardex Remstar and Kardex Mlog, the necessary stability for economic success.
The Board of Directors now wants to effect the complete separation between strategic and operative management again. Consequently, the function of the Executive Director will be dissolved as of the General Meeting, but continuity will still be ensured. In his new role as acting Vice Chairman of the Board of Directors, Felix Thöni will form an important link between the management and the Board of Directors.
Jens Fankhänel, Divisional Manager of Kardex Remstar since 2011, is additionally taking over responsibility as CEO of the Kardex Group as of 1 May 2016. Thomas Reist, formerly Head of Finance & Controlling for the holding company, will be appointed as CFO of the Kardex Group as of 1 May 2016. Hans-Jürgen Heitzer, Divisional Manager of Kardex Mlog, will continue to complete the Group
The Kardex Group continues to expect long-term growing demand for intra-logistics solutions and wants to fully exploit the opportunities available on the market. Both divisions are in a good position: Kardex Remstar as the global market leader in its segment and Kardex Mlog as the leading provider in attractive niche markets. The Group has further growth potential both with respect to new applications for their product and logistics solutions and from a geographical perspective. Its stable service business also makes it well equipped to face economical fluctuations. The Board of Directors and the Executive Committee are therefore confident about the further development of the company despite the restricted visibility of its business development.
Contact for media and investors
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.
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.
End of ad hoc announcement
Document title: Year End Results 2015_Kardex Group
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