Investing.com -- Shares of Jungheinrich AG (ETR:JUNG_p) (ETR:JUN3) climbed 3.8% after the company provided an upbeat outlook for 2025, projecting orders, revenues, EBIT, and free cash flow that surpassed analysts’ expectations.
The forecast assumes a stable macro and geopolitical environment, steady interest rates, and incorporates recent collective bargaining agreements that have led to higher personnel costs.
The company reported incoming orders of €1,380 million, a 1% increase YoY and slightly ahead of consensus estimates of €1,368 million. Orders for new trucks were down 1% YoY and 5% from the previous quarter, reflecting the challenging macroeconomic conditions.
However, growth in aftersales service helped offset the decline in new business, with units ordered rising 3% YoY for the fiscal year 2024.
Jungheinrich’s revenues were reported at €1,469 million, down 4% YoY but 1% ahead of consensus at €1,458 million. The decrease was attributed to weakness in key markets, including Germany, which saw a 3% decline for the fiscal year, and the Americas, which experienced a 14% drop.
The company’s EBIT matched analyst expectations at €114 million, equating to an EBIT margin of 7.8%. Jungheinrich’s efforts to safeguard earnings through cost-saving measures and price increases have borne fruit, with personnel costs down 1% for the fiscal year, primarily in Germany.
Free cash flow for the fiscal year 2024 was a highlight, reaching €431 million, significantly exceeding the guidance of over €300 million. This improvement was driven by a substantial reduction in working capital from 20.5% to 18.7% of revenues.
The dividend per preferred share also exceeded expectations, coming in at €0.80 compared to the consensus of €0.76.
Jefferies analysts commented on the results, noting the impact of a weak macro environment, particularly in Germany, which led to results in the lower half of the initial 2024 guidance.
"Cost measures initiated last year clearly benefited margins. JUN3 released ambitious 2025 targets with orders +9% and revs +6% YoY at mid-point with slight margin progress leading to EBIT 5% ahead and FCF DD ahead, likely implying a decent market recovery in Europe and the US."
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