Krones Ag Adr

Okay, good. Good afternoon and welcome to the conference call of Cronus. Cronus significantly improves revenue and profitability in the first three quarters 24. This was the headline of the press release we published today morning. Now we would like to present you all the figures and give further details about this first nine months of the year 24. after the presentation by christoph clank and utah anders you will have the opportunity to ask questions i think you also know how the q a session works please use the function raise your hand in teams or send me just a short email and then i will hand over to you additionally please be reminded that this meeting will not be recorded and that is also not allowed to record the meeting please also deactivate any functions of recording at teams so i would say let's start with the presentation so i hand over to christoph clank christoph the floor is yours thanks a lot yeah warm welcome today good morning and good afternoon to the audience buddha and myself are happy to have you here today and are happy to present the q3 numbers of crowns um as always

We jump immediately into the presentation because the summary you anyway have seen already and we go in any detail by the next slides to come. Here are the major numbers of Q3. And here we jump into the order intake. And first of all, we are quite happy where we are. The 1.3 billion order intake in Q3 was in line with our expectations. And it's on the same level as the previous year. where we are very happy about. And if you look to the nine months we have as order intake with the four point one billion, we are as well in line with what we have expected and predicted after Q2. The book to bill ratio is above one, which is important in those times. I think we will most probably discuss about that more. I can say the markets and this is said with all the considerations we have made over the last weeks and with discussions we had with our customers our markets are still robust that's the important message i want to send and the investments of our customer continues and this is based on what we see in the inquiries and thus what we have in the pipeline and is based on the discussions we had with the big key accounts to understand their investment schemes they are putting up for the next month and for the next year. I think all the rest we can most probably discuss later on in the Q&A if there are deeper questions to the order intake you might have. If we jump then to the order backlog we have, which has further increased slightly. I mean, if you compare to last year, it's up by six percent. However, I can say that the mix has changed a bit of the backlog because we have executed, let me say, machines built here in-house and they delivered x work so we have a bigger proportion now on the services to be executed to install those lines and that they are commissioned so there's a bit of a change and that's the reason why we are have decreased our x works delivery if you look to we have we are coming from 70 weeks in the past and we are down to 50 weeks 52 sometimes, sometimes a bit less. But this is the average we have right now at the 50 weeks, which was very important for us that we get competitive in the market because some of our competition had shorter delivery times. So that's an important achievement. Once was, of course, with the, let me say, optimized and with better processes executed in new machines that we got more through. without significantly increasing the capacity, without increasing significantly the capacity. And on the other hand, it's a bit of a shift into, let me say, aftermarket and installation. So that's important message. Second important message was the order backlog, which we have is we have from today's perspective until the end of 2025. a capacity utilization and this is very important if we look to next year that we have already a quite good view on how we can drive 2025 forward for crowns and have a for the today's situation a very good planning security how we see 2025 um next slide is about the split through the markets no significant change from what you have seen nothing in particular to explain i mean two things i want to highlight here number one is the eastern europe central asia number we have right now it's seven percent which um historically might be the highest we ever had those markets from let me say from eastern europe and it's going into kazakhstan um It's not including the Southeast Asia area, but all the rest in the middle. below Russia. I mean, this was working quite well. We are quite happy where we are with that. So those areas are at the moment really performing well. That's maybe one highlight. And then, of course, we have to look to North America and Central America. And we are all waiting what the outcome of the election will be, which we will see hopefully the next couple of days. We have played through, let me say, the possible outcomes of that. Nevertheless, I mean, we can't foresee everything, but as I said, we have played through most of it and are hopefully well prepared. So that's for the time being, in a nutshell, overview of order intake and order backlog and the split of revenue we have right now and then over to Uta.

Thank you, Christoph. Good afternoon also from my side. As usual, I will continue with revenue development. And as you can see, we had a strong third quarter with a bit more than €1.3 billion order intake, which brings us then to close to €3.9 billion revenue after nine months. And I mean, as you can see, 11.2% growth. And you remember that we have said in Q1 and Q2 call that our growth throughout the fiscal year will increase and we are showing that this is the case. Talking about net style, I mean, net style has been included in quarter two and quarter three, close to 100 million euro revenue for the two quarters. And if you look at the growth, 11.2 percent net style contributes here with about a little bit more than two percentage points. With our 11.2, we are within our guidance. Remember, we had said net style is part of our guidance. And we are also confirming our guidance of 9 to 13 percent growth. I mean, with the 11.2 and with the outlook we have right now for Q4, we believe that we will be rather at the upper end of the guidance. Coming now to EBITDA. Also here we had a strong quarter, 134.9 million. The quarter itself was a 10.2% margin and comparing it also to the last, to the Q3 of 2023, significant change from 9.5 to 10.2%. And now looking at the overall numbers, as you can see, 391.1 million EBITDA, which was an increase by close to 18%, and from a margin perspective, 10.1%. And as you can see, 0.6 percentage points increase compared to last year. And that is despite of the fact that we had higher new machine sales share in our revenue, and also despite of the fact that net style has some dilutive effect, which is about 0.1 percentage points. And as we have also said in previous calls, the price increases which we have done in 2021 and 2022 cover all the cost increases which we had in the past, but which we will also have going forward in particular for payroll. And we also confirm here our guidance of 9.8 to 10.3% EBITDA margin. Continuing on with EBT, Also here, strong quarter with 89.9 million and compared to quarter three last year, 15.6 million in addition, 0.4 percentage points, bringing us to 275.6 for the nine months and the 7.1% margin, so above 7%, which some of you may remember from previous times also. And also in the numbers are included farm quarter 2 still 4.5 million won of farmer taking into income and earn out obligation which we had. And also here, our margin is in line with our expectations for 2024. Yeah, and now coming to personal cost and material cost as the major components of our cost base. I mean, personal cost, as you can see, significant increase from an overall perspective by 133 million, 1.168 million. billion personal expense as you know we always say being at around or below 30 percent is important for us here and we are here at 30.0 percent we had been after q2 at 30.3 so a slight decrease also coming just from performance and looking at material material cost um 146 million in addition compared to last year, but also here 49.1 percent ratio. And that's despite of the fact, as already mentioned, that we have a higher new machine share in our revenue base. Employees, yeah, as you can see, we have We have broken the threshold of 20,000 employees in September. So Coons as of September employs 20,025 people, which is a little bit more than 1,500 in addition compared to end of December 2023. If I look at the additions, half of it comes from NetStyle plus additional service engineers plus digital community. So that makes up half of the increase. And the other half comes just from recognizing our order backlog and just recognizing the higher business volume, which we have. Looking at the breakdown, Germany compared to West or outside of Germany, I mean, it's the same breakdown as we had in quarter two and compared to end of last year, the change is that we have now a smaller share in Germany because of the acquisition of Netzteil. But all in all, no change to compare what we had also for quarter two. Now coming to the segments, first of all, filling and packaging technology as our major segment. And of course, it follows group development overall, looking at revenue 3.277 billion after nine months, 13.8% growth, EBITDA margin or EBITDA 342, significant increase in absolute numbers compared to last year from volume. But you can also see that with our 10.4%, we have 0.1 percentage point higher margin compared to last year. And also here we have a dilutive effect from NetStyle included 0.2 percentage points approximately. And also here we want to mention that in general we have a higher new machine share in these numbers. We confirm our guidance here, which is 9 to 13 percent in revenue growth. Given the fact that we are at 13.8, we will be rather at the upper end and for EBITDE 10.3 to 10.8. Continuing on with Polaris' technology, as you can see, 378 million euro revenue, which is an increase by 40 million, 11.7%. And we have in mind that last year, AMCO was only included four months. Now we have nine months included. Coming to the EBITDE, 36.4, 9.6 percentage point margin. You can see that we have quite a significant increase coming from volume, first of all, but also then coming from margin. And this is not only coming from AMCO. Also without AMCO, the contribution or the EBITDE margin of the... segment would have been much higher than last year. And looking at the guidance, 15% to 20% is our revenue guidance. We will be rather at the upper end there with all what we know right now. For EBITDA, we believe that we will be rather at the lower end for revenue at the lower end and for EBITDA margin on the upper end. Intralogistics, last but not least, 220 million Euro revenue, so a decrease by 46 million. Here we had quite strong first nine months last year, but we expect then to have a very strong fourth quarter, then also coming to our guidance. And on the margin, you can see 12.4, 5.6 percentage points. So it's to remark here that despite of the fact that we had much lower revenue, we were still able to increase the margin by 0.6 percentage points, confirming all the measures we have taken in the last years. Looking at the guidance, 5% to 10% is ambitious for us, and EBITDA margin 6% to 7%, we will achieve that. So far for earnings, now let's come to cash and liquidity. I mean, as you can see, very strong and stable cash position and overall liquidity position, 305 million euro cash we were holding as of end of September and bringing us to 1.159 liquidity reserve. And then coming to equity, I mean, as you can see, we have increased equity by 120 million. in the first nine months, which is, of course, to a major extent driven by net income, a little bit more than 200 million, then paying out the dividend and then a very small contribution negative just from neutral effects going into equity. All in all, you can see that the over-proportional equity increase by 120 million and the under-proportional increase of our total assets and liabilities, they stayed more or less at 4.5 billion. After nine months, we were able now to increase significantly our equity ratio to 40.5%. Working capital also here stable development 17.1 percent compared to last year 17.3. If I look at the overall numbers we will see that later on the free cash flow statement we have increased throughout the fiscal year working capital by 188 million and looking at the different components of working capital you can see also in these numbers that we are executing our backlog. So that means we are also utilizing the down payments we had on the liability side and now netting them, if you want to say that technically, with the asset side. That was the reason that our balance sheet sum didn't change a lot. But that's also the reason, looking at our receiver with POC, that we are now at 37.1%. Overall number didn't change a lot compared to end of December. Payable is also here. I mean, overall total number didn't change a lot. And of course, with higher revenue and average, payable share decreased to 14.2%. Inventory, you may remember that we had said that this is a focus point for us to make sure that the safety stock we had built up is now on a stable level and with further potential for reduction. Overall, the absolute number is more or less the same and with revenue increasing, the share decreases. And received free payments, actually here we have The highest change, they are lower by 120 million, and that bringing the share to 18 million. And one more time, change in working capital, 180 million, which you also see here now in the cash flow statement. Looking first of all at the first nine months, I mean, you can see earnings contribution other non-cash changes, depreciation, then you see the change in working capital. Cash flow from operating activities, very strong. CapEx being a little bit under-proportionate, as we always have it in the first nine months. And then coming to free cash flow without M&E, 145 million. And then M&E activities, that is mainly net style and including then financing activities, others, which is mainly the dividend, bringing us then to a net change in cash. of 140 million and cash at the end of the period, 305 million. Just a short comparison to the nine months period of last year. I mean, the major change comes from change in working capital because you can see that there is 160 million difference between the two years. And the other major change, of course, comes from the earnings before taxes. Free cash flow, looking at the multi-year period, as you have seen from us over the last periods already, I mean, you see our 145 million. And we had said in all calls of 2024 that our expectation for 2024 is a free cash flow before M&E of about 200 million. So we expect another strong fourth quarter. And we are also confirming the 200 million. Return on capital employed, I mean, as always, it's a result of EBIT development and average capital employed development. Overproportional EBIT development brings us to a capital employed of 18.3%. And so also within our guidance given of 17 to 19%, and which we are also confirming. Then continuing on to the outlook.