Ponsse’s Interim Report for 1 January – 30 September 2023
July-September (continuing operations):
- Net sales amounted to EUR 169.2 (178.5) million
- Operating profit totalled EUR 6.5 (13.0) million, equalling 3.9 (7.3) per cent of net sales
January-September (continuing operations):
- Net sales amounted to EUR 579.0 (530.5) million
- Operating profit totalled EUR 33.4 (34.9) million, equalling 5.8 (6.6) per cent of net sales
- Net result was EUR 22.4 (24.2) million
- Earnings per share were EUR 0.80 (0.86)
- Order books stood at EUR 278.1 (365.5) million at the end of period under review
- Cash flow from business operations was EUR -4.8 (-50.8) million (continuing and discontinued operations)
- Equity ratio was 54.8 (56.7) per cent at the end of period under review (continuing and discontinued operations)
- Ponsse issued a new performance guidance on October 18th, 2023: The company’s euro-denominated operating profit in 2023 is expected to be on par with the comparable operating profit of its continuing operations in 2022 (EUR 46.6 million).
- Ponsse has classified the Russian operations subject to trade as assets held for sale and reported them as discontinued operations. Unless otherwise specified, the figures presented in this interim report refer to continuing operations.
President and CEO Juho Nummela:
The weakening demand in the forest sector and general uncertainty led to a decrease in the demand for PONSSE forest machines during the last quarter. During the third quarter, order intake totaled roughly EUR 153.1 million. At the end of the period under review, the company’s order books stood at EUR 278.1 (365.5) million.
Our customers’ business situation is decent, but logging volumes for the current year are expected to decrease. The weakening of the market is reflected in a reduction in the order books whilst the factory’s production volumes still remain close to a normal level. The availability of parts and components has improved significantly as the general demand has decreased in our suppliers’ business areas.
The company’s net sales amounted to EUR 169.2 (178.5) million during the last quarter. New machine invoicing didn’t reach last year’s numbers, but we were able to both improve the delivery of used machines and boost their net sales. Our technology company, Epec, managed to grow a little. During the past quarter, we were able to finish the sales process of our Russian subsidiary.
Our relative profitability during the past quarter was poor, 3.9 (7.3) per cent. The main factors affecting our profitability were the persistent inflation, the operating expenses that grew faster than what the net sales developed, and the slower-than-expected improvement of the operative challenges of our subsidiary, Ponsse Latin America Ltda. Entering a weakening business cycle, also the discontinuation of our Russian operations and the challenges in the organization’s overall cost structure are reflected in the company’s profitability. The growth in our net sales originates from the less profitable market areas.
The company’s cash flow was EUR -4.8 (-50.8) million. Part of our capital is still temporarily tied to raw material stocks and, especially, to used machine stocks. The growth of the used machine stock took a turn during the quarter and started decreasing, but the used machine stock rotation is still on a too poor level.
In order to secure the fulfilment of our strategy and goals, we are developing the company’s operative model. We want to ensure even stronger customer service, respond to market changes, and secure the growth of the company’s profitability in the changed business environment. The development of the operative model will have a clear impact on our competitiveness. Ponsse evaluates investments very carefully, prioritizes operations, and will cut costs. The investments are made in the development of new products and technologies, the Group’s information systems, and digital services.
