Vossloh achieves record sales and significant increase in EBIT in the 2023 financial year

Vossloh can look back on an extremely successful financial year 2023, which was characterized by significant sales growth, a substantial increase in EBIT and a considerable improvement in free cash flow.

The company's order situation remains positive: Orders received almost matched the previous year's record figure of €1,217.4 million. The winning of important multi-year framework agreements, which are not directly reported as orders received, also underlines the sales success in the financial year 2023. These include, for example, the expanded cooperation with Deutsche Bahn in the switch business and the supply of switch systems to the Danish rail network operator Banedanmark. At around €761.2 million, the order backlog as of December 31, 2023 remained well above the historical average in the infrastructure business.

Vossloh achieved a remarkable sales growth of 16.1% in 2023 and reached a new all-time high in the rail infrastructure business with group sales of €1,214.3 million. The home market of Germany made a significant contribution to the increase with sales growth of almost 40%. The Vossloh Group's EBIT reached €98.5 million in the year under review, representing a significant increase of 26.2%. The company's performance thus significantly exceeded the original expectations for the 2023 financial year. Sales revenues and EBIT were at the upper end of the guidance ranges last raised in October 2023.

The significant improvement in free cash flow, which increased from €27.9 million in the previous year to €70.9 million in the 2023 reporting period despite higher capital expenditure, is also particularly noteworthy. In addition to the strong operating performance, this is primarily due to a significantly lower increase in working capital compared to the previous year. The group-wide working capital program Cash4Growth, which was launched in spring 2023, made its first positive contributions here. Thanks to the significant improvement in free cash flow, net financial debt fell to €219.5 million at the end of the reporting period (December 31, 2022: €237.5 million).

"The year 2023 was once again characterized by a variety of challenges, some of which had a significant impact on the global economy. As a globally active company, we have to deal with increasing complexity on a daily basis, act flexibly and quickly and constantly adapt to changing conditions. And this is precisely what we did remarkably well once again in 2023. Despite these difficult conditions, we achieved a new all-time high in sales revenues and significantly increased our EBIT to just under €100 million," says Oliver Schuster, Chief Executive Officer of Vossloh AG, adding: "Vossloh's success is crucially linked to our technological leadership, our reliability, our uniquely comprehensive product and service portfolio and our forward-looking, sustainable and crisis-resistant business model. In addition, we have a team that brings its passion, expertise and innovative strength to bear every day in order to provide our customers with the best possible support. I would like to expressly thank all Vossloh employees for this and I am delighted that together we are advancing the ecologically and economically sensible transformation of transportation worldwide."

Core Components with significant increase in sales and higher profitability
Orders received in the Core Components division amounted to €542.7 million in 2023, only slightly below the previous year's high level of €554.4 million. The order backlog as of December 31, 2023 amounted to €262.1 million (previous year's reporting date: €285.4 million). Sales revenues in the division increased by 13.4% to €546.7 million (previous year: €482.1 million). While the Fastening Systems business unit only recorded comparatively slight sales growth of 2.4%, the Tie Technologies business unit made a significant contribution to the positive revenue development with growth of 43.3%. The Core Components division generated EBIT of €69.8 million in the 2023 financial year (previous year: €43.7 million). The significant increase of €26.1 million was primarily due to higher sales revenues and a higher-margin project mix.

Customized Modules achieved new sales record
Orders received remained at a high level at €524.1 million, but did not quite reach the previous year's historic high of €563.3 million. The order backlog at the end of 2023 amounted to €461.3 million after €488.1 million at the previous year's reporting date. Sales revenues in the Customized Modules division increased significantly during the reporting period by €81.3 million to €537.4 million (previous year: €456.1 million), a new all-time high. Higher sales revenues, particularly in Italy, Serbia and Germany, contributed to the increase. EBIT rose by 14.8% to €42.7 million (previous year: €37.1 million).

Lifecycle Solutions with significant increase in sales
Orders received during the 2023 reporting period amounted to €175.5 million, noticeably exceeding the previous year's figure of €162.3 million. At €40.8 million, the order backlog at the end of 2023 was up on the previous year's figure of €37.5 million. Sales revenues in the Lifecycle Solutions division also increased, rising by 20.3% to €163.5 million and thus reaching an all-time high. Germany and the Netherlands in particular saw a significant increase in revenue. A framework agreement with Deutsche Bahn for preventive rail maintenance (High Speed Grinding) and the Track Supply subsegment contributed to this. The division's EBIT amounted to €11.6 million in the reporting year (previous year: €11.5 million).

EU taxonomy figures confirm Vossloh's sustainable business model
The EU Taxonomy Regulation is applied for the third time in the 2023 financial year. According to this standardized classification system for environmentally sustainable economic activities, 100% of Vossloh's sales revenues were again classified as taxonomy-eligible. 63% (previous year: 64%) were assessed as taxonomy-aligned and thus as ecologically sustainable activities. Vossloh is one of the best business enterprises in Germany in both categories.

Employees
During the 2023 financial year, the average number of employees in the Vossloh Group amounted to 3,999 (previous year: 3,794), with the number of employees increasing in all divisions.

Outlook for the year 2024
From today's perspective, the Executive Board of Vossloh AG expects to be able to generate sales revenues of between €1.16 billion and €1.26 billion in the current financial year. Overall positive market demand will therefore mean that the high sales level - based on the mid-point of the guidance - can be kept more or less stable, despite the completion of major projects for new lines. With regard to the operating result, Vossloh expects a further increase in EBIT in a corridor of €100 million to €115 million. Based on the mid-point of the sales guidance, this results in an EBIT margin of between 8.3% and 9.5%.

Due to the good order situation and the positive business development in the 2023 financial year, the Executive Board and Supervisory Board will propose to Vossloh AG's Annual General Meeting to distribute a dividend of €1.05 per share (previous year: €1.00 per share).