09.08.2017

Wacker Neuson breaks records

Telehandler, loader and light equipment manufacturer Wacker Neuson has posted record first half and second quarter results.

Looking at the first six months, revenues were up nine percent to €763.7 million with European sales up six percent to €555.7 million, the Americas up 20 percent to €184.8 million and Asia Pacific down 10 percent to €23.2 million. Sales of Compact Equipment, which includes telehandlers, increased 10 percent to €404.6 million. Pre-tax profits for the six months were 14 percent higher at €53.9 million.

In the second quarter revenues were 11 percent higher than the same period last year at €425.2 million, with European sales rising four percent to €307 million, while the Americas jumped 32 percent to €104 million and Asia/Pacific rose 65 percent to €13.7 million. Sales of new Compact Equipment were 13 percent higher at €228 million. Pre-tax profits in the quarter were 29 percent higher at €40.8 million.

The company has increased its full year revenue forecasts by five million to between €1.45 and €1.50 billion.

In one of his last duties as chief executive Cem Peksaglam said: “In our largest market, Europe, which currently accounts for around 73 percent of revenue, the group reported a six percent rise in revenue compared with the previous year. Revenue gains were higher in the Americas where we reported a 32 percent rise in revenue for the second quarter and an increase of 23 percent for the first six months of the year. We are particularly pleased to see strong growth in compact equipment, especially with our skid steer loaders, wheel loaders and telescopic handlers. We have also made further progress on expanding our dealer network.”

“Our light equipment business is developing particularly strongly at the moment. Worksite technology is leading the way here, with products such as generators and light towers performing especially well in North America. We are also seeing strong results from compaction technology, in particular with products connected to our alliance with Hamm.”

“In contrast we reported a drop in revenue in Asia Pacific which represents approximately three percent of our revenues. The decrease is primarily linked to a one-off effect in the first quarter of 2016 involving dealers in China stocking up on compact equipment, which increased the baseline for comparisons. Business in Australia and New Zealand showed double digit revenue growth for the first half of 2017. In the second quarter of 2017, revenue increased by 65 percent in Asia-Pacific.”

“The company is making good progress on our new factory near Shanghai, and reflecting our strategy to extend our international reach, we recently entered into two long term distribution partnerships. In South Korea, we have teamed up with Everdigm, a manufacturer of construction equipment, mining equipment and special vehicles, while in Japan, we have started a distribution partnership with Iseki, one of the largest agricultural equipment manufacturers for tractors, agricultural machines and gardening equipment.”

“The strategic alliance between the global market leader for agricultural machines, John Deere, and group member Kramer, which was announced in July, puts the company on course to further expand its compact agricultural equipment footprint in Europe.”

“We are positive about the second half of 2017 due to the healthy order situation and positive mood across all key markets. In Europe, we expect the construction industry to continue on its positive growth path and demand in the agricultural sector to rise. In Americas, we expect the strong performance of the first six months to continue, fueled in particular by business with compact equipment. The second half of the year got off to a great start.”

Vertikal Comment

An excellent set of results from Wacker Neuson which is really gathering momentum as it expands its compact equipment business. Cem Peksaglam hands over the role of chief executive to Martin Lehnerm tis month, with his contract having expired. Hopefully he had dragged everything forward to go out on a high - just joking! - It is certainly a great way to leave the company and hopefully Lehnerm will maintain a steady hand and keep things rollingaking as they are for the moment while he gets to know the business.

The comapny has a great deal more potential for growth, particularly in the telehandler market, given the strong reputation its compact models are winning. If it steadily adds larger models to the product line it could easily pick up market share from the second tier manufacturers such as Bobcat, Faresin and Dieci, while its agreement with John Deere in the agricultural market has some good potential to take market share from some of the major players.

Barring any crazy surprises expect the company to come in at or near the top of its new forecasts.