Krones Ag Adr

Good afternoon and a warm welcome to the Crohn's conference call. My name is Olaf Scholz. I'm head of investor relations here at Crohn's. We have had a good start into 2025, and so we continued our profitable growth path. With strong figures and an improvement in all key figures, we published our Q1 results in the morning. But nevertheless, there are also uncertainties in the world which could affect the world economy. Well, that's the situation. Christoph Klenk and Uta Anders will give you more details about these figures and will give you also additional information. After the presentation, you will have the opportunity to ask questions. I think you also know how the Q&A questions work. You can raise your hand over the Teams function or send me just a short email. Additional, please be reminded that this meeting will not be recorded. So please also deactivate any functions of recording at Teams. I think let's start with the presentation. So I hand over to Christoph Klenk. Christoph, the floor is yours. I'm sorry.

Thanks, Ola. Good afternoon. Welcome on behalf of the two of us here. Pleasure to have you here today and give you insights where we are after Q1 and how we see actually the perspective of Crohn's in 2025 and beyond. I can say before I start, we are quite pleased where we are. So the results are good and in line with our planning. And we come to that in a minute. And as always, I skip, let me say, the overviews and we jump immediately into the order intake, which might be one of the important topics where we are with this and how our outlook is in particular under the view of the tariffs we are facing in the US or we might face or might not face. um order intake as you can see at a bit above 1.4 billion we are quite heavy with the number we have achieved here and again in line with what we have discussed here as we said it should be between 1.4 and 1.45 so um quite being at the target with this one we have seen in the order intake already a bit of a slowdown from the us and could compensate that fortunately from other areas in particular from africa middle east and south america so that helped quite a lot um to be there um i mean uncertainty i come to that in a minute after i have spoken on how we are distributed over the world that we talk about the terrorists as well but all in all we are quite happy and if you look further down the road for the next quarters we would see the way that the pipeline is really strong however uncertainty plays a big role into it. And the question is how much is actually postponed or not. So we do expect for Q2 a slightly lower order intake than we see in Q1. Nevertheless, we keep what we have said in terms of that we see that year on year we should have a ratio around one. So that should be the case after 2025. And we are still sticking to that target. If we look to our order backlog, um this has been quite stable and okay so a bit up and down but on a very marginal level we are quite happy that with that backlog we have right now um we can on one hand utilize our capacities until end beginning of q1 q2 next year so that's giving again a very good safety in terms of our plannings. And we know exactly the margins which are in that order backlog. So this is emphasizing even more that for 2025, we have a clear view on where we are in terms of profitability. So all in all, we are quite okay with that one. And if you look to our delivery times, which is one of the issues we have because competition is a bit better than we are. So we have been down at 50 weeks and for some products, we are even a bit better. So things going okay. And we are talking in that regard, of course, all the time X works. for bottling lines and other equipment we are delivering now coming to our distribution around the world i mean markets have been going quite well and you see that the us is on a decline and this time we talk about revenue important it's not order intake we talk about revenue and this is of course more than a i would say a bit offset to order intake of course once we are going to realize the orders Nevertheless, we have anticipated, and that has first of all nothing to do with the tariffs, that the US might be not as strong as it has been in the past, since we have seen that the investment activities already by the end of last year have been a bit going down. But you see on the other side that some of the other areas have picked up quite nicely and that we are heading in the right direction. So all in all, we believe things are quite balanced. There's a bit up and down, but no fundamental change in our markets. One thing is maybe a bit remarkable, that's Eastern Europe, Central Asia, that's going really from, let me say, Eastern Europe to the western border of China, so everything which is in between, without India, of course, that's belonging to APEC, but all these states like Kazakhstan, Uzbekistan, Azerbaijan, and so on, they are all belonging into that region, and this worked quite well. So there have been quite significant investments and seems to be quite stable even in the outlook. Asia Pacific picked up quite nicely, so we are happy with that one in terms of how this is distributed. Nevertheless, mid and long term, we expect much more from Asia. Africa, Middle East is doing fine. We had just this week a review with our management team. There are 17 countries, 70, which we are actually dealing with in Africa. Well said, a couple of conflicts, but nevertheless, still the continent is going okay. And South America, as already said, so was quite good. Now, a few words, and we have no separate slide for North America because we believed there's so much uncertainty in how things are going with the tariffs that we were not, let me say, quite clear on, let me say, what slide we should for the long-term prepare, but just to give you some insights. We have 20% of the revenue, as you see here, on average in the U.S. Half of it, we have local, value creation. So we manufacture half of it in the US. So 10 percent are remaining. And I should say we have one thousand six hundred people in the US. There are several entities processing and into logistics is doing completely independent in the US. And for bottling and packaging, we do the complete lifecycle services. They're independent, including spare parts, which is important because that's the biggest proportion usually which for import. But we're doing spare parts manufacturing completely in North America. Now, if we look to the 10 percent, which we are not manufacturing in the US, you have see that out of this 10 a bit more than half we have no local competition or no bigger local competition this is in particular blow molding filling and labeling these are the majority let me say of the core of our bottling lines where we have more or less limited competition into this. For the dry end, which is packaging machinery, it's around 4% of the revenue that we have competition. And therefore, let me say the tariffs would be to a certain extent critical. Now, fortunately, we have already last year made some significant decisions. One has been that we have been ordering milling and lace machines just to make sure Machinery centers, just to make sure that we can do all the spare parts manufacturing, which we need in the US, we can do there. Those machines are arriving right now in Q2. And since we are manufacturing labeling machines in the US, this will help us to extend the portfolio. So this decision has been made. And of course, we are working on, let me say, the potential decision, which might have to be taken, but I stay very straightforward with the might. We are working on what would it mean in case the tariffs would be higher? Can we do in a reasonable timing, can we shift production from here to the US just to make sure that we are not losing the market? And the answer is yes, since with the labelling machines, we have all the processes in place. And second, this is the other important thing we have already decided last year to extend our facilities there. um we have a quite significant space added to our facilities in the us so we would be even capable of getting the production there without any harm because this is existing right now it's existing buildings which we have um rented and this rent is starting right now so we are moving in for the time being so we would have all the options in the us um just in a nutshell where we are with that so for this year revenue We do believe we are not concerned since tariffs are paid by our customer once they are bottling lines, because this is not in our scope. Once we sell equipment directly from the US, we have already increased pricing. for whatever we do in the US in accordance to what we see because of tariffs and the manufacturing there. And this is already accepted by the customs because we had a huge communication already the last couple of weeks and have the feedback, which so far should be okay for us. So, so far, to let me say the tariffs, I would assume there might be questions later on more in deeps. And with that, I'm handing over to Utah, continuing with the revenue.

Yeah, good afternoon also from my side. I mean, there's always talking about P&L segments first and then talking about everything which is related to the balance sheet. Let's look at revenue. We had a very good start into the fiscal year, as you can see, 1.4 billion euro revenue. which is a 13.1% growth compared to the first quarter of 2024. And I mean, as you have read also in our communications, this is overproportional compared to our guidance because in the first quarter of 2024, there was no net style yet included, whereas now in the first quarter, we have approximately 60 million from net style included and making it on a like-by-like basis, we are in our 7% to 9% guidance, which we had given. I mean, the reasons for the revenue increase is, I mean, as we had said, we have a very good backlog, also with good price quality, then coming later on to EBITDE and overall full utilization of the capacities. And with that, we also confirmed the guidance we had given for 2025 of revenue growth of 7% to 9% for the fiscal year. Moving on to EBITDE and its margin, I mean, as you can see, also here, we had a very good start into the fiscal year, 149.3 million, 19.1% increase, and the margin of 10.6%. And I mean, here, I need to speak about NetStyle also because, I mean, as you know, it has a dilutive effect, and that dilutive effect is approximately 0.2 percentage points. And taking that out, I mean, the increase would have been even higher than it wouldn't have been 10.6%, but a little bit around 10.8%. And why is that? I mean, I talked already about the good utilization of the capacity. I talked about price quality. And so these were the main reasons, but also good mix. And overall, we are confirming our target for the fiscal year of 10.2% to 10.8%. Now moving on to EBIT and of course, as we have said always, this is very similar to the EBIT development. Looking at the overall numbers, 107.9 million EBIT, which we have recognized 21.2% increase compared to last year. And on a margin basis, you can see 7.7% compared to 7.1%. very small financial income only close to 2 million but also that was within the expectations. So that's why also here we can see the start was within our expectations and we also expect to continue like that. Now, moving on to personal and material expense, and let me start with personal expense. I mean, as you can see, we have increased compared to the first quarter of 24, our personal expense by 57 million. And if you look at the ratio, it is 31.6%. And I mean, now all of you remember probably that we are always saying being around 30 is very important for us. And it still remains that sentence, first sentence on that we expect to come into that range again throughout the fiscal year. But let us talk about why are we now at 31.6 and not at around 30. I mean, it's a little bit also timing of the fiscal year. We had Easter in April and Easter is the period where people take vacation. So we still have high vacation, of course. That's one of the reasons. The other reason is also the timing of the tariff increases because, I mean, last year also the increase was April 1st. So there's also some effect from that. But I think the important message is here we expect to come back to a lower ratio than we have right now. Now, the picture is different to material cost. In material cost, as you can see, I mean, 664 million, 44 million only increase, a significant decrease in the material cost ratio. And also here we have several effects. I mean, first of all, the overall statement, we expect this ratio to increase throughout the fiscal year more to a Yeah, 49% level. And why is it that low? I mean, it's also realization of cost savings and material cost we have, but it's also efficiency we have. And it's also to a certain degree, it's also some mixed effects and some timing. But overall, our expectation and also our planning is a higher ratio where in personal cost, it is a smaller one. And all was confirmed also by our latest plannings. Now talking about headcount, I mean, as you can see, 20,600 employees Kohns has employed as of end of March 2025. So that's 204 more than we had end of December 24. So a 2% increase under proportional growth, but still growth. About a quarter of that is service technicians. And I mean, you remember that we have always said we will keep continue or we will keep going in service technicians and everything else is then across the world. And it's also across the functions, digitalization also playing a major role here. If we look at the composition of the headcount, it's more or less the same also looking at what is in Germany, what is outside of Germany. So there is no major change here. But all in all, also looking at the resilience of the company, of course, we're going to slow down the headcount goals, but that had already been talked about also when we did our planning for 2025. Now coming to the segments, filling and packaging technology, the development of this segment is very much like the group development. So starting with revenue, I mean, yes, you can see 150 million more revenue than we had last year, 14.5% in addition, so above the guidance, but also here, NetStyle comes into play. and is one of the reasons, or is the reason why we are above the guidance. Also, I will come to the guidance later. And the reasons are exactly the same I mentioned for the group. And now talking about EBITDE development, I mean, as you can see, significant growth, 23 million compared to last year. And on a margin perspective, 10.9, which is a 0.7% increase. And taking out the dilutive effect of NETSTAR, it is around 1% here, the increase. And coming to the guidance of the segment, I mean, all I said earlier for the group applies here as well. 7 to 9% goes, 10.5 to 11% EBITDA margin. That's what we confirm. Process technology, looking at revenue from 128 to 130, so small growth, 2 million, 2.2%. But we had already guided that the growth in process technology is expected to be only 0 to 5%. So we are within our guidance here, so meeting our expectations and looking at the margin. First of all, EBITDE 14 million, 10.7%. Yes, we are below last year, but we are above our guidance. So we summarize it for us, a very good start also for process technology into the fiscal year 2025. And summarizing it now from a guidance point of view, we confirm also our guidance here. in terms of growth, 0 to 5%. And we also confirm our guidance in terms of EBITDA, 9 to 10%. So like last year, a very good start. First quarter, it's going to slow down a little bit in terms of EBITDA margins throughout the year. last but not least intra logistics 86 million revenue 9 million in addition and so it goes by 12.1 percent the revenue growth expectation or guidance is 15 to 20 percent and i mean you know that the second half of the fiscal year is usually the stronger one for intra logistics so we expect this to happen also in 2025 And looking at the margin and EBITDA, I mean, 5 million, 5.8 percent better than last year. But of course, not of course, still below the guidance. But that has to do also with revenue. And as I said earlier, usually is a strong second half year and we expect the same to happen this year. And so also here we confirm the guidance we had given a 15 to 20 percent revenue growth and six and a half to seven and a half percent EBITDA margins. Now coming to our balance sheet. And first of all, liquidity position in the middle of the chart and equity on the right side of the chart. I will start in the middle. I mean, cash position is very strong again. We had a very good start into the fiscal year in terms of cash flow. So very similar again like we had it last year. And that brought us to a cash position of 592 million. And taking together three credit lines used once brings us to liquidity reserves of 1.443 billion euro. And I mean, yeah, that allows us to go further, allows us to invest, allows us also to deploy the backlog, but also allows us then to grow inorganically when there are options available. Equity ratio and equity in general, 62 million addition to equity and the equity ratio oil and oil stayed more or less on the same level as we had it end of last year. So more or less same growth in terms of equity and balance sheet, total of the balance sheet, the sum of the balance sheet. And now let's look at working capital. I mean, the reason why we are holding that very good cash position is because of the very good free cash flow. And when we look then in the slide thereafter, we will see that there was no change in working capital in the first quarter of 2025. Overall, our working capital remained at 855 million. So that's the total number, which then with the increasing revenue brought us to the share of 17.1%. And we had different developments over the different components of working capital, starting with receivable POC. You can see that we kept it more or less on the same level as we had it end of December 2024. And on an overall level, about 2 billion we are holding here compared to a little bit more than 1.9 million we had at the end of 2024. accounts payable yeah 13.8 percent only compared to 15.4 that tends to be a little bit under proportionate throughout the fiscal year if we look at the overall number also only 756 in comparison to 813 but it's also just we think it's more a timing topic throughout the fiscal year inventory i mean you heard from me um throughout the last course that we had that security inventory security, looking for the word right now, we had built up inventory to have security in the supply chain and you had heard from me that it's our task now and also our plan to deploy that inventory and to keep then the inventory on a stable level and we achieved that also in quarter one. You can see that was the 12.1 compared to 12.9, but more remarkably compared to the 15% a year ago, and the overall number is 660 compared to 682 end of last year. And then received prepayments, 18.5% compared to 17.5% last year. We are holding a little bit more than a billion in received prepayments, which is also a result of the good order intake. So all in all, as I said, stable development here and rather low working capital. Moving on to free cash flow. Yes, some things I have said already throughout the last or over the last slides. So starting first with free cash flow before M&A 165.2 million. Yes, it is lower than last year, 184.2. But still, we believe on a very high level, mainly resulting from cash flow from operating operating activities, as you can see, from a little bit more than 200 million. And you can also see the 0.4 million. That's what I mentioned earlier. No change in working capital. PAPEX is underproportional in the first quarter as it tends to be underproportional throughout the fiscal year or in the first quarter. So with 41.4 million and only 2.9%, but comparably to last year on a comparable level, And that bringing us all to the 165. No major M&A, just the payout of earn out. And then free cash flow reported, as you can see, financing activities, which is lease payments, bringing us then to the 592 cash at the end of the period. We cash flow expectation for the end of the fiscal year. Despite of the fact that we had 165 million in the first quarter, we are holding our expectation, which we said will be around 200 million. And this is why this is because I said, first of all, we expect working capital to increase throughout the fiscal year. And we also expect and have plans for higher capex. And so that's going to balance somehow. with the other cash flow generation pools and so coming approximately to that level. Last from my side, Rossi. 20.5%, so above the guidance we had given of 18 to 20%. And the reason for that is, first of all, good EBIT development. But secondly, also, in particular, working capital still being underproportional. So that's why we are a little bit above our guidance. But also here, we expect to come back within our guidance of 18 to 20%. Yeah, so far from my side.