Against the backdrop of a difficult environment in the agricultural machinery and commercial trailer industries, the Krone Group, based in Germany, reports ending the 2017-18 fiscal year with record revenue of about 2.1 billion euros (US $2.37 billion)—a “significant increase” from the previous year.
The company’s home market accounted for 582.9 million euros ($658.6 million), a rise of 13.1%. About 67.4% of the domestic sales were accounted for by the commercial vehicles division and 32.6% by the agricultural machinery business.
Sales in markets outside Germany equaled 1.5 billion euros ($1.7 billion), which is up 12.4% over the previous year. Nearly 71% of these export sales were generated by the commercial vehicles business and 29.1% by the agricultural machinery division. As such, the international business accounts for 72.7% in total sales, which is roughly equivalent to the level of the previous year.
The Krone Group says it employed 4,897 staff in the 2017-18 fiscal year (4,497 permanent staff in the previous year). This figure includes 278 apprentices (previously 243). An increase in business activities and expansion of our sales networks in both divisions accounts for the increase in permanent staff members.
Commercial Vehicles S.A. employed 2,694 people in the past fiscal year, and Krone Agriculture had 2,063 staff members, whereas 140 members were on the payroll of the holding company, working at various offices and locations of the group.
In the 2017-18 fiscal year, the balance total increased to 1.13 billion euros ($1.28 bilion). Total investments of 67 million euros ($75.8 million) and changes in the consolidated group of 1.1 million euros ($1.2 million) are offset by depreciation of 28 million euros ($31.7 million) in both business segments. The growth mainly results from a number of investments in various production sites.
Liquidity increased by 26.5 million euros ($29.97 million) to 147.3 million euros ($166.6 million). This was mainly accounted for by the decrease in receivables from goods delivered and services provided, and the increased annual surplus.
On account of the annual surplus, equity capital increased from 486.1 million euros ($549.6 million) to 533.8 million euros ($603.6 million) on the balance sheet date. The equity ratio increased slightly, from 47.1% to 47.2%, despite the higher balance sheet total.
In the same fiscal year, the medium- and long-term debt capital increased to 325.6 million euros ($368.1 million) from 290.4 million euros $328.4 million). The Group currently has 859.7 million euros ($972.1 million) available in the form of medium- and long-term capital. This covers fixed and stock assets, as well as many of the receivables.
Investing in future growth
Total investments by the Krone Group in the past fiscal year amounted to 67.0 million euros $75.8 (million), 53.8 million euros ($60.8 million) of which were spent on tangible assets, 4.9 million euros ($5.5 million) on intangible assets and 8.3 million euros ($9.4 million) on financial assets.
The highest single investment of about 40 million euros ($45.2 million) was the new coating centre at the Werlte production site. Further investments in the reported period were made in the new and automated component manufacturing line at the Herzlake site. The Spelle site implemented various measures to expand its manufacturing and assembly capacities. In addition to investing in modern clamping and quick-swapping systems that reduce set-up times, the division advanced the development of a universal tool management system.
Bernard Krone, managing partner of the Krone Group, said he’s delighted with the company performance in the 2017-18 fiscal year.
“The repeated increase in sales bears testimony of our successful strategy of positioning ourselves as a provider of ... comprehensive services for commercial trailers and agricultural machines,” he said. “Furthermore, as a medium-sized and family-run enterprise, we benefit from being quick, flexible and innovative. An equity ratio of 47% gives us a solid financial foundation (and) the entrepreneurial leeway to implement further innovations, and hence continue the path of sustained growth.
“The diversification in commercial trailers and farm machinery offers us exceptional opportunities as we develop practical solutions for both types of products, helping our customers around the globe to meet their challenges. A rapidly growing world population calls for an increased and more efficient food production, and this inevitably involves an increase in freight transportation.
“Digitization plays a key role in this context. Already today, Krone provides a wide range of future-oriented solutions for smart farm machines and smart trailers.”