Acquired in 2014, the HOMAG Group reported a 25.8% increase in new orders in the first nine months of 2017. At € 1,078.9 million, it made the largest contribution to the Group’s order intake. Dürr achieved a 27% increase in order intake in the reinvigorated Chinese market to € 556.4 million. Growth was also recorded in other Asian countries and Africa (up 53%) as well as in Europe excluding Germany (up 11%).
The increase in earnings was driven by high capacity utilization, moderate cost of sales and extraordinary income of € 22.9 million from the disposal of Ecoclean. On the other hand, earnings were burdened by purchase price allocation effects for HOMAG (€ -6.5 million) and extraordinary expenses in energy efficiency technology business (€ -4.6 million).
Dürr increased spending on research and development by 10.8% to € 85.1 million in the first nine months of 2017. This was due to the digital@DÜRR digitization strategy among other things. One aspect of this is the ADAMOS Internet of Things platform which Dürr unveiled in September together with Software AG and mechanical engineering companies DMG Mori, Carl Zeiss and ASM. Ralf W. Dieter: “ADAMOS met with a very promising response. The founding companies are in advanced talks with other companies in the mechanical engineering sector also wishing to use ADAMOS. ADAMOS offers an opportunity for mechanical engineering companies: We can jointly advance digitization, learn from one another and cut costs.”
The high earnings after tax caused equity to rise by 16.0% compared with September 30, 2016 to € 869.1 million. The equity ratio widened from 23.4% to 25.9%. At € -22.2 million, the operating cash flow fell short of the previous year (€ 54.0 million). However, it returned to positive territory in the third quarter and should increase substantially in the fourth quarter as well. CFO Carlo Crosetto: “We are observing more restrictive prepayment practices on the part of customers in the automotive industry. However, this does not have any impact on profitability. All it means is that we receive payments from customers somewhat later.”
Following the disposal of Ecoclean, the Group headcount contracted by 1.9% over September 30, 2016 to 14,876 employees. In Germany, where more than half of the roughly 850 Ecoclean employees are based, the workforce fell by 4.0% to 7,853.
Outlook for 2017 as a whole
Following the disposal of Ecoclean, operating earnings of around € 10 million and business volume of some € 150 million have been lost in 2017 since the second quarter. Despite this, Dürr raised the target range for order intake for 2017 from € 3.3 to 3.7 billion to € 3.6 to 3.8 billion in mid-October. The Group narrowed the target range for sales to € 3.5 to 3.6 billion in 2017 (previously € 3.4 to 3.6 billion). Dürr is confident of being able to reach the top end of both new target corridors. Adjusted for the effects from the disposal of the Dürr Ecoclean Group, sales should expand by 3 to 5%. The target EBIT margin range for 2017 is unchanged at 7.5 to 8.25%. As things currently stand, Dürr expects to reach the middle of this corridor. In 2016, the Group reported sales of € 3.57 billion, order intake of € 3.70 billion and an EBIT margin of 7.6%.