The Executive Board of Vossloh AG decided on implementing a programme for a sustainable increase in profitability as well as an improvement in the self-financing capability and thus reduce the net financial debt of the Vossloh Group.
The programme includes, among other things, a reduction in the number of employees from the end of 2018 amounting to around 5 percent as well as a systematic review of unprofitable activities. The necessary decisions and resulting measures will essentially be implemented in 2019.
In addition, the programme will increasingly focus on reducing overheads, savings in capital expenditures and intensified measures for reducing working capital. Further measures are being reviewed on an ongoing basis. With these measures, the Executive Board aims to expand Vossloh’s financial scope for future growth in an increasingly digital rail world.
The Management confirmed the communicated outlook for the operational business in the 2019 fiscal year, with Group’s sales of EUR 900 million to EUR 1 billion and an EBIT between EUR 50 million and EUR 60 million. Effects on earnings from the programme of measures cannot yet be sufficiently quantified from the current perspective and therefore are still not incorporated into the 2019 outlook.
In particular regarding unprofitable activities, no specific decisions have yet been made. For the 2020 fiscal year, management plans are unchanged for Group sales between EUR 950 million and EUR 1.05 billion and EBIT between EUR65 million and EUR 80 million.
In the first quarter of 2019, Group’s sales increased to EUR 190 million, compared to EUR 178.3 million in the previous year. EBIT of EUR 600.000 was within expectations and slightly below the previous year’s level, of EUR 1.6 million. Net financial debt, without finance leases, was EUR 370.7 million as of March 31, 2019, increasing from EUR 248.1 million, registered in March 31, 2018.
Net income was EUR 22.5 million (previous year: EUR 1.4 million) and was burdened by a negative result from discontinued operations.
The 2019 Group’s orders increased by 33%, from EUR 211.4 million in 2018, to EUR 281 million.
The order backlog of EUR 686.1 million as of March 31, 2019 was also significantly higher than the previous year’s figure of EUR 513.2 million.