Media information - Half Year Results 2016

Zurich, 11 August 2016

Continued profitable growth for the Kardex Group

Kardex continues to perform well. The good result of the first half of 2016 ties in with the positive developments of the previous periods. In the first half of the year, the Group recorded strong levels of bookings, slightly higher revenues and a further increase in profitability.

Reduced currency effects

Compared to the previous year, the half-year figures have barely been influenced by currency effects. The consolidated turnover would have been about EUR 2 million higher without currency effects, but at EBIT level these effects were more or less neutralised.

Strong levels of bookings

With a 13.5% increase in bookings to EUR 204.7 million (previous year: EUR 180.3 million), the 200 million mark was passed for the first time in the first half year. The driving force behind this latest increase was Kardex Mlog, whose bookings increased by roughly 67% compared to the same period last year. In both divisions, the order backlog is higher than in the same period last year. On the other hand, the generated revenue of EUR 170.5 million was only slightly higher by 3.4% than in the same period in the previous year.

Double-digit growth in operating result

Thanks largely to economies of scale and further efficiency improvements in the factories, the higher revenue led to the gross margin at Group level increasing to 35.5% (previous year: 34.0%). However, the operative costs also rose, especially as the result of further increases in development expenditure. At EUR 18.0 million, the operating result (EBIT) equates to a 10.6% profit margin and is EUR 2.3 million respectively 14.6% higher than in the same period last year. The financial result, which benefited from currency gains in the same period last year, this time recorded a currency loss of EUR 0.5 million (previous period: currency gain of EUR 1.3 million). The recorded net profit of EUR 13.0 million is, however, still 5.7% up on the same period in the previous year.

Further increase in profitability at Kardex Remstar

In terms of volume, Kardex Remstar continued to develop positively in the first half year and was able to further increase its profitability despite higher expenditure for product and market development. Bookings saw a moderate 1.2% (in local currency 2.7%) increase on the strong level in the same period in the previous year and revenue rose by 3.9% (in local currency 5.4%). On the other hand, a strong operating result of EUR 17.9 million was recorded, up 16.2% on the same period in the previous year. A look at the geographic revenue development shows that the American market is still developing strong; positive trends can be seen in Southern Europe; Central and Northern Europe are stable; and the Asian markets, with the exception of India and Malaysia, are behind expectations. The revenue mix showed a pleasing increase in the after sale service share to 29.6%. OEM revenue is also already contributing 2.0% (previous year: 0.8%) to the total revenue. The development activities focused mainly on new products' planned readiness for series production.

Strong Bookings at Kardex Mlog

Kardex Mlog achieved strong bookings which increased by 67.0% against the same period last year. This development allows the company to focus further on projects with a balanced reward - / risk profile. The clear increase in bookings did not yet lead to a major increase in revenue in the first half year. Instead, this remains just 2.3% above that in the same period in the previous year. To handle the higher level of backlog, the headcount has been increased by about 10%. At EUR 1.4 million (EBIT margin 3.9%), the recorded operating result is only negligibly below that in the same period of last year (EUR 1.5 million). The high order backlog of EUR 58.4 million will positively affect revenue in the second half year.

Sustained solid Balance sheet

Kardex's balance sheet total has risen to EUR 237.1 million and the equity ratio has further increased to 59.8% (previous year: 58.7%). In the period under review, the generated free cash flow amounted to EUR 10.7 million and was influenced by normalised accounts receivables and higher investments compared to the higher free cash flow of the same period last year. The Group's net cash position increased to EUR 122.4 million as of 30 June 2016. However it should be taken into account that the pay-out to the shareholders through the reduction of the nominal value of CHF 3.00 per share (CHF 23.2 million) took place on 7 July 2016, i.e. after this balance sheet date. The Group continues to command the necessary flexibility to make targeted use of opportunities to further strengthen its market position.

Positive outlook

The market for intra-logistics solutions remains attractive, even if short-term demand dynamics vary in different regions of the world. In view of the good order backlog, the Board of Directors and Group Management expect the Group to continue developing positively in line with the communicated financial targets.

Today, 11 August 2016 at 01.00 p.m. (CET), an analyst and media conference call will be held with CEO Jens Fankhänel, CFO Thomas Reist as well as Investor Relations Contact Officer Edwin van der Geest to discuss the half-year results. The conference call will be held in English. The corresponding presentation is available on http://www.kardex.com/index.php?id=2186&no_cache=1&L=0.
Please dial in approx. 3 minutes prior to the conference and kindly hold the presentation ready.
To take part, dial: +41 (0)43 547 80 01
Conference-ID: 804087

Alternatively you can also participate via audio webcast on http://www.audio-webcast.com/cgi-bin/visitors.ssp?fn=visitor&id=3755. Please note that questions can only be placed via the conference call.

Interim Report
The Interim Report is available on http://www.kardex.com/index.php?id=2182&no_cache=1&L=0, on our website section Investor Relations/Financial Reports/Interim Report.

Key figures (EUR millions)

Kardex Group - Corporate Profile
The Kardex Group is a global industry partner for intra-logistic solutions and a leading supplier of automated storage solutions and material handling systems. The Group consists of two entrepreneurially managed divisions, Kardex Remstar and Kardex Mlog. Kardex Remstar develops, produces and maintains dynamic storage and retrieval systems and Kardex Mlog offers integrated materials handling systems and automated high-bay warehouses. The two divisions are partners for their customers over the entire life cycle of a product or solution. This begins with the assessment of customer requirements and continues through planning, realization and maintenance of customer-specific systems. It ensures a high level of availability combined with low total cost of ownership and operation. Around 1 500 employees in over 30 countries work for the Kardex Group.

Disclaimer

This communication contains statements that constitute "forward-looking statements". In this communication, such forward-looking statements include, without limitation, statements relating to our financial condition, results of operations and business and certain of our strategic plans and objectives. Because these forward-looking statements are subject to risks and uncertainties, actual future results may differ materially from those expressed in or implied by the statements. Many of these risks and uncertainties relate to factors which are beyond Kardex's ability to control or estimate precisely, such as future market conditions, currency fluctuations, the behavior of other market participants, the actions of governmental regulators and other risk factors detailed in Kardex's past and future filings and reports and in past and future filings, press releases, reports and other information posted on Kardex Group companies' websites. Readers are cautioned not to put undue reliance on forward-looking statements, which speak only of the date of this communication. Kardex disclaims any intention or obligation to update and revise any forward-looking statements, whether as a result of new information, future events or otherwise.