EQS-News: PIERER Mobility AG / Key word(s): Change in Forecast/Strategic
Company Decision
PIERER Mobility adjusts guidance and responds to tougher global conditions
14.06.2024 / 17:55 CET/CEST
The issuer is solely responsible for the content of this announcement.
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Corporate News
Wels, June 14, 2024
PIERER Mobility adjusts guidance and responds to tougher global conditions
• Sales fall short of expectations due to persistently high interest
rates in the USA and volatile market environment in Europe
• Comprehensive package of measures being implemented:
• Tighter cost management and reduction of production volumes in
Austria
• Expansion of the supply chain in India and China
• Realignment of the bicycle division
• Adjustment of guidance for the 2024 financial year
Sales fall short of expectations due to persistently high interest rates
in the USA and the volatile market environment in Europe
In the current financial year, momentum in PIERER Mobility’s core
motorbike markets in the USA and Europe has slowed significantly. Due to
the latest interest rate decisions in the USA, interest rates are expected
to remain high, which will have a negative impact on sales expectations
for the American market. Sales figures in Europe are also still volatile.
Overall, PIERER Mobility’s sales figures will fall short of expectations
this year after three years of above-average success.
This means that dealers will have to reduce their inventories and thus
continue to tie up considerable capital. The PIERER Mobility Group is
therefore continuing its efforts to strengthen its dealer structure
through extended payment terms and higher discounts. These measures have
already led to a sharp increase in working capital in the past financial
year. Management expects working capital and the associated capital
commitment to remain high in 2024. This is expected to have a significant
negative impact on EBIT and the financial result in the current financial
year.
Tighter cost management and reduction of production volumes in Austria
The production costs of motorbikes in Europe have risen due to high wage
settlements and increasing costs in connection with regulations and
bureaucracy, putting a strain on competitiveness. Production volumes are
therefore being significantly reduced at the production site in
Mattighofen. At the same time, the company is tightening cost management
throughout the Group.
With the growth in sales figures over the last ten years, the number of
employees at the motorbike subsidiary KTM AG has more than doubled. In
view of the changed location and market situation, the number of employees
has now had to be adjusted. This reduction in personnel after years of
rising employment is painful, but necessary in order to maintain and
secure the competitiveness of the production site.
Expansion of the supply chain in India and China
Another priority in 2024 is to increase efficiency in product development.
The focus will be on aligning and prioritizing activities in line with the
Group’s premium brand strategy and streamlining development processes.
Following on from this, joint research and development with the strategic
partner Bajaj Auto in India and the JV partner CFMOTO in China will be
expanded at the respective locations.
Due to the increasingly fragile supplier industry in Europe, the PIERER
Mobility Group is utilizing the favorable economic conditions in these
regions to secure its competitiveness. An efficient and high-quality
supplier industry is being established there.
Realignment of the bicycle division
During the coronavirus pandemic, demand for bicycles rose rapidly, leading
to overheating in the bicycle market and disruptions throughout the entire
supply chain. As a result, our own stocks and those of suppliers and
dealers reached record levels. The reduction of these inventories to a
normal level is continuing, while at the same time massive pressure is
being exerted on sales prices.
Due to the developments described above, the extraordinary impairment and
restructuring requirements in 2024 will lead to a significantly negative
result in the Bicycles segment.
The realignment of the Bicycles segment initiated in the 2023 financial
year with a focus on the premium segment will be systematically
implemented and completed in 2024.
Adjustment of the guidance for the 2024 financial year
For the 2024 financial year, the Executive Board expects a decline in
sales of 10% to 15% for both the motorcycles and bicycle divisions due to
the current market developments.
In the Motorcycles segment, the Executive Board assumes that the cost
savings introduced in the current financial year will be able to
compensate for the negative effects of declining sales to such an extent
that a balanced to slightly positive EBIT can be generated. The
development of existing dealers and the further expansion of the dealer
network to support the brand strategy will be key issues in 2024.
In the Bicycle division, however, the Executive Board anticipates a
significantly negative EBIT of €-110 to €-130 million for the 2024
financial year, which is essentially due to the above-mentioned
extraordinary impairment and restructuring requirements. The restructuring
of the Bicycle division is therefore complete.
About the Group
PIERER Mobility AG is the holding company of Europe’s leading manufacturer
of powered two-wheelers, producing a full range of premium brands
including KTM, GASGAS, Husqvarna and MV Agusta Motorcycles. With its
innovative strength, PIERER Mobility is a pioneering technology leader in
two-wheeled e-mobility through its motorcycle brands. In the bicycle
sector, the focus is on the premium segment. In the bicycle sector, the
focus is on the premium segment. The premium brand range also includes
high-performance components under the WP brand and special KTM X-BOW
high-performance sports cars.
Legal disclaimer
THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER OF SECURITIES FOR SALE OR A
SOLICITATION OF AN OFFER TO PURCHASE SECURITIES OF PIERER MOBILITY AG. IT
IS NOT FOR DISTRIBUTION, TRANSMISSION OR PUBLICATION, DIRECTLY OR
INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, AUSTRALIA,
CANADA, JAPAN OR SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH THE
DISTRIBUTION OF THIS ANNOUNCEMENT WOULD BE UNLAWFUL.
Contact:
Investor Relations
Melinda Busáné Bellér
Tel: +43 (0) 1 533 1 433 – 70
Email: ir@pierermobility.com
Website: (1) www.pierermobility.com
ISIN: AT0000KTMI02; Swiss Valor Number (Switzerland): 41860974; Ticker
Symbol: PKTM; Bloomberg: PKTM SW, PKTM AV; Reuters: PKTM.S; PKTM.VI
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14.06.2024 CET/CEST This Corporate News was distributed by EQS Group AG.
www.eqs.com
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Language: English
Company: PIERER Mobility AG
Edisonstrasse 1
4600 Wels
Austria
Phone: +43 (0) 7242 69 402
E-mail: ir@pierermobility.com
Internet: www.pierermobility.com
ISIN: AT0000KTMI02
WKN: A2JKHY
Listed: SIX, Vienna Stock Exchange
EQS News ID: 1925903
Valorennummer (Schweiz): 41860974 Wertpapierkürzel: PKTM Bloomberg: PKTM
SW; PKTM AV Reuters: PKTM.S; PKTM.VI
End of News EQS News Service
1925903 14.06.2024 CET/CEST
References