RATIONAL AG: Sales revenues up 14 percent after 9 months of 2023

• North America remains the most important growth driver
• EBIT of 201.9 million euros – EBIT margin at 24.2 percent in the first nine months
• Three innovations strengthen technological lead
• 2023 forecast confirmed

Landsberg am Lech, 7 November 2023  “Rational is all about customer benefit. Therefore, I am particularly pleased to present three recent innovations during our 50^th anniversary year. Our continuous strive for development is an important reason for our economic strength. This is because, when the customer is satisfied, our success as a company is ensured,” reports Rational CEO Dr Peter Stadelmann with reference to the figures for the first 9 months of 2023, which have been published today.

Sales revenues up 14 percent after 9 months of 2023
At 272.3 million euros (2022: 274.2 million euros), sales revenues in the third quarter of 2023 were on a level with the prior-year quarter as well as with the first two quarters of the current fiscal year. As detailed in the company’s statement, the continued normalisation of orders on hand again had a positive impact. Total orders on hand stood at almost 130 million euros at the end of September.

In the first nine months of this year, the company’s sales revenues rose by 14 percent to 833.1 million euros (2022: 731.9 million euros). “Thanks to special factors from the reduction in orders on hand and price increases, year-on-year growth rates were particularly high, especially in the first six months of 2023. As expected, these effects diminished in the course of the year,” says CFO Jörg Walter. Adjusted for exchange rate movements, growth amounted to 16 percent compared with the previous year.

From a regional perspective, the sales revenues generated in overseas markets were particularly impressive. Driven by good business with small and medium-sized customers in the United States, sales revenues in North America went up by 30 percent in the first nine months of 2023. In the same period, the Latin America and Asia regions recorded growth of 24 and 22 percent respectively. While sales revenues in Germany were at the high level of the previous year, they rose by 7 percent in Europe (excluding Germany).

In the iCombi product group, sales revenues were up significantly, by 18 percent year-on-year, in the first nine months of 2023, at 745.8 million euros (2022: 634.0 million euros). The iVario product group generated sales revenues of 87.3 million euros (2022: 97.9 million euros). According to Rational, this decline was mainly due to the previous year’s high growth rates: in the first nine months of 2022, the company’s iVario sales revenues had climbed by 63 percent compared with the previous year.

56.5 percent gross margin after three quarters of 2023
Cost of sales increased more slowly than sales revenues in the first nine months, up 8 percent to 362.1 million euros (2022: 334.6 million euros). The gross margin improved in by 2.2 percentage points to 56.5 percent (2022: 54.3 percent). “This is attributable firstly to the positive effects of the previous year’s price increases and secondly to positive market and product mix effects. On the cost side, we benefited from the decrease in freight charges and material costs, particularly in chemicals and stainless steel. Moreover, increased productivity in our production had a positive impact on the gross margin,” explains Jörg Walter. The gross margin reached 57.4 percent in the third quarter, up 2.7 percentage points from the previous year (2022: 54.7 percent).

Due to the slower increase in both material usage costs and operating expenses in comparison to sales revenues during the first nine months of 2023, the company ended this period with an EBIT margin of 24.2 percent (2022: 22.3 percent). As at September 2023, EBIT (earnings before financial result and taxes) therefore amounted to 201.9 million euros, around 24 percent higher than the previous year (2022: 163.4 million euros). Adjusted for exchange rate effects, the EBIT margin for the first 9 months of 2023 exceeded 25 percent.

Number of employees worldwide tops 2,500 for the first time.
“In line with our financial strength and long-term outlook, we again invested in our employees, whom we refer to as “entrepreneurs in the company” (U.i.U.), in the third quarter of 2023. They once again demonstrated their full commitment in the service of our customers,” says Peter Stadelmann. At the end of September 2023, the Rational Group employed 2,524 U.i.U., including around 1,450 in Germany.

New products and services confirm power to innovate
At partner events and the international food and hospitality trade fair Host in Milan, Rational recently presented its three latest innovations, ranging from new software solutions through enhancements to an existing product down to a completely new product category. For more detailed information on the products and the launch of sales, please refer to the company’s publication of 13 October 2023.

Forecast confirmed
In the year 2023 to date, Rational has benefited from the positive special factors relating to the reduction of the high orders on hand. As at the end of the third quarter, orders on hand are expected to have largely returned to a normal level. At the same time, the order intake increased in the course of the quarter. For the fourth quarter of 2023, the company expects sales revenues to be slightly down on the level of the third quarter. For full-year 2023, Rational thereby confirms its forecast of growth in the high single-digit percentage range.

“On the costs side, we are still planning to raise certain operating expenses specifically, especially in sales. In addition, there will be investments in our international locations. Due to delays, however, the costs are currently below our original expectations. Furthermore, movements in the relevant foreign currencies – particularly the US dollar – were less impactful than expected at the half-year mark,” says the CFO with reference to the current situation. Overall, Rational expects the EBIT margin to be similar to that of the previous year. “If the effects referred to above resulting from project delays and favourable exchange rates continue, the EBIT margin could even be slightly higher than that of the previous year,” adds Walter.

Contact:
Rational Aktiengesellschaft
Stefan Arnold / Head of Investor Relations
Tel. +49 (0)8191 327-2209
Fax +49 (0)8191 327-72 2209

E-Mail: ir@rational-online.com
rational-online.com

Editorial note:
The Rational Group is the global market and technology leader for thermal preparation of food in professional kitchens. The company, founded in 1973, employs 2,500 people, around 1,450 of whom are in Germany. Rational was floated in the Prime Standard of the German stock market in 2000 and is currently represented in the MDAX.

The company’s principal objective is to offer maximum customer benefit at all times. Rational is committed to the principle of sustainability, which is expressed in its corporate policies on environmental protection, leadership, job security and social responsibility. Numerous international awards bear witness to the high quality of the work done by Rational’s employees year for year.