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Led by Turkey, H1 2013 orders skyrocket at Rieter
25
Jul '13
Market recovery continues from the second half of 2012, above all in Turkey – substantial rise in order intake thanks to strong positioning and attractive product offering – significantly higher sales than in 2nd half of 2012 – EBIT and operating margin as expected – further progress with investment program 2012/2013.

In steadily improving market conditions, Rieter achieved an order intake in the first half of 2013 of 711.4 million CHF (1st half of 2012: 404.1 million CHF). Particularly in Turkey, demand was much greater than in the prior year. Sales of 478.1 million CHF were significantly higher (+19%) than in the previous six months but slightly lower (-2%) than in the first half of 2012.

Operating result before interest and taxes (EBIT) and operating margin developed according to expectations dur-ing the period under review. EBIT amounted to 17.1 million CHF, equivalent to 3.6% of sales (1st half of 2012: 31.5 million CHF or 6.5% of sales). The lower EBIT than in prior year is largely attributable to smaller profit margins on orders closed the year before.

There were no non-recurring divestment gains as in the prior year period. Rieter closed the first half of 2013 with a net profit of 5.0 million CHF or 1.0% of sales (1st half of 2012: 21.5 million CHF or 4.4% of sales). In the period under review Rieter completed major steps in the growth investment program 2012/2013 announced in spring 2012.

Recovery of the global market for short-staple fiber machinery and components in the second half of 2012 has continued in 2013. This positive trend applied to all the geo-graphical markets of relevance for Rieter, to different degrees but particularly in Tur-key, supported by a government subsidy program that benefited spinning mills.

High demand was also recorded in various Asian countries. Business in India and China showed a slight upturn in the first half of 2013, but the financing situation for Rieter customers in these countries remains challenging. Spinning mill capacities in the USA were renewed thanks to a favorable cost structure in this sector.

Rieter was able to make the most of this overall improvement in market conditions thanks to an attractive product offering and strong market positioning worldwide. Order intake during the period under review totaled 711.4 million CHF, 76% and 63% higher than in the first and second half of 2012 respectively.

This was mostly attribut- able to orders received by Rieter in Turkey. Rieter was able to increase order intake in China with market-specific products, while in India there was above all a good demand for components. Overall order backlog per June 30, 2013 totaled around 780 million CHF.

The gratifying demand for Rieter products confirms the soundness of its innovation and expansion strategy. Thanks to its market-specific product program, Rieter holds a strong position worldwide in the cyclical market for textile machinery and compo-nents. Spinning mill customers in all main markets increasingly prefer highly auto-mated machinery and components that enable greater productivity and better yarn quality with lower energy consumption.

Rieter sales for the first half of 2013 totaled 478.1 million CHF, 2% less than in the prior year period (487.3 million CHF) but 19% higher than in the second half of 2012. Sales were attributable to various countries, with business activities broadly based regionally.

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