29.10.2019

Palfinger continues to break records

Palfinger has published its third quarter results achieving new records in terms of revenues.

Total revenues for the nine months to the end of September were €1.3 billion an increase of 10 percent on the same period last year. This was made up of the Land division which achieved revenues of €1.07 billion, up 14 percent on the year, with an operating profit of €116.2 billion just one percent higher than last year.

The Sea division saw revenues drop a further 14 percent to €142.1 million, while the operating loss was almost halved from a loss of €14 million last year to a €7.7 million loss this year.
Group pre-tax profits improved 21 percent to €107.1 million. While net debt increased eight percent to €576.9 million.

The company has yet to publish its full report so details of the third quarter are scant, however we can deduce that revenues were around six percent higher at €406.6 million, with a pre-tax profit of 32.2 million up 22 percent on the same period last year. The company says that order intake at least kept pace with invoicing and that it has gone into the fourth quarter with a strong order book.

Chief executive Andreas Klauser said: “This strong performance is driven by the new organisational structure ‘Global Palfinger Organisation’ and the restructuring of the Segment Sea. The new organisation is perceptibly strengthening the global structures and cooperation across corporate units. This is helping us to unlock synergies within the group and achieve efficiency gains.”

“Palfinger Sea substantially reduced its dependence on the oil and gas business by extending its focus to other segments such as cruise lifesaving equipment and drove down its structural costs. The successful turnaround enabled this segment to break even in the third quarter of 2019.”

“The joint venture with the Chinese life and rescue boat manufacturer Neptune is opening up further opportunities. With this partnership, Palfinger has established itself as the leading supplier in the Chinese market for lifesaving equipment.”

“In spite of the recession fears, we are confident that we will be able to achieve our growth targets for 2022, when we expect to generate a revenue of €2 billion.”

Vertikal Comment

Overall this is an excellent result from Palfinger, which finally looks to be moving towards sorting out its less than successful venture into the marine business. Its strategy of doing this by focusing on life saving equipment seems a little odd for what is a lifting and material handling business. However if that side of the business continues to grow and prosper it does throw up the possibility to sell that part of the business off and re-incorporate its offshore crane business into the main crane operation and use the funds either to pay down debt or invest in its core business.

The company is forecasting full year revenues of €1.7 billion which it should comfortably exceed, given its order book comments, while pre-tax profits are already close that achieved in the whole of 2018.

As to its plans for €2 billion by 2022, that should be relatively easy to achieve, barring a serious global recession. In fact it given the upsides it has in several areas, such aerial work platforms, the North American operation and the opportunity for loader crane sales growth in a number of markets, it could even achieve that a year early in 2021.