KSB Group: Growth in order intake despite negative currency translation effects
FRANKENTHAL: Adjusted for exchange rate effects, order intake and sales revenue in the KSB Group in the first six months of 2018 increased by + 6.3 % and + 1.1 %. Key drivers of the order intake were customer purchase orders from the industry, mining and construction sectors.
Changes in exchange rates in the first half of the year had a reducing effect on factual order intake and sales revenue values. Taking into account currency translation effects of € 61.9 million, KSB achieved a consolidated order intake of € 1,194.6 million, up € 12.6 million (+ 1.1 %) from the comparative prior-year period. At the same time, orders on hand rose by 9.6 % to € 1,413 million. This covers a production period of around eight months. KSB continues to anticipate a tangible improvement in the order intake for the 2018 full year, primarily due to an upturn in business with standard products, support services and spare parts.
Due to currency translation effects of € 51.0 million, consolidated sales revenue amounted to € 1,054.5 million (- 3.6 %). For the 2018 financial year, we expect a moderate rise in sales revenue.
As well as provisions for a legacy project in the United Kingdom amounting to € 25 million, which KSB already reported on in May, the currency-related decline in sales revenue contributed to a reduction of EBIT to € 21.4 million (first half of 2017: € 57.1 million). This dragged down earnings before taxes (EBT) from € 52.5 million to € 16.7 million. Based on these earnings figures,
KSB expects EBIT for the 2018 full year to fall considerably short of prior-year levels.
Under completely new management in 2018, the KSB Group is currently stepping up its activities in the service market, in which the company sees the greatest opportunities for growth and returns. In May this year, KSB launched its own brand (“KSB SupremeServ”) for service and spare parts to exploit this sales potential. The service business is being developed and expanded on a worldwide basis with new service centres, independent sales and distribution, service academies and the implementation of a new logistics concept.
Note: The full half-year financial report can be viewed at www.ksb.com/ksb-en/Investor-relations/Financial-Reports/Half-year_financial_reports.