Mixed results for Wacker Neuson

The Wacker Neuson Group has increased revenue and earnings for the third quarter of 2016 against last year.

However, results for the year to date were slightly below 2015 as the Germany-based compact equipment manufacturer only partly offset the drop suffered in the first six months.

Group revenue rose 2% year on year to €315.7 million (US$344.8 million), or 3% when taking currency effects into account.

Geographically, Europe was up 9%.

This was mainly due to stable demand from construction in German-speaking countries as well as France, Denmark, Sweden and Benelux.

Revenue in the Americas fell 15%. The company said high levels of dealer and rental inventory dampened demand in North America, and cheap used equipment was also a factor.

Despite growth in China, falling demand in Australasia meant an overall drop of 23% in Asia-Pacific.

For the nine months to the end of September, revenue was close to its 2015 level, at €1,013.5 million ($1,107 million) compared to €1,017.4 million ($1,111 million) a year ago.

“This is undoubtedly a year of transition for the group, during which we have optimised processes and structures and also laid the foundation for future growth,” said CEO Cem Peksaglam.

“Levels of uncertainty and volatility remain high in our markets. Business in North and South America, which accounts for 21% of our group revenue, developed below our expectations. So did markets in Australia and Africa. However, we expect Europe to remain robust,” he added.

The company said it expects revenue and earnings for 2016 to be at the lower end of its published forecast.

That said revenue would be between €1,375 million ($1,502 million) and €1,425 million ($1,556 million) with an earnings before interest and taxation margin of 6.5 and 7.5%).

Total investments for 2016 are expected to be around €120 million ($131 million).