Rosenbauer International AG: Rosenbauer Group has significantly more business after nine months

Leonding (pta007/12.11.2019/07:00 UTC+1) * Revenues rose by 11% to Eur 614.5 million by period comparison
* Incoming orders at previous year's level at Eur 784.1 million
* EBIT at Eur 15.1 million due to high costs of material and staff, despite strong operating performance
* Management raises revenue target to over Eur 980 million for the full year, EBIT margin adjusted to around 5.1%

GROUP KEY FIGURES		1-9/2018	1-9/2019
Revenues	Eur million	552.0	614.5
EBIT	Eur million	17.0	15.1
Net profit for the period	Eur million	10.6	9.0
Cash flow from operating activities	Eur million	-83.4	-136.3
Equity in % of total assets		29.7%	24.4%*
Earnings per share	Eur	0.6	0.3
Number of employees as of 30 September		3,546	3,781
Order backlog as of 30 September	Eur million	1,093.6	1,223.8

The Rosenbauer Group significantly expanded its business volume in the first nine months of 2019. Group revenues rose by 11% year-on-year from Eur 552.0 million to Eur 614.5 million. In particular, deliveries to North America, Central Europe and Asia were higher, while the Middle East and Northern and Western Europe recorded declines. At Eur 784.1 million, incoming orders were at the previous year's level (1-9/2018: Eur 789.9 million). Expenses for materials and staff were high due to production factors, meaning that EBIT was just Eur 15.1 million (1-9/2018: Eur 17.0 million) despite a stronger operating performance. In view of the very strong capacity utilization at the production facilities, the Rosenbauer Managing Board is raising its revenue target for 2019 to more than Eur 980 million, the EBIT margin is expected at around 5.1%.

Revenues and result of operations
After a significant slowdown in the first three quarters of the previous year, global economic activity continued to weaken in 2019. In particular, manufacturing activities lost momentum and fell to levels similar to those seen at the time of the global financial crisis. Intensified economic and geopolitical disputes are also slowing global trade and dampening economic optimism. For this reason, the International Monetary Fund (IMF) once again reduced its growth forecast for the global economy in October by 0.3 percentage points to 3.0% compared with April 2019.
The global firefighting industry generally lags economic performance and continues to record robust demand in this economic environment.

The Rosenbauer Group generated revenues of Eur 614.5 million in the first nine months of 2019 (1-9/2018: Eur 552.0 million). These are currently divided across the segments as follows**: 34% in the CEEU area, 10% in the NISA area, 8% in the MENA area, 13% in the APAC area, 32% in the NOMA area, and 3% in Stationary Fire Protection.

A pronounced seasonality is characteristic of the firefighting industry. Accordingly, inventories tend to build up in the first six months of a financial year, with the majority of deliveries being made in the second half of the year. At Eur 15.1 million, EBIT for the first nine months of 2019 was below the corresponding figure from the previous year (1-9/2018: Eur 17.0 million). This is due to the high production-related expenses for staff and materials, which more than offset the higher operating performance. Consolidated EBT for the reporting period amounted to Eur 9.9 million (1-9/2018: Eur 11.7 million).

At Eur 784.1 million, incoming orders in the first nine months were on par with the previous year (1-9/2018: Eur 789.9 million). By far the strongest year-on-year growth was reported in the area NISA and CEEU. The order backlog was Eur 1,223.8 million (1-9/2018: Eur 1,093.6 million), which is a new historical record value.

Financial and asset position
Due to the high order backlog and strong capacity utilization, the structure of the Rosenbauer Group's statement of financial position as of the end of the third quarter is characterized by high trade working capital. Total assets increased to Eur 954.2 million by period comparison (September 30, 2018: Eur 756.3 million), which can be attributed in particular to the higher current assets compared with the balance sheet date of December 31, 2018. The first-time application of IFRS 16 contributed to an extension of the balance sheet total in the amount of Eur 23.8 million.

The major changes result from inventories and current receivables. Inventories increased to Eur 502.2 million (September 30, 2018: Eur 366.3 million), Eur 66.9 million of which are attributable to the conversion to IFRS 15. The current receivables were also above the previous year's level at Eur 224.1 million (September 30, 2018: Eur 185.7 million). Owing to the high level of trade working capital the intra-year cash flow from operating activities was negative at Eur -136.3 million (1-9/2018: Eur -83.4 million). A significant improvement in the cash flow from operating activities is expected by the end of the year.

The Group's net debt (the net amount of interest-bearing liabilities less cash and cash equivalents and securities) increased year-on-year to Eur 425.6 million (September 30, 2018: Eur 293.7 million).

Outlook
The IMF recently again reduced its global growth forecast. International trade conflicts and geopolitical tensions are slowing trade and investment decisions. Next year, growth should stabilize again and the global economy should be able to move up by 3.4%.

As shown from past experience, the firefighting industry follows the general economy at a delay of several months. Demand is robust and, not least thanks to full order books, the sector is holding its ground despite slowing economic growth. A consistently vital project landscape should also support further market growth and prolong the successful development of the sector. In particular North America and Europe should expand their volume more strongly.

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*) without IFRS 16: 25.0%
**) CEEU: Central and Eastern Europe; NISA: Northern Europe, Iberia, South America, Africa; MENA: Middle East and North Africa; APAC: Asia, Pacific, Australia, China; NOMA: North and Middle America

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