Oerlikon Group Faces Headwinds In Sales & Margins For Q3 2023
Oerlikon Group recently released its Q3 2023 financial results, revealing headwinds in sales and margins due to challenging market conditions.
During the third quarter, Oerlikon Group experienced a 25.8% drop in order intake to CHF 567 million, mainly attributed to a slump in demand in the polymer processing solutions segment. Sales also declined by 15.9% to CHF 623 million. Adjusting for currency fluctuations, the sales decline was 10.9%.
Oerlikon reported an operational EBITDA of CHF 98 million for Q3 2023, reflecting a 23.3% decrease compared to the same period in 2022. The operational EBITDA margin for the quarter was 15.7%. In Q3, operational EBIT was CHF 44 million, making up 7.1% of sales.
Michael Suess, Executive Chairman of Oerlikon, noted that the company is actively reviewing operational and strategic actions to enhance its resilience in the light of challenging market conditions. Suess emphasized that Oerlikon’s fundamentals remain strong, despite the cyclical weakness in the polymer processing solutions segment. The company remains committed to its long-term growth strategy, underpinned by an innovative pipeline.
Segment Performance
Surface Solutions Division: This segment reported a Q3 order intake increase of 6.2% to CHF 367 million. Sales also saw growth of 6.3% to CHF 368 million, with adjusted sales showing an 11.9% increase. The division’s operational EBITDA margin remained stable at around 17%.
Polymer Processing Solutions Division: This division faced significant challenges, experiencing a Q3 order intake decline of 52.3% to CHF 199 million. Sales for the quarter decreased by 35.5%. Oerlikon continues to focus on executing cost actions, with positive impacts expected in Q4.
Despite the short-term challenges, Oerlikon remains confident about its long-term growth potential. The company’s innovation pipeline is filled with solutions designed to increase customer value. Oerlikon continues to monitor its strategies and market conditions, with the conviction that the long-term demand drivers for both its businesses remain intact.
