Rieter Achieves 22% Sales Growth And Unveils Ambitious Performance Programme
Rieter has announced impressive financial results for the first half of 2023, demonstrating a robust recovery despite challenging market conditions. The company recorded a significant sales increase of 22.2% to CHF 758.2 million compared to the same period last year.
The positive sales growth was accomplished despite the impact of the earthquake in Türkiye, which resulted in some cancellations and delivery delays. Rieter’s dedication to excellence and customer focus remained steadfast, contributing to a higher gross profit margin of 23.9% (first half of 2022: 21.0%).
The EBIT level showcased an exceptional performance, posting a profit of CHF 25.2 million for the first half of 2023, a remarkable turnaround from the loss of CHF -10.2 million during the corresponding period in the previous year.
Building on this success, Rieter has unveiled a transformative “Next Level” performance programme to strengthen sales excellence, enhance customer focus, improve production cost efficiency, and optimize fixed cost structures. The programme aims to foster agility and responsiveness to cyclical market fluctuations in the textile machinery business.
Under the programme, Rieter is expected to incur one-time restructuring costs of approximately CHF 45 to 50 million in the second half of 2023. The strategic initiatives will be implemented by the end of 2023, and the company anticipates achieving a net reduction of around 300 positions within overhead functions. Additional adjustments related to market and volume dynamics may impact 400 to 600 positions.
Rieter’s commitment to environmental sustainability is also reflected in the recent sale of non-operational land at Klosterstrasse in Winterthur, Switzerland, to Allreal Glattpark. The transaction, amounting to CHF 96.0 million, is expected to have a positive impact on the EBIT of approximately CHF 70 to 75 million.
Despite the ongoing cyclical market weakness, Rieter remains focused on providing value to its customers, employees and shareholders. The company expects below-average demand for new equipment in the coming months, with a possible revival projected for the fourth quarter of 2023.
Rieter’s leadership aims to achieve an EBIT margin of around 5 to 7% (including positive special effects of less than 2%) and maintain sales at approximately CHF 1.5 billion for the full year 2023.
With these innovative strategies and continued dedication to sustainable practices, Rieter is poised for a profitable and sustainable future in the textile machinery industry.
