Airport Towing Trucks For Material Handling

Hamburg—Jungheinrich AG emerged from the economic crisis stronger than before in 2010 and is back on course for profitable growth. Benefiting from the substantial recovery of the world economy, the material handling equipment sector saw the material handling equipment market expand by 45 per cent worldwide and by 32 per cent in Jungheinrich's core markets in Europe.

Jungheinrich took advantage of these encouraging framework conditions, increasing incoming orders and net sales considerably. The earnings trend benefited from the rise in plant capacity utilization and an improvement in the product mix. The company returned to profitability on the back of a big jump in earnings.

In the 2010 reporting year, net sales were up 8 per cent to 1,816 million euros (prior year: 1,677 million euros). New truck business made a contribution, posting an increase of about 13 per cent. All regions contributed to the rise in net sales. Domestic business was up 6 per cent year on year to 493 million euros (prior year:  466 million euros). Conversely, foreign net sales advanced by 9 per cent to 1,323 million euros (prior year: 1,211 million euros).

The foreign ratio thus rose to 73 per cent (prior year: 72 per cent). The portion of consolidated net sales accounted for by countries outside Europe climbed to 7 per cent (prior year: 5 per cent).

Unit-based incoming orders in new truck business grew by 31 per cent groupwide to 64.9 thousand trucks (prior year: 49.5 thousand units). Compared to the preceding year, the value of incoming orders, encompassing all business areas, increased by 16 per cent to 1,924 million euros (prior year: 1,654 million euros). Production output, which tracked the considerable rise in incoming orders with a time lag, grew by 25 per cent in 2010 to 60.4 thousand trucks (prior year: 48.3 thousand units).

Over the course of the year, orders on hand from new truck business climbed significantly, totalling 281 million euros (prior year: 208 million euros) by December 31, 2010.

In the 2010 reporting period, the company generated operating earnings before interest and taxes (EBIT) of a positive 98 million euros (prior year: a negative 72 million euros including one-off expenses amounting to 80 million euros). "This is a good result for a 'post-crisis' year, although the pre-crisis level has not been reached yet. However, our company has already returned to a respectable level, compared to the long-term average," said Hans-Georg Frey, Chairman of the Board of Management, at the Jungheinrich balance sheet press conference on March 31, 2011 in Hamburg.

The EBIT return on sales amounted to a positive 5.4 per cent (prior year: a negative 4.3 per cent). The corresponding return on interest-bearing capital employed (ROCE) rose to a positive 22.7 per cent (prior year: a negative 16.8 per cent), thus again achieving the Jungheinrich Group's long-term ROCE goal of over 20 per cent. Net income, which benefited from a low tax rate, rose disproportionately to a positive 82 million euros (prior year: a negative 55 million euros). On this basis, imputed earnings per preferred share amount to a positive 2.45 euros (prior year: a negative 1.59 euros).

In light of the improved earnings trend, the Board of Management and the Supervisory Board of Jungheinrich AG will propose to the Annual General Meeting on June 15, 2011 that ordinary shareholders be paid a dividend of 0.49 euros per ordinary share (prior year: no dividend) and that preferred shareholders be paid a dividend of 0.55 euros per preferred share (prior year: minimum dividend of 0.12 euros).

Research and development expenses of the Jungheinrich Group were at a high level in the financial year that just ended, totalling 36 million euros (prior year: 39 million euros). In the field of fundamental research, work was done to investigate alternatives for increasing energy efficiency and, in turn, environmental friendliness, including energy storage based on lithium-ion technology.

Capital expenditures on tangible and intangible assets amounted to 33 million euros in 2010 (prior year: 46 million euros). This included a new powder coating facility at the Norderstedt plant designed taking account of the most up-to-date environmental considerations.

As of December 31, 2010, the Group employed 10,138 people (prior year: 10,266), 5,477 of whom worked abroad (prior year: 5,473) and 4,661 of whom worked in Germany (prior year: 4,793).

Current business situation and outlook for 2011

The substantial recovery of the market for material handling equipment witnessed in 2010 continued in the first two months of this year. Global demand rose by a total of 48 per cent (prior year: 31 per cent) from January to February of 2011. The European market recorded 62 per cent (prior year: 3 per cent) growth in the same period.

Jungheinrich's new truck business benefited significantly from this development. In the first two months of 2011, the value of incoming orders, encompassing all business areas, increased by 26 per cent to 333 million euros compared to the year-earlier period (prior year: 265 million euros). During the same period, the value of orders on hand from new truck business rose by 17 per cent to 329 million euros.

By the end of February 2011, net sales amounted to an accumulated 279 million euros, which was 21 per cent more than the 230 million euros achieved by the same time in 2010.

In May of this year, the company will furnish proof of its ability to deliver as an intralogistics service and solution provider with manufacturing operations and showcase numerous new developments at CeMAT in Hanover, Germany, the world’s largest trade show for the sector.

"Since the economy has been robust so far, the prospects for the material handling equipment industry stand a good chance of remaining bright. Following the strong catch-up effect experienced last year, however, the market is likely to lose some of its momentum. However, it is impossible to predict the effects the dramatic natural disaster in Japan will have on the world economy," explained Hans-Georg Frey. Irrespective of any potential consequences, Jungheinrich expects the world material handling equipment market to post about 10 per cent unit growth to some 870 thousand trucks.

The pre-crisis level witnessed in 2008 may thus nearly be matched. On this basis, Jungheinrich anticipates over 1.95 billion euros in organic incoming order growth, over 1.9 billion euros in consolidated net sales growth and an increase in operating income. Says Frey: "Our company is well equipped for the future and is on course towards returning to its former sales and earnings power in the foreseeable future."

Jungheinrich ranks among the world’s leading companies in the material handling equipment, warehousing and material flow engineering sectors. The company is an intralogistics service and solution provider with manufacturing operations, which offers its customers a comprehensive range of forklift trucks, shelving systems, services and advice. Jungheinrich shares are traded on all German stock exchanges.

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