A 9.5-Percent First Quarter Revenue Increase for Wacker Neuson
The Wacker Neuson Group posted €370.5 million in the first quarter of 2018 (about U.S. $439 million) compared to €338.5 million in the first quarter of 2018, a 9.5-percent increase. All regions and business segments reported a rise in revenue. The growth was primarily driven by continued rising demand in the North American and European construction markets as well as strong performance from the Weidemann and Kramer brands in the agriculture sector.
Europe is the largest market for the Group, accounting for 72 percent of the business. Revenue rose 8 percent in Europe to €268 million in the first quarter compared to €248 million in the same period in 2017. Revenue in the Americas grew 13.6 percent from €81 million to €92 million.
“In the U.S., we benefitted from a number of trends, including increased investments from rental chains stocking up on worksite technology such as generators and heaters,” said Martin Lehner, CEO of Wacker Neuson. “Our performance was also bolstered by strong sales of our U.S.-produced skid-steer loaders."
Wacker Neuson did quite well in the Asia Pacific region, jumping 16 percent to €11 million. Growth was particularly strong in China, where the Group began production of mini-excavators in January of this year.
Profit before interest and tax (EBIT) grew 61 percent to €23 million in the first quarter, compared to €14 million a year ago. The rise in revenue and an improved cost structure had a positive impact on earnings. However, profit was also dampened by a more unfavorable regional and product mix and production delays.
Increased raw material prices, higher personnel and transport costs as well as new environmental, health and safety regulations for equipment have driven up costs for the company. To maintain its capabilities, Wacker Neuson will be increasing sales prices across all product segments and brands as of July 1, but only passing on part of the cost increases to customers.
The company said it generated great interest in its new electric excavators and vibratory plates at the Intermat Show in Paris.
Wacker Neuson confirmed its guidance for fiscal 2018 and expects revenue to rise by 8 to 11 percent to between €1.65 and €1.7 billion for the full year.
About the Author
Michael Roth
Editor
Michael Roth has covered the equipment rental industry full time for RER since 1989 and has served as the magazine’s editor in chief since 1994. He has nearly 30 years experience as a professional journalist. Roth has visited hundreds of rental centers and industry manufacturers, written hundreds of feature stories for RER and thousands of news stories for the magazine and its electronic newsletter RER Reports. Roth has interviewed leading executives for most of the industry’s largest rental companies and manufacturers as well as hundreds of smaller independent companies. He has visited with and reported on rental companies and manufacturers in Europe, Central America and Asia as well as Mexico, Canada and the United States. Roth was co-founder of RER Reports, the industry’s first weekly newsletter, which began as a fax newsletter in 1996, and later became an online newsletter. Roth has spoken at conventions sponsored by the American Rental Association, Associated Equipment Distributors, California Rental Association and other industry events and has spoken before industry groups in several countries. He lives and works in Los Angeles when he’s not traveling to cover industry events.