KHD Humboldt Wedag International saw its 2010 revenue fall from €360m in the previous year to €287m due to the lower order intake during the 2009 economic crisis, however it booked a significant increase in new orders in 2010. Order Intake was up to € 308 million on the basis of pro forma figures (previous year: € 123 million). On December 31, 2010 order backlog was at a solid € 304 million.
The group restructured in March 2010 so that several of the Group’s legal entities were reported through 1Q under the former parent company. Therefore, the legal reporting in 2011 does not reflect the full performance of the Group. Group EBIT amounted to € 25.0 million on a legal reporting basis, or 8.7% of Group revenue (EBIT-margin). The consolidated net income for the year amounted to € 15.8 million.
The most important events included two extensive cooperation agreements. An exclusive long-term global sales agreement was concluded with Weir Minerals in May 2010, which will allow KHD to further expand its roller press technology and market presence in the minerals processing sector.
The strategic partnership with CATIC Beijing Co. Ltd., subsidiary of major Chinese state enterprise AVIC, was also a milestone for KHD. Group management launched the partnership in 2010 and it went into full effect in February 2011. CATIC demonstrated its commitment to the strategic partnership by acquiring 20% of KHD’s share capital as part of a capital increase. KHD and CATIC aim to become a market leader and are already jointly tendering on a number of cement projects, particularly for turn-key plants. The partnership will also help KHD gain entry in the important Chinese market – the world’s largest market for cement. KHD anticipates that this partnership will have a larger impact on revenue and earnings in 2012.
In September 2010 KHD signed an order of €85m for 2 x 10,000 kiln lines with Indian cement producer UltraTech Cement Ltd., who is one of the largest cement producers in the world and the largest in India. At the time of signing KHD was the only supplier in India with a reference plant for 10,000tpd of clinker in operation. KHD’s efficient COMFLEX® grinding technology for both clinker and raw material were also convincing factors in securing the deal.
Looking at the current 2011 financial year, the Management Board consequently expects order intake and revenues on 2010 levels. Due to the newly-founded business partnerships and the general economic outlook, KHD anticipates increased order intake and revenues for 2012. At the same time, the Management Board is of the opinion that continuing price pressure in the sector will have a greater impact on margins in 2011. For this reason, 2011 margin may be slightly lower than in 2010. However, improvement is expected in 2012.