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19. March 2021Interroll was able to maintain the good overall result of the previous year in the 2020 financial year: although sales fell due to the strong Swiss franc to CHF 530.6 million (-5.2% compared to the previous year, in local currencies +0.9%), incoming orders were increased to CHF 547.8 million (+0.3% compared to the previous year, +6.6% in local currencies). The result increased significantly by 28.0% compared to the previous year. The group looks cautiously optimistic towards 2021.
(Sant’Antonino, Switzerland) In local currencies, sales recorded an increase of +0.9%, but due to the strong Swiss franc, it consolidated to CHF 530.6 million (-5.2% compared to the previous year). The worldwide consolidated order intake could even be improved in local currencies by +6.6% and in consolidated currency by +0.3% to CHF 547.8 million. After a pandemic-related difficult first half of the year in project business, business dynamics accelerated in the second half of the year in nearly all markets.
Growing Project Business
In the 2020 financial year, Interroll produced record quantities of conveyor rollers. The consolidated sales in the product group “Rollers” amounted to CHF 106.0 million, which corresponds to a decrease of -3.8% compared to the previous year (CHF 110.1 million). The consolidated order intake was slightly below the previous year’s level at CHF 107.5 million, down -0.3% from CHF 107.8 million.
The consolidated sales of the product group “Drives” amounted to CHF 156.5 million in the 2020 financial year, which is -9.2% lower than the previous year (CHF 172.4 million). The consolidated order intake fell by -6.9% to CHF 157.6 million compared to CHF 169.2 million in the previous year.
The product group “Conveyors & Sorters” achieved consolidated sales of CHF 221.5 million in the 2020 financial year, which is a slight decrease of -0.7% compared to the previous year (CHF 223.2 million). The order intake was CHF 233.2 million, which is 8.5% above the level of the previous year (CHF 214.9 million). A temporarily declining trend in the first half of the year was noticeable here. In the second half of the year, Interroll was able to announce a major order for a leading supermarket chain for the delivery of more than 9 kilometers of Interroll Modular Conveyor Platform (MCP), including a record number of EC 5000 RollerDrive units for a new construction project in Germany.
In the reporting year, Interroll recorded a decrease in consolidated sales in the product group “Pallet Handling” of -13.7% to CHF 46.6 million (previous year: CHF 54.0 million). The consolidated order intake fell by -9.2% to CHF 49.5 million (previous year: CHF 54.5 million). While important projects related to “Pallet Handling” in the warehouse area were postponed during the Corona crisis, they were not canceled.
Different Developments in the Regions
In local currency, net sales in the EMEA region (Europe, Middle East, Africa) fell by -5.1%. Consolidated sales amounted to CHF 287.0 million, which is 10.6% below the previous year (CHF 321.0 million). Incoming orders fell by -3.9% compared to the previous year (CHF 312.0 million) to CHF 299.9 million.
In the Conveyors & Sorters segment, the region was able to record an increase in order intake. With a share of nearly 54% of Interroll’s total sales, EMEA remains the economically most significant region within the group. The demands on suppliers in internal logistics are high. They require not only close customer relationships, industry knowledge, and technical solution competence but also innovative responses to increasing complexity and new market trends. With the construction of a new plant in Mosbach, Germany, Interroll is preparing for future growth in the EMEA region.
Sales in North and South America amounted to CHF 158.1 million, which is 6.1% higher than the previous year (CHF 149.0 million). With a growth of 13.0% in incoming orders to CHF 165.6 million (previous year: CHF 146.6 million), strong impulses were noticeable. Especially in sorters (+83.8%), there were numerous new orders, including orders for the new High-Performance Crossbelt Sorter (HPCS). There was also growth in conveyor rollers and drives. This development was strongly influenced by the U.S. market.
Interroll’s sales in the Asia-Pacific region rose by 1.7% in local currency despite the lack of large orders in the reporting year, but consolidated sales fell by -4.6% to CHF 85.5 million (previous year: CHF 89.6 million). Incoming orders decreased to CHF 82.3 million (-6.3%; previous year: CHF 87.9 million). Belt curves were able to record growing sales and incoming orders in the region. After large projects in the previous year, demand for the Modular Conveyor Platform (MCP) was somewhat more subdued. As in previous years, China remained the most important market for Interroll in the region. Very positive impulses came from Southeast Asia, which Interroll is increasingly focusing on. The region is increasingly benefiting from the globalization of the Interroll Group as well as the expansion and modernization of its own production facilities on-site. The Shenzhen plant moved to a new, more modern location at the beginning of the year, and a new plant for Suzhou is planned for 2022, which will increase production capacity.
Record Results
The EBITDA was significantly increased to CHF 115.4 million (previous year: CHF 96.1 million). The EBITDA margin increased to 21.7% (previous year: 17.1%). The profit before interest and taxes (EBIT) reached CHF 94.1 million (+30.1% over the previous year with CHF 72.3 million), which corresponds to an EBIT margin of 17.7% (previous year 12.9%). The result increased sharply by 28.0% to a record level of CHF 71.7 million. The result margin reached 13.5% (previous year: 10.0%).
Solid Balance Sheet Performance and Stronger Cash Flow
The balance sheet total grew to CHF 468.8 million as of December 31, 2020, which is 7.7% above the value at the end of 2019 (CHF 435.1 million). Equity increased to CHF 312.0 million, and the equity ratio is 66.5% (end of 2019: 69.9%). Net financial assets rose by 19.9% to CHF 92.2 million (previous year: CHF 76.9 million). Operating cash flow increased by 23.4% to CHF 122.9 million (previous year: CHF 99.6 million) as a result of the record result and good management of current assets. The significantly lower net working capital compared to the previous year was mainly due to customer prepayments for projects. Gross investments amounted to CHF 51.3 million (previous year: CHF 33.6 million). The investments were particularly directed towards the second own production plant, which was completed at the Hiram, USA location, and the construction of the Mosbach, Germany plant, which made significant progress in the reporting year. The detailed planning for the new plant in Suzhou, China, has been largely completed.
Innovation
The new Interroll High Performance Crossbelt Sorter (HPCS) was launched worldwide in March 2020 and already recorded active orders throughout the year. This new high-performance system can handle up to 20,000 items per hour. In addition, significantly heavier (up to 50 kg) and larger goods can be sorted.
Positive Share Price Development of Interroll and Again Increased Dividend Proposal
With a closing price of CHF 2,695.00 on December 30, 2020, the Interroll share was 23.9% above the year-end price of 2019 (CHF 2,175.00). The excellent annual result for 2020 prompts the Board of Directors to increase the distribution again and to propose a dividend of CHF 27.00 (+20.0%) per share (previous year: CHF 22.50) to the upcoming General Assembly.
Outlook: Cautiously Optimistic Despite Mixed Short-Term Signals
The group has started the 2021 financial year positively. Important core markets, such as Germany, are still suffering from the effects of the Covid-19 pandemic. Nevertheless, the medium-term market demand for Interroll solutions remains disproportionately strong, and the sustainable expansion of Interroll in the market goes hand in hand with the need to expand capacities. In addition, Interroll is focusing on an expanded technology platform, which will be complemented in 2021 by a new sorting solution for the basic segment and a new generation of belt curves.
“We are pleased to continue to maintain our pace of innovation in the coming months and years,” explains Paul Zumbühl, CEO of the global Interroll Group. “Our strong financial situation allows the group to seize opportunities, to grow sustainably in the medium term, and to continue to invest decisively in capacity expansion and digitalization.”
Photo: © Interroll
