Bühler reports dip in 2013 earnings
Feb. 12, 2014
by World Grain Staff
UZWIL, SWITZERLAND — Bühler Group reported on Feb. 11 that sales revenue in 2013 dropped 3.6% to CHF 2.322 billion ($2.594 billion).
With CHF 139 million or 6% of sales, the EBIT margin fell short of the result of the year before (CHF 168 million). On the one hand, this is due to the strategic optimization of the Advanced Materials division’s portfolio, which entailed integration and restructuring costs.
Another one-time effect with a negative impact on Bühler Group’s profitability was unsatisfactory project management in some business units. The Group result is CHF 123 million or 5.3%.
Regardless of the lower EBIT achieved in the year under review, Bühler deliberately maintained its high level of spending on research and development of over CHF 100 million as well as the global expansion of its local customer service organizations.
Order intake amounted to CHF 2.363 billion and was thus 1% higher than a year ago. Whereas the Food Processing division grew by 7%, Grain Processing received 3% less orders. The Advanced Materials division increased its order intake by more than 4%, despite the disinvestment of the Thermal Processes business unit. Whereas the new-plant business frequently suffered delays due to financing challenges that customers faced, the customer service business grew once again at a rate of 8%.
The picture is also mixed with regard to the development of order intake by regions. In North America, it slipped 17% below the value of the previous year, though this was still the second-best volume ever achieved. Declines were also suffered by the regions of Middle East/Africa (-14%) and India (-11%), especially due to the devaluation of some local currencies.
On the other hand, Bühler booked 23% more orders in South America, which is a new record. Following a disappointing previous year, Europe grew by 11% in 2013. Asia achieved outstanding growth of 12%.
At the start of 2014, Bühler had a solid backlog of orders of CHF 1.3 billion. It provides the potential for achieving further growth on condition that the pace of capital investment picks up again.