Drägerwerk AG & Co. KGaA: Dräger significantly increases net sales and earnings in the first nine months of 2023

Dräger significantly increases net sales and earnings in the first nine months of 2023

• Order intake (net of currency effects) slightly above the high prior-year level
• Net sales increase by around 17 percent (net of currency effects) compared to the prior-year period
• Both divisions and all regions contribute to net sales growth
• Noticeable improvement in delivery capability
• EBIT well up at around EUR 77 million
• Annual forecast raised

Lübeck – Drägerwerk AG & Co. KGaA increased its net sales by 17.1 percent (net of currency effects) to EUR 2,320.9 million in the first nine months of 2023 (9 months 2022: EUR 2,027.0 million) and significantly improved its profitability: earnings before interest and taxes (EBIT) were clearly positive again at EUR 76.9 million (9 months 2022: EUR -148.3 million), while the EBIT margin rose by 10.6 percentage points to 3.3 percent (9 months 2022: -7.3 percent).

“During the first nine months of the current fiscal year, we significantly increased our net sales and earnings. We are thus well on track to return to growth and profitability in the full year 2023,” says Stefan Dräger, Chairman of the Executive Board of Drägerwerk Verwaltungs AG. “Our delivery capability has significantly improved. This enabled us to realize the potential net sales from our high order backlog, with which we started the fiscal year, more quickly. In addition, we benefited from exceptionally high demand for ventilators in China in early 2023. Overall, demand for our products and services remained high during the first nine months. Successful cost management also paid off and, in conjunction with good net sales growth, led to a very positive result.”

Net sales growth across both divisions and all regions
In the medical division, net sales in the first nine months of 2023 increased by 15.2 percent (net of currency effects) to EUR 1,359.2 million (9 months 2022: EUR 1,208.3 million). Growth was driven by all regions, but in particular by Europe as well as Africa, Asia, and Australia, where net sales in the first quarter increased very significantly, primarily due to the considerable increase in demand for ventilators in China at the beginning of the year.

In the safety division, net sales increased by 19.9 percent (net of currency effects) to EUR 961.7 million (9M 2022: EUR 818.7 million), driven by strong growth in all regions. Both divisions benefited from a noticeable improvement in supply capability and a positive order trend.

Significant improvement in profitability
Earnings development in the first nine months of 2023 was positively impacted in particular by the high net sales growth and improved gross margin. The latter increased to 44.0 percent (9 months 2022: 40.5 percent) as a result of higher production and service utilization and more effective price enforcement. Earnings after taxes also improved significantly to EUR 47.1 million (9 months 2022: EUR -112.7 million).

Order intake slightly above high prior-year figure
At EUR 2,403.3 million, order intake in the first nine months of 2023 was nominally 0.9 percent below the high prior-year figure (9 months 2022: EUR 2,424.2 million), but increased by 1.2 percent net of currency effects. This was due in particular to high growth in the Americas region. Demand also increased in the Europe region. The Africa, Asia, and Australia region recorded a decline.

In the medical division, order intake decreased by 1.7 percent (net of currency effects) to EUR 1,410.7 million (9 months 2022: EUR 1,462.1 million). This was due in particular to demand in the area of patient monitoring and for anesthesia devices, both of which declined again following the strong increase in the prior-year period. This decline contrasted with tangible growth in the service business.

In the safety division, order intake increased by 5.5 percent (net of currency effects) to EUR 992.7 million (9 months 2022: EUR 962.0 million). Growth was driven in particular by our gas detection devices and service business.

Business development in the third quarter
In the third quarter, Dräger's order intake increased by 6.8 percent (net of currency effects) to EUR 806.7 million (Q3 2022: EUR 776.6 million). The growth drivers were the Americas, with an increase of more than 30 percent (net of currency effects), as well as Africa, Asia, and Australia. In Europe, demand declined slightly. The medical business recorded an increase of 8.6 percent (net of currency effects) to EUR 493.1 million (Q3 2022: EUR 465.3 million). The safety business recorded growth of 4.0 percent (net of currency effects) to EUR 313.5 million (Q3 2022: EUR 311.3 million).

Dräger's net sales increased by 12.6 percent (net of currency effects) to EUR 788.5 million (Q3 2022: EUR 724.6 million). At 44.0 percent, the gross margin was also significantly above the prior-year figure (Q3 2022: 40.6 percent). EBIT improved to EUR 29.2 million (Q3 2022: EUR -36.6 million). EBIT margin was 3.7 percent (Q3 2022: -5.0 percent).

Full-year forecast raised
As already communicated in the ad hoc release on October 16, 2023, Dräger has raised its full-year guidance.

“Thanks to the positive business development during the third quarter, our expectations for the full year are now more optimistic than before: In terms of net sales growth, we are likely to reach the upper end of the forecast, and we also expect a higher EBIT margin,” says Stefan Dräger.

For net sales, Dräger expects a currency-adjusted increase of 7.0 to 11.0 percent (which corresponds to nominal growth of 4.5 to 8.5 percent based on current exchange rates). The forecast for EBIT margin has been raised from 0.0 to 3.0 percent to 2.0 to 4.0 percent.

Further information is available in the financial report at www.draeger.com.

Disclaimer
This press release contains statements on the future development of Dräger Group. These forward-looking statements are based on the current expectations, presumptions, and forecasts of the Executive Board as well as the information available to date. They were compiled to the best of the company’s knowledge. Dräger does not provide any warranty nor assume any responsibility for the future developments and results described above. These are dependent on a number of factors. They entail various risks and contingencies outside of the company’s influence and are based on assumptions which could prove to be incorrect. Dräger does not assume any responsibility for updating the forward-looking statements contained in this report. This does not infringe any legal stipulations on the adjustment of forecasts. Information on the financial indicators used (incl. alternative performance measures) can be found on our corporate website www.draeger.com in our Investor Relations section.