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RATIONAL AKTIENGESELLSCHAFT

(RAA)
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Delayed Quote. Delayed Xetra - 05/14 11:35:24 am
768 EUR   +1.59%
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PRESS RELEASE : Rational AG: Encouraging business performance in March results in EBIT margin of 19% - another investment push in Wittenheim and U.S.

05/05/2021 | 01:02am EDT
DGAP-News: RATIONAL AG / Key word(s): Quarterly / Interim Statement 
Rational AG: Encouraging business performance in March results in EBIT margin of 19% - another investment push in 
Wittenheim and U.S. 
2021-05-05 / 07:00 
The issuer is solely responsible for the content of this announcement. 
=---------------------------------------------------------------------------------------------------------------------- 
Rational AG: Encouraging business performance in March results in EBIT margin of 19% - another investment push in 
Wittenheim and U.S. 
Business performance in the first quarter of 2021: 
- Sales revenues of 167.7 million euros, down 7% year on year 
- Improvement in EBIT and EBIT margin to 32.2 million euros and 19.2% (2020: 14.3%) respectively 
- Faster recovery possible than previously assumed 
- Investments of around 55 million euros expected for 2021 
Strong final month for sales revenues and new orders in the first three months 
After a business performance at RATIONAL AG as expected in January (sales revenues down 13% on the same month of the 
previous year) and February (down?22%), sales revenues for the first quarter as a whole benefited from a sharp rise in 
sales figures in March (up 14%). In March, there was also a positive trend in new orders, which were down 21% in 
January, 23% in February and up 39% in March (2020: down?32%) compared to the respective month of the previous year. 
"We see the growing number of customers no longer suffering or suffering less from coronavirus restrictions, the 
catch-up effect of investment, the in some instances massive stimulus packages and, as the base effect, the fact that 
March 2020 was the first month to be affected by coronavirus as reasons for this recovery in March", said Rational CEO 
Peter Stadelmann. In the first quarter of 2021, the company generated sales revenues totalling 167.7 million euros and 
was therefore around 7% (currency-adjusted 5%) below the figure for the prior-year quarter (2020: 181.3 million euros). 
Sales revenues in Asia grow by 27% compared to Q1 2020 - the other regions are still down year on year 
Progress in combating the pandemic varies worldwide. Accordingly, performance in the market regions in the first 
quarter of 2021 also varied greatly. Asia, which was the first region to be affected by coronavirus in 2020, is 
displaying a trend towards getting back to normal: quarterly sales revenues here are 27% above the prior-year quarter. 
This positive development benefited additionally from the good street- and strong partner business. North America, 
where daily life is also rapidly getting back to normal thanks to an effective vaccination strategy, is now only down 
by 7%. In Europe (excluding Germany), sales revenues are 16% lower than in the previous year, and 12% lower in Germany. 
Latin America continues to be heavily affected by the coronavirus crisis with a drop in sales revenues of 20% compared 
to the same period last year. 
iVario growth of 6% - iCombi 9% down year on year 
Sales revenues in the iVario product group in the first three months of 2021 were 6% up year on year at 17.8 million 
euros (2020: 16.9 million euros). The product group benefited in the first three months from last year's market launch 
in China and North America. Sales revenues in Japan also performed well thanks to strong partner business. 
Sales revenues in the iCombi product group in the first three months were 9% down year on year at 149.9 million euros 
(2020: 164.4 million euros). "The decline in sales revenues just for appliances was relatively low, which underscores 
the appeal of the new appliance generation. Due to the coronavirus-related restrictions on our customers' business 
activity, the drop in sales revenues from cleaning products and spare parts was somewhat steeper", adds Jörg Walter, 
CFO of Rational AG. 
Investment push in Wittenheim and U.S. 
In Wittenheim, the production site for iVario appliances, construction of a customer centre, an administration building 
and a production facility began in mid-April. The total investment volume here is around 25 million euros over the next 
24 months. 
In addition, RATIONAL is in the process of acquiring a plot of land in the greater Chicago area. In the first step, a 
customer centre, an administration building and a warehouse are to be erected on a generous plot and will replace the 
current leased properties from mid-2023. The plot should also offer the option of erecting a production facility in a 
later step. 
RATIONAL anticipates an investment volume of around 55 million euros for 2021 as a whole. 
56.0% gross margin in the first quarter of 2021 
The gross margin of 56.0% is at the prior-year level (2020: 56.0%). The past fiscal year was still dominated by the 
conversion of the production processes in Landsberg and Wittenheim due to the roll-out of the new product generations 
and dealing with the crisis-induced logistical constraints. Jörg Walter continues: "In the current year, we are 
benefiting in the production process from improved productivity. Adjusted for negative currency effects, the gross 
margin reached around 57%." 
The cost of sales was successfully adjusted to the new sales revenue level and at 73.8 million euros was around 8% 
below the prior-year level (2020: 79.8 million euros). Personnel costs in production, in particular, fell 
significantly, since RATIONAL managed to achieve considerable savings for auxiliary and temporary staff. 
EBIT margin up 4.9 percentage points to 19.2% 
EBIT (earnings before financial result and taxes) in the first three months of the current fiscal year was 32.2 million 
euros, up 24% on the prior-year quarter (2020: 26.0 million euros). The EBIT margin was 19.2% (2020: 14.3%). 
The EBIT margin for the previous year came under strong pressure due to the emerging coronavirus crisis, the resulting 
sudden slump in sales revenues in March and the related uncertainty at a still unchanged cost level. This year's EBIT 
margin for the first quarter benefited from the above-average drop in operating costs in relation to the decline in 
sales revenues. "The unexpectedly high sales revenues in March alone with a still comparatively low cost base were the 
main driver for the significantly better than expected EBIT margin", explains Peter Stadelmann. 
In total, the operating costs in the first quarter were successfully cut by 12% to 63.6 million euros (2020: 72.5 
million euros). The operating costs in sales and service in the first quarter stood at 42.5 million euros (2020: 50.3 
million euros) due to a reduction in expenses on trade fairs, travel, personnel costs, and transport and logistics 
costs of around 15% below the prior-year level. Major reductions in research and development expenses were only 
consciously made. They fell by 4% to 11.4 million euros (2020: 11.9 million euros). Administration expenses went down 
by 6% to 9.7 million euros (2020: 10.3 million euros). 
In the current year, the currency result of 1.5 million euros had a positive impact on the EBIT margin, while it fell 
sharply to -2.9 million euros in the prior-year quarter. Adjusted for all currency effects, the EBIT margin after three 
months was 19.4%. 
13.5 million euros in operating cash flow in the first quarter 
In the first three months of the current fiscal year, cash flow from operating activities was 13.5 million euros, while 
cash flow from operating activities in the prior-year quarter was around minus 22.3 million euros. This particular 
situation in the previous year was due primarily to low pre-tax earnings and a temporary build-up of inventories in 
connections with the converting to the new appliance generations. The improvement in the first quarter of 2021 is 
mainly due to the higher pre-tax earnings in conjunction with lower advance tax payments and a less extensive build-up 
of inventories. 
The cash flow from investing activities includes investments in property, plant and equipment and in intangible assets. 
In the first three months of the current fiscal year, these investments amounted to 4.0 million euros (2020: 7.5 
million euros). 
The cash flow from financing activities of -2.9 million euros mainly reflects the repayment of principal and interest 
in connection with bank loans (-0.8 million euros) and payments for lease liabilities in accordance with IFRS 16 (-2.1 
million euros). 
2020 dividend back to a payout ratio of around 70% 
A high level of liquidity and the resultant independence from capital markets and bank loans, preserving 
entrepreneurial freedom and a high payout ratio to the shareholders have always been vital for RATIONAL. To continue to 
maintain this independence and freedom, while returning to a payout ratio of around 70%, the Executive Board and 
Supervisory Board will propose a dividend of 4.80 euros per share for fiscal year 2020 to the General Meeting of 
Shareholders on 12 May 2021, which corresponds to a total distribution of 54.6 million euros. 
Slight decline in number of employees 
As in fiscal year 2020, RATIONAL also pursued a cautious personnel policy in the first three months of 2021. The 
RATIONAL Group had a total of 2,174 employees worldwide as at the end of March 2021, compared to 2,310 at the same time 
in the previous year. Around 1,200 people were employed in Germany as at the balance sheet date. 
Good first quarter provides slightly positive outlook for the year as a whole 
The company published the last forecast on 24 February 2021. The positive development in new orders and sales revenues 
in March was above the February expectations of RATIONAL and the entire commercial kitchen appliances industry. Since 
the market environment continues to be volatile, it remains, however, to be seen whether this positive development in 
new orders and sales revenues lasts or is a case of short-term catch-up effects. 
General factors indicating that the recovery among customers will continue are the rising vaccination successes, the 
spread of tests, the decline in positive cases in more and more regions and the milder summer temperatures. On the 

(MORE TO FOLLOW) Dow Jones Newswires

May 05, 2021 01:01 ET (05:01 GMT)

Stocks mentioned in the article
ChangeLast1st jan.
DJ INDUSTRIAL 1.06% 34382.13 Delayed Quote.11.16%
RATIONAL AKTIENGESELLSCHAFT 1.59% 768 Delayed Quote.0.85%
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Financials
Sales 2021 697 M 847 M 847 M
Net income 2021 95,4 M 116 M 116 M
Net cash 2021 263 M 320 M 320 M
P/E ratio 2021 88,4x
Yield 2021 0,80%
Capitalization 8 732 M 10 599 M 10 603 M
EV / Sales 2021 12,1x
EV / Sales 2022 10,7x
Nbr of Employees 2 180
Free-Float 41,9%
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Mean consensus SELL
Number of Analysts 10
Average target price 553,60 €
Last Close Price 768,00 €
Spread / Highest target -7,55%
Spread / Average Target -27,9%
Spread / Lowest Target -41,4%
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Managers and Directors
NameTitle
Peter Stadelmann Chief Executive Officer
Jörg Walter Chief Financial Officer
Walter Kurtz Chairman-Supervisory Board
Peter Wiedemann Chief Technical Officer
Erich Baumgärtner Independent Member-Supervisory Board
Sector and Competitors