2020 a satisfactory year despite impact of coronavirus
On 6 May 2021, Chairman of the Supervisory Board Dr Bernd Flohr chaired a second Annual General Meeting by video conference on account of the coronavirus pandemic. Although the 2020 financial year had clearly been affected by the coronavirus pandemic, he expressed overall satisfaction with business development.
Order intake, sales revenue and EBIT were down on the very good prior-year results due to the repercussions of the pandemic. But against the background of a solid order book, measures introduced at an early stage to reduce costs and a very good second half of the year, Flohr was able to give a positive summary of the year as a whole.
The volume of orders received in the 2020 financial year was € 2,143.4 million, € 310.4 million (– 12.6 %) lower than in the previous year. Sales revenue reached € 2,207.9 million, a decrease of € 175.3 million (– 7.4 %).
Earnings were likewise down owing to lower sales revenue. KSB achieved EBIT of € 70.2 million (– 38.2 %), thanks to the prompt introduction of cost-cutting measures. This already includes special factors from impairment losses on goodwill in the amount of € 11.2 million. The company further improved its net financial position by € 58.5 million to € 305.0 million through stringent working capital management.
Given the reduced earnings, shareholders approved a lower dividend than the previous year’s, at € 4.00 per ordinary share (previous year: € 8.50) and € 4.26 per preference share (previous year: € 8.76).
“Despite significantly lower earnings and non-cash impairment losses, we are paying this dividend to our shareholders. We are doing this in keeping with dividend continuity even in more difficult times and because we believe in the company’s long-term earnings capacity,” said CEO Dr Stephan Timmermann.
Dr Timmermann set out in detail the measures that KSB took to minimise the impact of the coronavirus pandemic and to ensure global production chain continuity.
In terms of strategy, the focus was on the successful implementation of the Climb 21 project and on further expansion of the KSB SupremeServ activities. KSB continued to pursue the systematic realignment of the company. By focusing on markets where KSB expects long-term, profitable growth and pressing ahead with the strategic expansion of the service business, KSB intends to take better advantage of the available market potential. Even in such a difficult year as 2020, KSB invested just under € 100 million in new projects, capacity expansion, rationalisation and environmental protection. Other key activities included measures to protect the environment and to ensure sustainability.
Even if the coronavirus pandemic will continue to have an impact in the first half of the year at least, KSB takes a confident view of the 2021 anniversary year. Order intake and sales revenue in the first quarter were significantly higher than in the comparative prior-year period. Order intake in the first quarter picked up again to € 600.1 million (previous year: € 588.2 million). The increase in sales revenue was more pronounced, with a rise of € 21.4 million to € 539.2 million (previous year: € 517.7 million). EBIT also improved significantly as a result of higher sales revenue and cost reductions.