Hermle posts significant upward trend

Hermle posts significant upward trend
At end of May 2021, orders received had risen by 28% to €134 million
Group-wide turnover of €113 million still 14% below previous year’s level
Full-year turnover expected to remain stable with growth of 10% or over achievable
Annual General Meeting approves unchanged payout of €5.05 per preference share and confirms the Supervisory Board 

Gosheim, 7 July 2021 – Maschinenfabrik Berthold Hermle AG sees an increasingly strong recovery in demand in the 2021 business year. The number of orders received by the southern German machine tool and automation specialist rose in the first five months by 27.9% to €134.4 million compared to the same period in 2020 (previous year: €105.1 million). Domestic business saw an increase of 43.2 % to €52.7 million (previous year €36.8 million), while international sales rose 19.6 % to €81.7 million (previous year €68.3 million). According to Hermle’s Management Board at today’s AGM, demand in the field of Industry 4.0 continues to grow. To meet this growing demand, the company offers a complete range of products from automated stand-alone machines to fully integrated automation solutions. Moreover, in addition to the more pandemic-resilient sectors such as the packaging, electronics and medical technology industries, business with those sub-sectors of the automotive industry that are not directly affected by the changes in automotive technology has also picked up recently. Orders on hand as of 31 May 2021 Group-wide totalled €66.3 million compared to €73.0 million on last year's reporting day and €44.8 million as of the end of 2020.

In the first five months of 2021, Hermle Group-wide turnover was still down 14% (€112.9 million) on the comparable figure for the previous year (previous year: €131.3 million). Of that total, €46.4 million was generated within Germany (previous year: €52.5 million) and €66.5 million in international markets (previous year: €78.8 million). As expected, the operating result developed at a significantly lower rate than turnover. This is due first to sustained, sharp price increases for purchased materials and energy, which were previously not passed along to customers, and also to Hermle's goal to keep the workforce intact during the pandemic to be able to restart quickly afterwards. The number of employees decreased only slightly to 1297 at the end of May 2021 (31 May 2020: 1303), and the scope of reduced working hours was reduced somewhat.

Developments in the first five months support Hermle’s forecast for 2021: Provided that the general conditions do not change fundamentally - e.g. due to new variants of Covid-19 or other negative influences - the company expects to make up for the shortfall in turnover that still existed at the end of May throughout the rest of the year and to once again achieve at least the previous year’s level of €296.9 million. If the surge in demand continues quite so dynamically, there is even a chance of turnover increasing by 10% or more. On the other hand, due to the generally growing need for various raw materials, there is a noticeably increasing risk of bottlenecks in the supply chain. As a result of the described increases in procurement prices as well as a higher share of personnel costs, the operating result is expected to develop at a significantly lower rate than turnover, also in the full year 2021. If possible, employees should receive all additional benefits in 2021 as well regardless of reduced working hours, including vacation and Christmas bonus, special collective bargaining bonuses and a general bonus.

The number of people working reduced hours has gradually declined since May 2021. This trend may continue in the second half of the year, given that production planning has already had to be adjusted upward several times due to the improved demand situation. In addition, Hermle will be investing in a new large machining centre for the production of parts at the company’s headquarters in Gosheim in the coming months and will begin setting up an expanded spindle production facility. In terms of products, additional automation and software components are planned.

At the shareholders' meeting today, which again had to be held virtually, shareholders approved the dividend proposal as well as the administration's other proposals. This means shareholders can look forward to an unchanged payout (basic dividend) of €0.80 per ordinary share and €0.85 per preference share, as well as a stable bonus of €4.20 per share. Thus resulting in a payout of €5.05 per preference share. Employees will also receive a bonus for the 2020 business year at the same level of the previous year. The election proposals for the Supervisory Board were also accepted. As a result, the Supervisory Board in its previous form was confirmed.

Maschinenfabrik Berthold Hermle AG is one of the world’s leading manufacturers of milling machines and machining centres and offers its customers complete automation solutions under one roof. In 2020, the company generated Group-wide turnover of €296.9 million and EBIT of €54.2 million. Owing to their high quality and precision, Hermle machine tools and manufacturing systems are used in high-tech sectors such as toolmaking and mould construction, medical technology, the optical industry, packing technology, the aerospace industry, energy technology, electronics, the automotive and motor sport industries including their subcontractors. Hermle shares are traded on the regulated Stuttgart and Frankfurt stock markets.

Press contact: Redaktionsbüro tik GmbH, Gabriele Rechinger, Phone +49 (0) 911 95 97 870, E-Mail: info@tik-online.de 

Image material: Maschinenfabrik Berthold Hermle AG, Marketing Department, Phone +49 (0)7426 95 0, E-Mail: marketing@hermle.de

The Management Board’s speech at the AGM can be can found at https://www.hermle.de/hauptversammlung.