Bucher Industries (BUCN) H1 2024 earnings summary

Executive summary

• Order intake and net sales declined significantly year-over-year, with agriculture most affected and all divisions experiencing a downturn; order intake fell 22.1% and sales dropped 11.1% to CHF 1.7 billion.

• Profitability was impacted by lower capacity utilisation, but operating profit margin remained above 10% and Bucher Municipal achieved a strong improvement in EBIT margin.

• The group maintained a solid financial position with an equity ratio of 62% and net cash of CHF 186 million, continuing investments in organic growth and innovation.

• Cost-saving measures were implemented, and leadership changes included a new Chairman and a new Division President for Bucher Hydraulics.

Financial highlights

• Order intake for H1 2024 declined 22% to CHF 1.2 billion; net sales fell 11.1% to CHF 1,724 million.

• Operating profit (EBIT) was CHF 178 million (10.3% margin), down 27.9% year-over-year.

• Profit for the period was CHF 145 million, a 27% year-on-year decline; EPS fell 27.3% to CHF 14.07.

• Net cash position at end of June was CHF 186 million; operating free cash flow was negative due to seasonal factors and dividend payments.

• CAPEX for H1 was CHF 59–61 million; R&D costs stable at CHF 67 million (3.4% of net sales).

Outlook and guidance

• Group expects lower sales and profit for 2024, with a mid- to high-single-digit percentage sales decline and a lower but double-digit operating profit margin.

• Demand is expected to remain subdued in H2 2024, especially in agricultural machinery, with no significant positive impact from US election subsidies.

• Destocking in agricultural machinery is expected to last at least another six months, possibly into 2025.

• Ongoing optimisation and investment in innovation to continue.