Despite all the tales of uncertainty and falling tractor sales, 9% down for January in Ireland, Krone remains bullish about the prospects for 2024.
In the latest report on its financial position, the company kicks off by noting that “revenue rose by 12.2% year-on-year to €4,720.7 million in 2023.”
This announcement was followed by the reassuring news that “in the fourth quarter of 2023, order intake increased by 6.8% on the previous year’s quarter to €1,263.0 million”.
“After the record in the previous year (€5,782.8 million), the contract value of orders remained at a high level in the full year 2023, at €5,376.6. As a result, the company’s order backlog increased by 18.9% to €4,122.3 million,” the results state.
There are several items of interest in this brief note. The first being that dealer confidence increased during the latter part of the year, which will be a consequence of a more optimistic mood among farmers.
The second is that the intended spending would appear to be on higher value equipment which not only increases the revenue stream, but orders take longer to fulfill as bigger machines have a longer build time.
This has pushed the lead time out well into 2024 ensuring that revenue from the first quarter will be on the healthy side.
Krone looks ahead
However, the question remains as to whether this will continue throughout the year? Krone is certainly expecting it to, forecasting that “for the full year 2024, the Executive Board forecasts revenue growth of 9% to 13%”.
Krone is heavily involved in grassland equipment so it is the stock sector that is expected to recover, a hope that will be buoyed up by recent signs of an increasing milk price.
Yet there is a note of caution being sounded as the report highlights geopolitical risks in Europe and the Middle East, as well as potential material shortages and supply chain issues arising from military action along important trade routes.
