Austria-based Palfinger’s revenue increased 18.5% in the first quarter of 2014 to €267.6 million, primarily as a result of strong demand from the European markets.
Earnings before interest and tax (EBIT) rose 11.3% to €20.1 million, but suffered due to shifts in the foreign currency exchange rates of the Brazilian real and the Russian ruble, as well as the impact of the harsh winter in North America.
“We are satisfied with the results recorded, because they show that in a volatile environment our flexible global organization is able to stand its ground,” commented Herbert Ortner, Palfinger’s CEO.
All business units contributed to the increase in revenue. While strong demand in Europe boosted revenue by more than 25.1% in the European Units segment to €191.5 million, the increase in the company’s Area Unit segment was 4.8%, amounting to €76.1 million. The growth achieved in that segment was mainly attributed to the Asia and Pacific regions.
The EBIT margin for the segment came to 13.6%, despite investments in the acquisition of two access companies in November last year, specialising in offshore and shipping: Palfinger Systems in Austria and the Megarme Group in UAE.
However, a negative contribution to earnings was reported in the Area Unit segment, “for the first time in years,” said the company. It dropped from €1.9 million in the first quarter of 2013 to €1.2 million. “The reasons for this decrease are weather-related declines in North America as well as the impact of shifts in the exchange rates in Brazil and Russia. However, full order books and the large number of incoming orders give reason to believe that this segment will soon make a positive contribution to earnings again,” explained a company spokesman.
Expectations are high for the rest of the year. Palfinger’s management board forecasts revenue for the complete 2014 financial year will exceed €1 billion, making it a record 12 months for the company. The company said it sees potential to double consolidated annual revenue to about €1.8 billion by 2017.