German OEM, Krone, has released 2018-19 financial results (1 August – 31 July 2019), reporting a turnover of €2.24 billion amid difficult conditions in the agricultural machinery and trailer industries.
Krone generated sales worth €692.7 million in Germany, which corresponds to a rise of €109.8 million (18.8 per cent). Agricultural machinery accounted for 28.3 per cent of domestic sales and automotive engineering 71.4 per cent.
By comparison, sales in markets outside Germany stood at €1,547 billion in the 2018-19 financial year and were on par with the previous year. Almost 67.5 per cent of international sales was generated in the commercial vehicles sector, while agricultural machinery accounted for 32.5 per cent. The share of foreign sales at 69.1 per cent was slightly below the previous year's level (72.7 per cent).
The Krone Group employed a workforce of 5,292 in the last financial year (previous year's permanent staff 4,897). This figure includes 270 apprentices on average (previous year 278). The increase in the number of employees is attributed to the group’s expansion (for example, the acquisition of the Dutch Knapen Group) and to the advancement of Krone's sales network.
Commercial Vehicles S.A. employed 2,997 staff in the past financial year and Krone Agriculture 2,109 members of staff whereas 186 members were on the payroll of the Holding company, working at various offices and locations of the Group.
The balance sheet total for the 2018-19 financial year stood at €1305.5 million (previous year: €1,130.2 million). The investment volume of €92.9 million (previous period: €67.0 million) and changes to the consolidated companies that make up the Group amounting to €23.6 million are offset by depreciations to the value of €38.6 million in both business segments. This growth is mainly attributed to a number of investments at various production sites.
Liquidity dropped by €11.8 million to €135.4 million. This was mainly due to increased investment and a reporting-date related increase in receivables from goods delivered and services provided.
On account of the annual surplus, equity capital on the balance sheet date increased significantly to €585.1 million (previous year: €533.8 million). The equity capital ratio felt slightly from 47.2 per cent to 44.8 per cent.
Mid- and long-term borrowed capital increased to €424.4 million (previous €325.6 million) during the 2018-19 financial year. The Group has mid- and long-term capital to the value of €1,010 million (previous year: €859.7 million). This figure covers fixed assets as well as the total stock value and the majority of receivables.
The volume of investments made by the Krone Group in the previous financial year stood at €116.5 million, with tangible assets accounting for €78.1 million of this figure, intangible assets for €27.8 million and financial assets for €10.6 million. The largest sum was invested in the Herzlake site in the previous financial year. Here, the construction of a new factory doubled production capacity for the Dry Liner dry freight box body series and the swap systems. Other investments referred to the construction of the new Future Lab validation centre at Lingen and the acquisition of the Knapen Group.
Bernard Krone, Managing Partner of the Krone Holding, is delighted with the 2018-19 performance.
“The economy was challenged by the overall political situation and developments such as Brexit and the trade dispute between the US and China,” he said. “In addition, several regions were once again plagued by difficult weather – prolonged periods of drought or heavy rainfall. In view of these challenges, we are very grateful that many customers decided to invest Krone farm machines, trailers or axles. In general, we see a number of opportunities for future growth as we supply solutions to the challenges posed by megatrends such as a rapidly growing global population. The Earth's population is expected to reach 10 billion by 2050; all these people must be fed and to do this we need state-of-the-art, efficient agricultural systems. The transport of goods and thus freight traffic is also set to rise in parallel with global population growth.”