Quarterly Results DMG Mori continues on growth path

Editor: Alexander Stark

Germany — Machine engineering company DMG Mori registered high growth rates in the first nine months. The Ebit margin improved to 8.0 percent in the third quarter and free cash flow reached a record level as of September. The company therefore raised its forecasts for 2021 again.

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For the full year 2021, the company is now planning order intakes of around € 2.5 billion.
For the full year 2021, the company is now planning order intakes of around € 2.5 billion.
(Source: DMG Mori)

During the first three quarters of 2021, DMG Mori's order intake rose by +62 percent to € 1,928.6 million (previous year: € 1,187.8 million). Sales revenues increased by +11 percent to € 1,450.9 million (previous year: € 1,305.3 million). The earnings and financial situation also continued to develop positively: Ebit rose to € 83.7 million (+57 percent; previous year: € 53.4 million). The Ebit margin improved to 5.8 percent (previous year: 4.1 percent). As at 30 September 2021 free cash flow reached a new record level of € 149.0 million (+326 percent; previous year: € -65.8 million).

The global market for machine tools continued to recover but was characterized by increasing material and supply shortages. DMG Mori achieved a significant increase in order intake by +68 percent in the third quarter 2021 (previous year: € 403.8 million). In particular, the new machine business grew notably by +84 percent. Overall, orders rose to € 679.9 million, even +14 percent above the high pre-corona level 2019 (€ 596.1 million).

As at 30 September 2021, DMG Mori's order intake increased by +62 percent to € 1,928.6 million (previous year: € 1,187.8 million). Thus, the core business with machine tools and services in the first nine months was even above the high pre-crisis level of 2019 (+3 percent; € 1,875.7 million). Domestic orders increased by +70 percent to € 585.8 million (previous year: € 344.6 million). International orders were up by +59 percent to € 1,342.8 million (previous year: € 843.2 million). The share of international orders amounted to 70 percent (previous year: 71 percent).

Material supply as a major challenge

Sales revenues increased to € 517.4 million in the third quarter (+11 percent; previous year: € 467.3 million). With continued high raw material prices, transport costs and a more difficult material supply, sales revenues in the first nine months reached € 1,450.9 million (+11 percent; previous year: € 1,305.3 million). The export ratio was 68 percent (previous year: 69 percent). The pressure on supply chains remains high worldwide and additionally intensified by logistics shortages. DMG Mori has so far been able to avoid severe production interruptions thanks to a stable and good network to partners and suppliers.

Focused measures for more efficiency and productivity

On 30 September 2021, the order backlog amounted to € 1,256.1 million (31 Dec. 2020: € 852.2 million) — a calculated production capacity of an average of seven months. The company is countering the resulting longer delivery times with focused measures such as the expansion and optimisation of assembly and production capacities.

In the financial year 2021 the manufacturer presents 42 innovations together with DMG Mori Company — including ten world premieres, three automation solutions, 23 digital innovations and six new DMG Mori Components. At the “Global Development Summit” in October, around 300 international experts came together digitally to develop and push forward future ideas for networked solutions of machine, automation, digitisation and sustainability.

In the run-up to EMO in Milan, DMG Mori presented a total of 25 completely climate-neutral high-tech machines at a pre-EMO show at Deckel Maho Pfronten — live on site and also digitally. The focus was on automation with more than ten holistic solutions for workpiece and pallet handling with cell controller technology as well as the driverless transport system TH-AGV for autonomous tool transport between machines and the central tool magazine. A highlight in the field of digitization was the new subscription business model PAYZR. With “PAY with Zero Risk”, customers benefit from fast innovation cycles without risk — with maximum flexibility, cost and price transparency and thus maximum planning reliability. The PAYZR offer is continuously being expanded, as most recently with the CLX 450 TC turn-mill machining center for Equipment-as-a-Service or with up2parts for Software-as-a-Service.

Forecasts for the financial year 2021 raised again

The overall economy and the global market for machine tools are on the road to recovery. According to the October forecast of the VDW and British economic research institute Oxford Economics, the global machine tool consumption is expected to increase by +14.1 percent to € 67.1 billion in 2021. This development is increasingly being influenced by rising raw material prices, material and delivery shortages.

Due to the good business development in the first nine months, DMG Mori is once again increasing its forecasts: For the full year 2021, the company is now planning order intakes of around € 2.5 billion (previously: around € 2.25 billion). Sales revenues are now expected to be around € 2.0 billion (previously: around € 1.95 billion). The managers currently estimate Ebit of around € 120 million (previously: around € 100 million). Free cash flow is expected to be around € 150 million (previously: around € 140 million).

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