NEUTRAUBLING (dpa-AFX) - Filling and packaging equipment manufacturer Krones performed well in the second quarter despite the recent weakness of the economy in many countries. Sales and earnings increased. "Following a successful first quarter, the second quarter of 2023 also went well for Krones," company CEO Christoph Klenk wrote in a letter to shareholders on Tuesday. He said the international beverage and food industry's willingness to invest remained very high. The subdued development of the global economy had hardly affected business. The share nevertheless fell significantly in early trading.

At just over 100 euros, they cost as little in early trading as they last did at the beginning of November. In the course of the day, the stock curbed its losses somewhat, falling 4 percent to 105.20 euros. Market participants' assessments of the quarterly figures were mixed. Some analysts complained that order intake had been below estimates, while for others it was higher than expected.

After the extraordinarily high order intake in the first quarter, customer orders in the second quarter "normalized" at a high level, as expected, the MDax company reported. Order intake in the three months to the end of June fell by 18 percent year-on-year to 1.27 billion euros. Sales, on the other hand, rose by 12.5 percent to 1.12 billion euros. Only recently, Krones had raised its annual forecast for profits.

Day-to-day business was also much better. Earnings before interest, taxes, depreciation and amortization (Ebitda) rose in the second quarter by 20.9 per cent to 106.5 million euros. According to the company, rising material costs were offset by price increases for its machinery and equipment. The bottom line saw profits rise 34.3 percent to 57.9 million euros.

Demand for the company's products and services remains high, Krones added. However, the business environment remains challenging. There were a number of imponderables that could affect the company's business processes and production. In addition to geopolitical risks, these included high inflation rates and interest rates. Material bottlenecks and problems in global supply chains also remained a factor of uncertainty. The situation on the relevant procurement markets, especially for electrical components, eased during the second half of the year.

In the second half of the year, Krones will increase the pace of production, continued company boss Klenk. The aim is to meet delivery deadlines accordingly, and to limit the further build-up in the order backlog. Better availability of electrical components and higher utilization of production capacities overall will also contribute to this, he added.

The company confirmed its targets for the year. For the full year, the Management Board expects sales to increase by 11 to 13 percent compared to the previous year. Operating profit (Ebitda) is expected to remain at 9 to 10 percent of sales. The return on capital employed is expected to improve to 15 to 17 percent./mne/jcf/jha/