Gelsenkirchen, November 10, 2021 – The Masterflex Group nearly reached the pre-corona level of 2019 with revenue of EUR 59.6 million (9M/2020: EUR 55.8 million, 9M/2019: EUR 62.5 million). Compared to the previous year, the Masterflex Group was able to generate a revenue growth of 6.8%. Although not all customer industries have yet recovered from after-effects of the corona pandemic, overall growth has continued to gain momentum.
Considered in isolation, the Group was already able to return to its pre-corona level in terms of revenue in the third quarter at EUR 20.7 million (Q3/2020: EUR 18.4 euros, Q3/2019: EUR 20.6 million). The high order backlog of the Group at EUR 15.4 million as of September 30, 2021 (December 31, 2020: EUR 9.4 million) underlines the sales and earnings targets. At the same time, the successful implementation of the „Back to Double Digit“ program (B2DD) is reflected in higher profitability. Thus, after nine months, the Masterflex Group is ahead of plan in terms of the targets set so far for the year 2021 as a whole.
Operating earnings before interest and taxes (operating EBIT) improved significantly to EUR 5.8 million (9M/2020: EUR 3.5 million) in the first nine months of 2021 - despite rising raw material prices and the related higher stockpilling of critical materials - resulting in a significant year-on-year increase of 64.7%. The Masterflex Group has therefore exceeded the earnings level before corona in the same period of 2019 (9M/2019: EUR 5.3 million) despite a lower revenue base, which is also reflected in a higher operating EBIT margin. The EBIT margin increased significantly to 9.7% in 9M/2021 (9M/2020: 6.3%, 9M/2019: 8.4%). The Masterflex Group is thus on track for a double-digit EBIT margin with its "Back to Double Digit" restructuring program.
Consolidated EBITDA reached EUR 9.3 million (9M/2020: EUR 6.6 million) in the nine-month period and consolidated net income EUR 3.8 million (9M/2020: EUR 1.4 million). Accordingly, earnings per share rose to EUR 0.39, compared with EUR 0.15 in the same period of the previous year.
Developments in the customer industries were heterogeneous. As in previous quarters, the traditional industrial hose business in the mechanical engineering and automotive sectors in particular showed strong demand momentum. Catch-up effects as a result of the restrained demand in the fiscal year 2020 as well as the conversion to more sustainable production processes had a positive impact on revenue development here. In this area, the Masterflex Group benefited in particular from the high level of material expertise and hose diversity in its portfolio.
Business in the medical technology sector continues to be characterized by the fact that, on the one hand, the special economic situation resulting from COVID-19-relevant equipment has leveled off and, on the other hand, there was a lack of growth impetus in the actual core business in medical technology. Postponements of surgical procedures are still the order of the day, which means that the pre-pandemic level has not yet been reached again for surgeries. In particular, investments and work for new projects and the start of series production of products already developed are still being postponed by a few customers. In line with the long-term orientation of the Masterflex Group, the product portfolio of medical technology hose solutions was consistently further expanded in the first three quarters of 2021. At the same time, production capacities were expanded in line with planning in order to be prepared for the expected growth and catch-up phase.
Activities in the aviation industry continued to progress at a low level. All other companies reported higher sales and earnings year-on-year. Positive growth impetus also came from Asia. However, the increasing shortage of raw materials slightly slowed down the growth momentum in the various sectors.
Dr. Andreas Bastin, CEO of the Masterflex Group: "We are very satisfied with our development in the first nine months. Despite all the challenges arising from the aftermath of the corona pandemic, the tense supply chains and the related rising raw material prices, our growth has stabilized and our profitability is developing in the right direction. We are more convinced than ever that, starting from a good fiscal year 2021, we will achieve the mid-term targets that we have communicated. We have a solid order intake and the fact that not all customer industries by any means have found their way back to growth leaves even further room for improvement."
Forecast adjusted upwards
At the end of the third quarter, the Masterflex Group's revenue forecast for the year, which was based on an increase in revenue of 2% to 5%, is above the upper end of the target range. Based on a solid order situation, it is foreseeable that the Masterflex Group will perform better than originally planned in terms of revenue for the full year 2021, which allows the annual targets to be specified and increased.
For this reason, the Management Board expects revenue within a range of EUR 76 million to EUR 78 million for the full year 2021. This equates to year-on-year revenue growth of 5% to 8%. Operating EBIT for the full year 2021 is expected to be significantly above the level of the fiscal year 2020 (EUR 3.2 million) and above the level of the fiscal year 2019 (EUR 5.1 million) – in line with the business development in the first nine months of the current fiscal year, which underscores the successful implementation of the B2DD program given the lower revenue base compared to 2019. Therefore, the Management sees the Masterflex Group full on track to achieve a double-digit EBIT margin again from 2022 on, as previously communicated.
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The 9-month report as of September 30, 2021 is available at masterflexgroup/investor-relations.