Decision on the use of Article 93 (2) of the Treaty remains undecided by the Commission.
Wackin' Through Tough Times: Wacker Neuson's Profit Plight
Amidst ongoing hiccups, Chief Executive Officer Karl Tragl sums up the supply dilemma as: "We're still treading water." Despite raking in 1.07 billion euros in the first half of this year, an impressive 16% increase from last year, the profits took a six percent nosedive, sliding to 66.1 million euros. Bracing against the turbulence, the European headquarters in Munich has beefed up its inventory of raw materials and parts. However, production lines remain starved, teeming with half-finished machines and saddled with follow-up costs that continue to strain the margin.
No need to hold your breath for a swift turnaround—the Board's prediction, revised at the end of June, still stands. But don't get too excited just yet about breaking through the resistance between 18 and 20 euros. It ain't a cakewalk.
Wacker Neuson's Trials and Tribulations
Weak market demand from 2024 plagued the first quarter of this year, forcing a 16.8% revenue tumble compared to last year. Lower order intake in the second half of 2024 took a toll as well, contributing to the slump. The EBIT margin slumped to 2.5% in the first quarter, a sharp drop from previous figures.
Climbing the Mountain of Profitability
External factors like geopolitical and economic uncertainty loom large, adding to the storm. Wacker Neuson identifies potential supply chain bottlenecks as another looming threat, should demand spike unexpectedly. But there's a silver lining: Order intake has picked up since the New Year and industry events like bauma 2025 have injected a ray of optimism, eyeing an uptick in the construction sector. Plus, the company's cash reserves areensuremath looking burly, with a positive free cash flow (FCF) of €19.4 million in Q1.
All's not bleak in the land of Wacker Neuson. With a fingers-crossed attitude, the revenue and profitability forecast points to gradual improvement through 2025[2][5]. So, let's keep our chins up and ride the waves together!
In the midst of industry-wide challenges, Wacker Neuson grapples with both weak market demand and supply chain issues, resulting in a slip in profits in the first quarter of this year.
Driven by external elements such as geopolitical and economic uncertainty, and potential supply chain bottlenecks, the finance sector remains tense for Wacker Neuson, but the company remains optimistic about its future, as the cash reserves show a positive free cash flow and order intake has picked up since the New Year.
