Rosenbauer International AG: Rosenbauer Group revenues stable in 2022 despite significant supply chain disruptions

Leonding (pta012/21.04.2023/07:00 UTC+2)

• Consolidated revenues on a par with the previous year at € 972.2 million
• EBIT including one-time effects negative at € -10.6 million
• Short-term profit improvement measures produce a positive fourth quarter
• Order intake of € 1,230.0 million in 2022 marks a new record, order backlog of € 1,469.7 million significantly higher than consolidated revenues for the year
• Acquisition of shares from US minority owners results in higher net debt, but is now opening up new opportunities in the key US market
• Dividend not being distributed for the 2022 financial year

The Rosenbauer Group's revenues were on a par with the previous year at € 972.2 million in 2022 (2021: € 975.1 million). The CEEU area and NISA area and the Preventive Fire Protection segment all succeeded in increasing their business volumes despite the adverse general conditions. The war in Ukraine put significant pressure on international supply chains and commodity markets from February onward, with critical supply bottlenecks and significantly higher prices for some materials subsequently having a material impact on vehicle production in the Rosenbauer Group. This meant that EBIT, which was also dragged down by one-time effects from the industry's leading trade show Interschutz and restructuring measures, was negative at € -10.6 million (2021: € 35.0 million). The EBIT margin was -1,1% (2021: 3.6%).

"Recurring supply chain disruptions led to considerable inefficiencies in production in 2022, making this the toughest year in Rosenbauer's history. Cost increases for preliminary products, raw materials and energy and a number of one-time effects had a significant impact on our earnings. In the past financial year, we put in motion a number of extensive measures aimed at increasing efficiency and additionally adjusted our bid prices for new tenders in several steps. The results of these efforts will gradually become apparent over the course of this year and next year. Our focus is squarely on cash flow and the quality of our results," says Sebastian Wolf, CEO of Rosenbauer International AG.

Revenues and results of operations

The global firefighting industry stagnated in 2022 in what was generally a weaker economic environment. Despite order books being full, supply chain disruptions and tight labor markets in some countries were the main factors that hampered an expansion of industry sales.

The missing parts situation did improve slightly, but not until towards the end of the year when Rosenbauer began to receive more truck chassis again allowing it to increase the number of deliveries. This meant the company closed the fourth quarter of 2022 with revenues of € 321.0 million and EBIT of € 19.9 million, which was almost on a par with the comparative period of the previous year.

After deducting cost of sales, gross profit amounted to € 128.9 million in 2022 (2021: € 156.5 million), a year-on-year decline of 18%. Significant production disruptions, higher material costs and one-time special items resulted in EBIT of € -10.6 million (2021: € 35.0 million).

Greater financing costs and the deconsolidation of the joint venture in Russia resulted in a negative financial result of € -19.6 million, which was substantially lower than the previous year's figure (2021: € -6.2 million). This meant that earnings before taxes (EBT) totaled € -30.2 million (2021: € 28.9 million).

There was an improvement in net profit/loss for the period in relation to EBT as a result of positive tax effects from the acquisition of shareholdings in the US and the recognition of loss carryforwards, but overall there was a net loss of € -22.3 million (2021: net profit of € 23.2 million).

"The fixed price agreements customary for the tender business in the public sector, the high degree of customization for firefighting vehicles and the long lead times involved leave us very little scope to counteract the kinds of dynamic changes in environment that we saw in the 2022 financial year. What this does mean, however, is that we need to become leaner and more efficient in our core business of vehicle production so that we might quickly return to a level of profitability that is in line with the industry. The high order backlog and the easing in the supply of materials we are now seeing are essential conditions for this," says Markus Richter, CFO of Rosenbauer International AG.

Demand for Rosenbauer firefighting technology was extremely strong in 2022 as well, with incoming orders of € 1,230.0 million marking a new record (2021: € 1,064.3 million). All five sales areas and the Preventive Fire Protection segment posted clear growth. LA County, California and Nashville, Tennessee, increased their orders from 2021 by 8 and 22 vehicles respectively and the company received a major order from the Oregon State Fire Marshalls for the delivery of 57 vehicles. Significant orders for ARFF vehicles and personal protective equipment were acquired in Australia. The Preventive Fire Protection segment reported the largest single project in the company's history to date with an order from Müllheizkraftwerk Wiesbaden, Germany. The Rosenbauer Group's order backlog of € 1,469.7 million as of December 31, 2022 (2021: € 1,145.2 million) was significantly higher than consolidated revenues for the year.

Financial position and net assets

Total assets accounted for in Rosenbauer's consolidated financial statements increased year-on-year and amounted to € 973.6 million as of December 31, 2022 (2021: € 891.6 million).

Equity came to € 186.2 million as of the end of the year (2021: € 210.4 million). Higher total assets drove the equity ratio down to 19.1% (2021: 23.6%).

At the end of 2022, trade working capital totaled € 368.0 million (2021: € 345.4 million). This increase is primarily due to increased inventories and greater customer receivables. Net cash flow from operating activities was slightly negative in 2022 at € -2.3 million (2021: € 143.0 million).

The acquisition of shares from two minority shareholders in the US subgroup and the financing this required was the main reason for the increase in net debt to € 319.9 million (2021: € 203.6 million).

Dividend

The Rosenbauer Group has a clear dividend policy that reflects company performance and is geared toward sustainability. In view of the negative result, the Executive Board and Supervisory Board will be proposing at the Annual General Meeting that the company refrain from distributing a dividend for the 2022 financial year (2021: € 0.90).

Outlook

A few days ago, the International Monetary Fund (IMF) slightly lowered its global economic outlook again. Growth is now expected to hit 2.8% in 2023 after 3.4% in 2022, before leveling off at around 3.0% p.a. over the next five years. At the same time, global inflation is expected to drop from 8.7% to 7.0% as commodity prices come down.

The firefighting industry, whose order books are full to bursting, lags behind the economic cycle. While the industry is anticipating a slight increase in demand again this year, the industry sales that can actually be achieved will remain dependent on the further development of international supply chains in particular.

Following a record level of incoming orders in 2022, the Rosenbauer Group has started the current financial year with a solid order backlog well in excess of one year's revenues, and thus a great deal of confidence. Based on a further improvement in the supply of truck chassis, the Group's Executive Board expects revenues to exceed € 1 billion in 2023. The EBIT margin is expected to improve by around 4 percentage points compared with the 2022 reporting year.

(end)

Emitter:	Rosenbauer International AG Paschinger Straße 90 4060 Leonding Austria
Contact Person:	Tiemon Kiesenhofer, MBA
Phone:	+43 732 6794-568
E-Mail:	tiemon.kiesenhofer@rosenbauer.com
Website:	www.rosenbauer.com
ISIN(s):	AT0000922554 (Share)
Stock Exchange(s):	Vienna Stock Exchange (Official Trade); Free Market in Berlin, Dusseldorf, Hamburg, Munich, Stuttgart, Tradegate