R. STAHL presents annual financial statements for 2010
As expected, R. STAHL group developed positively in the last fiscal year. After a still weak first half, sales and order intake reached the level they had before the crisis. With the strategic expansion of system business, R. STAHL could clearly expand its market position in 2010. Once again it became clear that the decision to keep the employees through the crisis has been right, says Martin Schomaker, CEO of the Executive Board, at today’s financial statements press conference. The company is excellently prepared to utilize the beginning upturn and to realize growth.
Order intake and sales on the same level as before the crisis
In fiscal 2010, R. STAHL achieved an order intake amounting to € 225.8 million (previous year: € 208.1 million). Consolidated sales rose to € 222.6 million, which is 10 % higher than last year’s value (€ 202.6 million). So the company, based in Waldenburg, again reached the figures of 2008, before the effects of the world-wide economic crisis were felt. With € 47.7 million, order backlog was higher by 12% at the end of the year, compared to the previous year.
Among others, the systematic expansion of system business we started five years ago contributed to this growth. Investment in qualified employees and instruments all over the world and the development of additional customer circles more than doubled sales in this sector since 2005, from € 50 million to € 120 million. It is the strength of R. STAHL that we can join products of automation technology and products of energy distribution and switchgear technology to form integrated solutions that combine all explosion protection technologies. With this know-how, the company acquired a unique selling proposition in the market.
Thus the decision to keep the core workforce during the crisis increasingly proves right as well. The know-how that has been constantly kept in the company supported expansion and growth of this future-oriented segment in 2010 and will in future do so as well.
Annual net profit increased by 88 %
In 2010 R. STAHL generated EBIT amounting to € 19.3 million after € 12.6 million in the previous year. Annual net profit rose by 88% and reached € 10.5 million after € 5.6 million last year. Sales revenues based on EBIT already achieved 8.7%, but could not yet reach the level it had before the crisis. Earnings are burdened by a still tense price situation in the markets and by the relatively high personnel costs, which are due to the decision to keep the core workforce during the crisis. Our objective therefore is to further increase sales per employee and to achieve the aspired growth with a disproportionate increase of personnel. Earnings per share increased from € 0.90 in 2009 to € 1.77.
Continuous dividend payout policy
R. STAHL pursues a continuous dividend payout policy with an annual payout rate of normally somewhere between 40 and 45% of the consolidated annual net profit. That is why Executive and Supervisory Board will propose a dividend of € 0.70 per no-par-value share entitled to dividend to the Annual General Meeting on 27 May 2011 (previous year: € 0.40).
Cash flow finances investments, acquisitions and dividend
Compared to the previous year, the company could maintain its net cash position almost unchanged at € 15.5 million. Cash flow from operating activities achieved € 19.0 million after € 10.9 million in the previous year. Investments in long-term assets, four acquisitions and the dividend could be financed from the cash flow. Furthermore, long-term financial liabilities of € 1.5 million could be repaid in the last fiscal year. Stock of means of payment at the end of the period amounted to € 19.6 million. Equity ratio rose from 41.5% in the previous year to 43.9% in the past fiscal year. So R. STAHL is soundly financed and has enough means to finance further acquisitions.
Forecast for 2011
The economic upswing, which started in the middle of 2010, still goes on. All important customer sectors of the expert in explosion protection show a willingness to invest. The chemical industry does maintenance work again, the pharmaceutical and the chemical industry plan modernizations world-wide and also expansions of the existing facilities. The high oil price spurs the oil and gas industry on. The order books of the international plant manufacturers and manufacturers of control systems are full. This results in invitations to bid; the orders will be awarded in 2011 and 2012. The companies we already acquired in 2010 and 2011 will contribute to the group’s growth, as will new products which the innovation process will put on the market.
From today’s point of view it is not sure how the effects of the catastrophe in Japan will be felt. Delivery problems from Japan could not only affect R. STAHL itself but also the customer circle, which may e.g. lead to another reduction of maintenance activities in the chemical industry. The uncertainties in the Middle East may also lead to a delay of projects; long-term projects of the oil and gas industry will presumably not be affected.
As the positive factors for the current and the next year clearly prevail, the Executive Board assumes group sales somewhere between € 240 million and € 250 million for 2011.
Besides the cost degression effect due to growth with a moderate increase of personnel, optimization projects in production and administration will also help to further increase result. The rise in material prices that is to be expected can be partly balanced by rationalization projects in procurement. That is why the management expects a significant increase of earnings in 2011 and an EBT between € 17 million and € 19 million.
R. STAHL acquired a good market position. The economic conditions in the markets are positive. The group is excellently positioned in regard to finance and strategy. That is why the Executive Board is confident that the predicted growth will be realized in 2011 and continued in 2012.
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