Vossloh adjusts sales revenues and earnings guidance for 2022
Based on the latest information on business developments, the Executive Board of Vossloh AG adjusted today the guidance for the 2022 fiscal year. Vossloh expects higher sales for the current fiscal year than previously assumed. The company now anticipates sales to be between €0.95 billion and €1.05 billion, while the previous expectation ranged between €0.925 billion and €1.0 billion. Higher sales contributions compared to the original forecast are expected in the Core Components division in particular. In addition to the good order situation and positive exchange rate effects, a key driver of this development is the passing on of higher procurement prices for materials and energy to customers. The portion of price increases that cannot be passed on or can only be passed on with a delay will weigh on the Vossloh Group’s EBIT in the 2022 fiscal year and, together with increased sales, will result in lower profitability. On this basis, the Executive Board now expects an EBITDA margin of between 11.5 percent and 13.5 percent and an EBIT margin of 6 percent to 8 percent for the current fiscal year. In order to take into consideration the current high level of uncertainty surrounding the COVID-19 pandemic and the war in Ukraine, the Executive Board has widened the forecast range to two percentage points. Previously, the guidance indicated an EBITDA margin of between 13 percent and 14 percent and an EBIT margin of between 7.5 percent and 8.5 percent, following an EBITDA margin of 13.2 percent and an EBIT margin of 7.7 percent in the 2021 fiscal year.
For the second quarter of 2022 Vossloh expects profitability to be noticeably lower than in the corresponding quarter of the previous year. However, based on the current outlook, profitability in the second half of 2022 is expected to be significantly higher than in the same period of the previous year.
“When we presented our encouraging figures for the first quarter, we already stated that developments in material prices in particular and the possibility of passing on of additional burdens would significantly impact profitability over the remainder of the year. The ongoing analysis of developments has now prompted us to adjust our expectations for this fiscal year,” said Oliver Schuster, Chief Executive Officer of Vossloh AG. “In addition, given the current situation, we cannot rule out the possibility of additional price increases for some materials in the course of the year. Besides, even if we pass on the full amount of higher procurement prices, in purely accounting terms this will have a negative impact on the profitability of the Group. Despite the difficult underlying conditions, we can look to the future with great confidence. The record level of orders received in the first quarter provides clear evidence of our strong competitiveness. We will master these temporary challenges related to higher input prices as well. We therefore remain committed to our medium- and long-term profitability targets.”
Vossloh will continue to strive for double-digit EBIT margins in all divisions in the medium term. In the long term, this also applies to the Group as a whole.
Werdohl, May 12, 2022
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Vossloh is a globally active technology Group dedicated for over 135 years to quality, safety, reliability, innovation and a focus on the customer. Vossloh’s comprehensive range of track-related products and services make the company a leader in the global market in this area. Vossloh provides a uniquely wide range of services: rail fastening systems, concrete ties, switch systems and crossings as well as innovative and increasingly digital-based services for the entire lifecycle of rails and switches. Vossloh uses its extensive understanding of rail infrastructure to meet the key customer need of track network availability.
Vossloh products are in use in more than 85 countries. With close to 80 Group companies in around 30 countries and over 35 production sites, Vossloh is a global company with a local presence. Vossloh is committed to sustainable governance and climate protection and makes an important contribution to sustainable passenger and freight mobility with its products and services.
The Group activities are organized into the three divisions of Core Components, Customized Modules and Lifecycle Solutions. In the 2021 fiscal year, Vossloh achieved sales of €942.8 million with approximately 3,600 employees.