Vossloh continues its successful course with record orders received and increased profitability

• Orders received at €1,025.7 million exceeding the €1 billion mark for the first time in the nine-month period
• Sales revenues of €859.6 million after nine months down on the exceptionally high prior-year figure, as anticipated
• EBIT at previous year's level despite the sales decline and transaction costs for the ongoing acquisition of Sateba; double-digit EBIT margins in all divisions within the nine-month period
• Outlook for sales revenues and EBIT in the current financial year confirmed

The Vossloh Group continued its positive business development in the third quarter of 2024. Orders received exceeded the €1 billion mark for the first time in the first three quarters of a financial year, totaling €1,025.7 million. Compared to the previous year's figure of €945.5 million, this corresponds to an increase of 8.5%. At €852.3 million, the order backlog at the reporting date of September 30, 2024, was 9.0% higher than the previous year's figure of €782.0 million.

Group sales amounted to €859.6 million in the reporting period and fell short of the record sales of €925.9 million set in the first nine months of 2023, as expected. The 7.2% decline is primarily due to project-related lower sales revenues in the Core Components division, as anticipated, mainly in Mexico and China.

EBIT totaled €77.1 million and was thus marginally higher than the previous year's figure of €76.9 million. Against the backdrop of lower sales revenues and substantial transaction costs in connection with the planned acquisition of the Sateba Group, which were partially offset by positive nonrecurring effects in individual divisions, this is a remarkable development. The Group's EBIT margin increased by 0.7 percentage points to 9.0%. Profitability reached a double-digit level in all divisions in the nine-month period. The Group net income increased by €12.7 million to €56.6 million, primarily due to noticeably lower tax and interest expenses. Earnings per share amounted to €2.70 and were therefore €1.02 higher than the previous year's figure of €1.68. At €34.2 million, free cash flow has not yet reached the high level of the prior-year period of €48.0 million, although it improved significantly in the third quarter to €38.9 million and Vossloh also expects a clearly positive free cash flow in the final quarter.

The Vossloh Group's net assets and financial position further improved as well. Equity reached a level of €665.2 million as of the reporting date on September 30, 2024 (previous year’s reporting date: €636.3 million). The equity ratio improved by 1.3 percentage points to 46.3%. Net financial debt including lease liabilities fell by €10.6 million to €228.4 million compared to the figure at the end of the first nine months of 2023, mainly due to the positive free cash flow during the last 12 months.

"I am very pleased that we have continued our course of success in the third quarter. In addition to our strong financial performance, we have also made impressive progress in other areas. These include the completion of the acquisitions of the two service providers FAS in France and STG in Sweden as well as the agreement to take over the concrete tie manufacturer Sateba, which would represent the largest acquisition in Vossloh's history. We were also able to further expand our business relationship with Deutsche Bahn, for example, with the signing of two framework agreements with an order volume of well over €100 million. Finally, at the leading InnoTrans trade fair in Berlin, we presented key technical innovations, the expansion of our product portfolio to include under sleeper pads and demonstrated our leading role in the areas of digitalization and sustainability. Vossloh is excellently positioned to benefit in the best possible way from the existing growth potential of the rail infrastructure market," CEO Oliver Schuster says.

Core Components again with a very high level of profitability
Orders received in the Core Components division amounted to €414.0 million in the first nine months of 2024, down on the previous year's high figure of €448.3 million. The main reason for the decline were previous year’s orders in Mexico for the Fastening Systems and Tie Technologies business units. In contrast, the Core Components division's order backlog increased noticeably and amounted to around €317.7 million as of September 30, 2024 (September 30, 2023: €295.3 million). Sales revenues in the division amounted to €325.2 million in this year's reporting period, significantly below the previous year's figure of €418.6 million. The decline had been expected and is due to lower sales revenues in China and Mexico in the Fastening Systems business unit as well as lower revenues at Vossloh Tie Technologies in Australia and Mexico. Vossloh Fastening Systems contributed sales revenues of €205.4 million, significantly below the previous year's figure of €283.8 million, while the Tie Technologies business unit generated €134.0 million after €155.3 million in the first nine months of 2023.

However, EBIT in the Core Components division only fell from €57.3 million to €49.8 million. As a result, this led to a noticeable increase in the EBIT margin from 13.7% to 15.3% in the reporting period. This positive development was due not least to the increased profitability in the Tie Technologies business unit. Profitability in the division was also positively influenced by the release of some provisions.

Customized Modules with record EBIT and double-digit EBIT margin
Orders received in the Customized Modules division increased by 27.6% year-on-year to €476.4 million (previous year: €373.5 million). This positive development is in particular due to increased demand primarily in Southern Europe, but also in North America, Asia and Africa. At €500.6 million, the order backlog as of September 30, 2024, was also significantly higher than the previous year's figure of €437.3 million. At €399.5 million in the first nine months of 2024, sales revenues in the Customized Modules division did not reach the previous year's level of €411.2 million. Despite the lower sales revenues, EBIT reached a very high level of €40.5 million (previous year: €28.1 million). This was primarily caused by higher earnings contributions at the locations in France and Luxembourg as well as a positive effect from retroactive price adjustments. The EBIT margin increased from 6.8% to 10.1% and reached a double-digit figure after nine months.

Lifecycle Solutions achieves record levels of sales revenues and EBIT
Orders received by the Lifecycle Solutions division in the first nine months of 2024 amounted to €158.2 million, exceeding the previous year's figure of €146.0 million by 8.3%. The order backlog decreased from €58.1 million on September 30, 2023, to €46.3 million at the end of the reporting period. The framework agreements signed with Deutsche Bahn in September with a total value of well over €100 million will only be recognized as orders received when the customer makes call-offs under these agreements. Sales revenues in the Lifecycle Solutions division increased by 22.3 percent year-on-year from €121.3 million to €148.4 million. Among other things, this was due to higher sales revenues from Track Supply and the Maintenance (including High Speed Grinding) subsegments. The companies STG and FAS, which were acquired in the course of the year, also made their first sales contributions. The division's EBIT rose significantly from €7.4 million in the previous year to a new high of €15.4 million in the first nine months of 2024, while the EBIT margin also increased significantly from 6.1 percent to 10.4 percent. This division achieved a double-digit EBIT margin in a nine-month period.

Employees
As of September 30, 2024, the Vossloh Group worldwide had 4,267 employees (previous year: 4,035 employees). This means that the number of employees has risen by 232 people or 5.7% in the past twelve months.

Outlook for the current financial year 2024
Vossloh confirms the existing forecast for the current financial year. From today's perspective, the Executive Board continues to expect sales revenues of between €1.16 billion and €1.26 billion. The persistently positive market environment should mean that the high level of sales in 2023 can be kept roughly stable – based on the mid-point of the guidance –, although significant new construction projects ended in late 2023. In terms of earnings, EBIT is still expected to increase to between €100 million and €115 million, despite expected transaction costs of around €10 million in connection with the planned acquisition of Sateba. Based on the mid-point of the sales guidance, this results in a forecast corridor for the EBIT margin of between 8.3% and 9.5%.