KSB Sales Revenue at Previous Year’s Level
After five years of continual growth, the order intake of pumps and valves manufacturer KSB was down again for the first time from January to June 2009. In this period, the Group won orders worth € 1026.9 million, which was € 134.1 million (-11.5 percent) down on the same period in the previous year.
The fall in order intake was especially notable among the Group companies in Europe (–13 percent); the order intake of KSB AG (–9.9 percent) was comparatively more stable on a European scale.
At € 936.3 million (+ 0.3 %), the KSB Group has reached the sales revenue level of the strong previous year. A major factor behind this development was the business of equipping large plants in the energy, water and waste water sectors, which continued to be good despite the economic crisis. Markedly weaker growth was seen in sales revenue from the standard products business in the Industry and Building Services segments, which is more directly affected by economy-related fluctuations in demand.
At the end of June, the KSB Group posted a further increase in orders on hand worth around € 1040 million (end of 2008: € 950 million). The orders to be processed are mainly for the equipment of power plants until 2011.
In the first half of 2009, KSB achieved consolidated earnings of € 67.5 million before taxes (previous year: € 85.3 million). The 20.8 percent decrease in earnings is the result of increased pressure on prices in the market, higher personnel costs and reduced capacity utilisation. The return on sales at the halfway point in 2009 was 7.2 percent (previous year: 9.1 percent).
The financial situation of the KSB Group remains very sound. In the first six months, the equity of the Group rose to € 640.7 million; the equity ratio now is 43.0 percent. The interest-bearing cash value exceeded the financial liabilities at the end of June by € 113.5 million.
As already reported, KSB assumes that the current year will show a substantial fall in order intake. The short-cycle standard business will be harder hit by this downturn than the project business, which may likewise weaken in the second half of the year.
Sales revenue in the whole of 2009 will probably be below that of the previous year. As things stand today, therefore, the consolidated earnings before taxes are expected to fall well short of the record year of 2008 (€ 200.1 million), despite the measures taken to reduce costs.
Source: KSB SE & Co. KGaA
