26.03.2021

Solid result from Wacker Neuson

German construction equipment manufacturer Wacker Neuson has posted its full year 2020 results.

Revenues for the 12 months were €1.62 billion, just 15 percent below that achieved in 2019. Most of the decline came in the Americas where revenues dropped 41 percent to €270.4 million. At the same time European sales declined six percent down on the year at €1.29 billion, while Asia Pacific revenues were 12 percent lower at €55.4 million.

Looking at the breakdown by main product type, the light equipment division saw sales drop 28 percent to €352 million, while compact equipment - which includes telehandlers and excavators etc - were 17 percent lower at €879 million. Services actually increased by four percent to €399 million. Pre-tax profits plummeted 61 percent to €53.8 million. Net debt at the end of the year was at its lowest level since 2011 at €137.9 million, a 68.6 percent reduction on the year.

The fourth quarter showed a further pick up with revenues falling just over 10 percent to €428 million, although all of the decline came from the Americas where sales dropped 46 percent to €61 million. Europe remained flat at €348.3 million, while Asia Pacific was just 2.5 percent lower at €18.6 million.

Interim chief executive Kurt Helletzgruber said: “Covid-19 presented all of us with sizeable challenges over the past year, and the pandemic is far from over. Nevertheless, all signs are pointing towards renewed growth in 2021 and we are very confident about the coming weeks and months. Our customers are busy, and our order books are well filled. We worked hard on improving efficiency levels across the entire Group last year. We are not yet where we want to be, but I am very optimistic about the development of our profitability for 2021 and beyond.”

“In addition to the continued negative effects of the coronavirus crisis, the executive board feels that the supply chain in particular is currently a source of risk. The situation in many areas is already under considerable pressure due to the restrictions caused by the pandemic and the overall uptick in demand. In addition, the group is facing sharp increases in procurement prices, for example for steel.”

Vertikal Comment

Overall, this a very good result from Wacker Neuson given the challenges faced by the pandemic. The company clearly has issues in the North American market, and earlier this year wrote off all of its goodwill in the business. It also implemented a restructuring plan which is also likely to have created some concerns and uncertainty. The America’s can be a tough market at the best of times, but as rental companies slashed their capital expenditure it seems to have hit Wacker harder than most local manufacturers.

The company is in a more solid financial position than ever however and has very good products so will most likely bounce back strongly in 2021 with a new CEO on board.