“Jungheinrich will emerge strengthened from the coronavirus crisis”, said Dr Lars Brzoska, Chairman of the Board of Management of Jungheinrich AG, at the company’s Annual General Meeting today. The shareholder meeting took place virtually for the first time due to the Covid-19 pandemic. Shareholders of Jungheinrich AG from across the globe were able to follow the event live online. “The protection of our shareholders and the health of our employees is our top priority. This year, we are practising social distancing as an expression of our assumed responsibility”, said Brzoska.
Jungheinrich can look back on a respectable 2019. Despite an economic slowdown in the second half of the year, the company reported revenue of more than €4 billion for the first time. “This is a milestone in the history of Jungheinrich”, said Brzoska. Although the company experienced one-off negative impacts on earnings, Jungheinrich achieved EBIT of €263 million. Profit or loss increased compared to 2018, cash flow from operating activities increased significantly to €345 million and net debt was reduced substantially.
Programme of measures to improve efficiency
Brzoska said that the Jungheinrich Board of Management had seen increasing signs of an emerging recession starting in late summer 2019. “Over the course of the second half of 2019, it became increasingly clear to us that the economic boom of recent years had come to an end”, he said. This prompted Jungheinrich to develop a comprehensive programme of measures to improve efficiency and hedge risks, making itself weatherproof early on. Jungheinrich benefited from these measures when the Covid-19 pandemic plunged the global economy into an unprecedented crisis at the beginning of this year. “Due to the measures we took, we were in a position to react very quickly to the new, aggravated situation and to ensure the Group’s ability to act”, said Brzoska.
Thank you to employees
The Chairman of the Board of Management took the Annual General Meeting as an opportunity to thank Jungheinrich’s employees for their commitment during the Covid-19 pandemic. “The Jungheinrich workforce has shown character as a team during this crisis and done outstanding work under difficult conditions”, said Brzoska. He extended his special thanks to those employees who have not been able to work from home.
Intralogistics is systemically relevant
In his speech, Brzoska highlighted the systemic importance of the intralogistics sector when it comes to safeguarding the supply of communities, particularly during the coronavirus crisis. “We help maintain supply lines for people and companies and have been doing our part during the crisis to prevent the German, European and global economies from grinding to a halt. We are proud of that.” Without Jungheinrich’s trucks, system solutions and services, supermarket shelves would be empty today.
First half of 2020
Jungheinrich AG released its figures for the first half of 2020 on 11 August. Due to the crisis, orders for new trucks in the first half of 2020 were, at 53.9 thousand trucks, significantly below the previous year’s level. At €1.81 billion, the value of the Jungheinrich Group’s incoming orders also remained lower than that of the previous year. Nonetheless, the company achieved EBIT of €95 million and EBIT return on sales of 5.3 per cent. “This is a very good half-year result for a crisis year like this one”, Brzoska declared.
Healthy statement of financial position
Cash flow from operating activities came to around €201 million for the period from January to June 2020, doubling the figure from the previous year. Furthermore, Jungheinrich was also able to reduce net debt from €172 million from the end of 2019 to €36 million despite the crisis. This is a reduction of €136 million. At the same time, Jungheinrich has a very solid liquidity reserve and a very healthy statement of financial position.
Stable dividend policy
In light of this performance, the Jungheinrich Board of Management proposed that the company’s stable dividend policy be continued this year despite the crisis and that the dividend of €0.46 per ordinary share and €0.48 per preferred share anticipated in the 2019 Annual Report be upheld. The ordinary shareholders approved this proposal.
Jungheinrich published a forecast for 2020 on 22 July. Based on this forecast, the company expects incoming orders to range between €3.4 billion and €3.6 billion. Group revenue is also expected to range between €3.4 billion and €3.6 billion. According to current estimates, earnings before interest and taxes (EBIT) in 2020 should come to between €130 million and €180 million. EBIT return on sales is expected to be in a range of 3.8 per cent to 5.0 per cent. Brzoska said: “We have set the course for a continued successful future through our determined response to the first signs of crisis. Today, we can say that, so far, Jungheinrich has come through the biggest global economic crisis in decades as well as can be expected under the circumstances. This gives us confidence for the future.”
New Group strategy
Brzoska announced that a new Group strategy would be unveiled in the fourth quarter of 2020. In it, Jungheinrich will address the challenges of a changing market and competitive environment while also actively using the opportunities they bring. To this end, the company will concentrate on digitalisation, automation, efficiency, energy systems, sustainability and the expansion of its global footprint. “Our goal is to further expand our global market position and to create value sustainably for all our stakeholders”, explained Brzoska.
Forklift donation to Hamburger Tafel e.V.
Jungheinrich traditionally provides shareholders with a meal at the close of the Annual General Meeting. As this year’s meeting was a purely virtual event, it was not possible to continue with this tradition. Instead, Jungheinrich is using this catering budget to support people who have limited money for food during this unusual period: the company is donating a forklift truck to the Hamburger Tafel e.V. food bank. The Tafel requested an EJC 220 pallet stacker, which is currently being prepared in Jungheinrich’s Dresden factory and will be delivered soon. “We are delighted to be able to support a wonderful social institution in this way”, said Brzoska.