Automotive industry Orders at Bucher Industries decline significantly

Bucher Industries posted lower sales in the first nine months of the current year than in the previous year. However, order intake fell even more sharply. The previous forecasts for the year as a whole have become somewhat more defensive with regard to the margin.

Turnover fell by 11.4 percent to 2.42 billion Swiss francs between January and the end of September, as the specialist for agricultural machinery, hydraulics and municipal vehicles announced on Thursday. Currency effects also had an impact here. Excluding these effects, the decline in local currencies was a more moderate 9.3 percent.

Incoming orders were down even more significantly on the previous year. It fell by 19.7 percent to 1.96 billion Swiss francs; adjusted for currency effects, the decline amounted to 17.7 percent. This means that Bucher's order intake was more or less in line with analysts' expectations, while sales were at the lower end of the forecast range.

Slowdown in order intake stabilizes

As expected, demand declined in the first nine months of 2024, according to the business performance report. The areas associated with agriculture and the Emhart Glass division were particularly hard hit by the downturn. However, the slowdown in order intake has stabilized since the middle of the year.

The economic slowdown was particularly noticeable in Europe, while the North American and Asian markets performed better, Bucher said, commenting on the geographical development.

In Kuhn Group, the largest division, currency-adjusted sales fell by a good 17 percent and order intake by a good 22 percent. However, the other four divisions also received fewer orders. Only the Municipal division, which manufactures municipal machinery, achieved an increase in sales.

Margin forecast reduced

Bucher expects demand to continue to be affected by the volatile environment in the final quarter. While the agricultural machinery market is unlikely to recover, other markets should continue to stabilize.

The previous forecasts for 2024 as a whole have been formulated somewhat more cautiously, at least with regard to the margin. Due to low capacity utilization, the operating profit margin is likely to decrease year-on-year and be in the high single-digit range. Previously, the aim was to achieve an EBIT margin of at least double digits.

Furthermore, an unspecified decline in sales and a lower net profit are expected for 2024. However, investments in innovations are to be maintained.

The sale of a non-operating property has also been under negotiation for some time. This could be concluded before the end of 2024 or the beginning of 2025. If this is the case in the current year, the profit from the sale would increase the operating profit margin by around 1.4 percentage points.

SDA