EQS-News: DEUTZ holds its own in a difficult environment

• Adjusted guidance fully achieved, adjusted EBIT comfortably in positive territory despite weak economy, slight increase in new orders

• Portfolio development and efficiency measures are increasingly paying off

Cologne, March 20, 2025 – DEUTZ felt the effects of the persistent, cyclical weakness in demand in 2024, but nevertheless ended the year successfully following a stable fourth quarter. This is shown by the results published today, according to which DEUTZ has met the guidance, as adjusted in October 2024. With revenue down by 12.1% to €1,813.7 million, the Company achieved adjusted earnings (EBIT before exceptional items) of €76.7 million. This corresponds to an adjusted EBIT margin of 4.2%, which is a level of margin that DEUTZ had previously achieved only when production was running at significantly higher capacity utilization. At €1,827.1 million, new orders were 4.4% higher than in the previous year, mainly due to the successful development of the portfolio. In 2024, DEUTZ acquired the US genset manufacturer Blue Star Power Systems and took over the off-highway business for selected Daimler Truck engines from Rolls-Royce Power System. In addition, the sale of the loss-making subsidiary Torqeedo, which was completed in spring 2024, relieved a considerable amount of pressure on the Group's results.
"The economic environment took a considerable toll on us over the past financial year, as demonstrated by a look at practically all of our sales markets. The good news is that we are making money even in these difficult times," explains DEUTZ CEO Dr. Sebastian C. Schulte. "Our strategy of putting DEUTZ on a progressively broader and more resilient footing is already paying off. We will therefore position ourselves even more strongly as a solution provider along the value chains we are familiar with. At the same time, we see considerable potential for further profitable expansion of our business with traditional internal combustion engines and our service business."
The core of the Dual+ strategy, which was further developed in 2024, is a greater diversification of the portfolio. By entering the market for decentralized energy supply, adopting a demand-driven position in the field of alternative drive systems and expanding its global service business, DEUTZ has already reached some important milestones. As the Company continues to implementof the strategy, it aims to increase revenue to around €4 billion by 2030.
DEUTZ also began implementing an efficiency program over the past financial year with the aim of strengthening its profitability. The program is intended to achieve a reduction of 300 jobs with minimum social impact and to reduce operating costs, thus going beyond the measures taken at short notice in 2024. The aim is to reduce costs on a sustainable basis by the end of 2026.
"The cost-cutting measures that we introduced at short notice led to savings of just over €15 million last year. Our task now is to expand the measures already taken and to consolidate them. And this is precisely the objective of our Future Fit program, under which we intend to achieve a lasting reduction in our cost base of €50 million per year," explains DEUTZ CFO Oliver Neu, who is overseeing the program in cooperation with an interdisciplinary team.
Dividend proposal for the 2024 financial year
To enable shareholders to benefit from the earnings growth, the Board of Management and the Supervisory Board will propose to the Annual General Meeting on May 8, 2025 that a dividend of €0.17 per share (2023: €0.17) be paid from accumulated income for the 2024 financial year, meaning that DEUTZ would have maintained a constant dividend for at least four years. This would equate to a dividend ratio[1] of just over 40%.
Detailed figures for 2024[2]
At €1,827.1 million, the DEUTZ Group's new orders in the 2024 financial year were 4.4% higher than in the previous year (2023: €1,749.9 million). This increase is mainly because the cyclical decline in demand in the preceding quarters was more than offset by positive consolidation effects.
Orders on hand totaled €463.9 million at the end of 2024 and were thus slightly up on the previous year's figure by €13.5 million (2023: €450.4 million), partly due to the acquisition of Blue Star Power Systems and the acquisition of Rolls-Royce Power Systems' off-highway business relating to selected Daimler Truck engines.

With new orders in decline since the end of 2023 due to the economic downturn, DEUTZ recorded a significant year-on-year decline in unit sales of 23.9% to 142,084 engines sold in the Classic segment (2023: 186,718).
As a result of the decline in unit sales, revenue fell by 12.1% to €1,813.7 million in the same period (2023: €2,063.2 million). The significantly smaller decline in revenue compared with unit sales is mainly due to the fact that the acquisition of Blue Star Power Systems and the aforementioned takeover of Rolls-Royce Power Systems' business activities led to a higher price per unit sold, and the expansion of the service business is not reflected in unit sales.
The revenue contribution of genset manufacturer Blue Star Power Systems, which has been consolidated since August 2024, amounted to just over €60 million in 2024 and has thus more than met expectations so far. DEUTZ had forecast revenue of more than US$ 100 million per year when the acquisition was announced.[3] The revenue contribution of the former Rolls-Royce Power Systems activities, which have also been consolidated since August and comprise various Daimler Truck industrial engines, amounted to around €80 million.
Adjusted EBIT (EBIT before exceptional items) amounted to €76.7 million in the reporting period (2023: €143.6 million). This decrease is mainly due to the decline in revenues as a result of the weak economic environment and a lower production volume in the Classic segments resulting in diseconomies of scale in production. In contrast, acquisitions particular had a particularly positive effect on earnings. In addition, measures to reduce costs and increase efficiency, as well as lower research and development costs, further mitigated the volume-related impact on earnings. The adjusted EBIT margin was 4.2% (2023: 7.0%).
Net income fell to €42.0 million in the 2024 financial year (2023: €106.9 million), reducing earnings per share to €0.32 (2023: €0.86). Earnings for the entire Group[4] amounted to €51.8 million in 2024 (2023: €81.9 million). The corresponding earnings per share were thus €0.39 (2023: €0.66). Earnings per share before exceptional items amounted to €0.55 (2023: €0.82).

Cash flow from operating activities amounted to €110.4 million in the 2024 financial year (2023: €151.5 million). The year-on-year decline is due in particular to lower earnings as a result of the decline in revenue.  At €247.0 million, net cash used for investing activities was significantly higher than in the previous year (2023: €96.0 million). As a result of the continued implementation of strategically important growth projects, payments for acquisitions increased by €151.0 million year on year and had a negative impact on cash flow of €183.1 million. Excluding M&A activities, net cash used for investing activities amounted to €63.9 million (2023: €64.9 million).  Due to the increase in net cash used for investing activities, free cash flow decreased year-on-year to minus €153.1 million (2023: plus €41.8 million). Free cash flow before M&A was €30.0 million (2023: €72.9 million) as a result of the decline in cash flow from operating activities.

Due to the increase in cash flow from investing activities, free cash flow decreased year-on-year to €153.1 million (2023: €41.8 million). Free cash flow before M&A was €30.0 million (2023: €72.9 million) as a result of the decline in cash flow from operating activities.
The equity ratio was 50.4% as at December 31, 2024 (December 31, 2023: 46.7%).[5] In addition to the net income for the period, this increase was also due to the capital increase of around €71 million in the period under review.
Guidance for 2025
Assuming a tangible market recovery in the second half of 2025, but before assessing the announced increase in US import tariffs, DEUTZ expects revenue of between €2.1 billion and €2.3 billion for the 2025 financial year, accompanied by an EBIT margin before exceptional items (adjusted EBIT margin) of between 5.0% and 6.0%.[6] Free cash flow before M&A expenditure is expected to be in the mid-double-digit millions of euros.

 

DEUTZ Group: Overview (continuing activities)[7]
€ million
		2024		2023		Change		Q4 2024		Q4 2023		Change
New orders		1.827,1		1.749,9		4,4 %		480,9		351,0		37,0%
Unit sales (units)		142.907		187.116		-23,6 %		35.557		49.557		-28,3 %
Revenue		1.813,7		2.063,2		-12,1 %		507,8		556,0		-8,7 %
Adjusted EBIT (before exceptional items)		76,7		143,6		-46,6 %		19,4		37,0		-47,6 %
EBIT margin (before exceptional items)		4,2 %		7,0 %		-2,8 PP		3,8 %		6,7 %		-2,9 PP
Exceptional items		-34,8		-20,1		-73,1 %		-17,5		-19,4		9,8%
EBIT		41,9		123,5		-66,1 %		1,9		17,6		-89,2%
Free cash flow (before M&A)		30,0		72,9		-58,8 %		58,6		63,5		-7,7 %
Net financial position (as at Dec. 31)[8]		-225,6		-163,4		-38,1 %
Capital expenditure (after deducting grants)[9]		100,2		114,5		-12,5 %		-124,7		9,2		–
R&D ratio[10]		5,1 %		4,7 %		+0,4 PP
R&D expenditure (after deducting grants)		93,4		97,9		-4,6 %		23,3		31,1		-25,1 %
Employees (as at Dec. 31)[11]		5.228		5.084		2,8 %
DEUTZ Group: Overview (entire Group)
€ million
		2024		2023		Change		Q4 2024		Q4 2023		Change
Revenue		1.821,3		2.104,8		-13,5 %		507,8		564,8		-10,1 %
Adjusted EBIT (before exceptional items)		76,7		120,4		-36,3 %		19,4		27,7		-30,0 %
EBIT margin (before exceptional items)		4,2 %		5,7 %		-1,5 PP		3,8 %		4,9 %		-1,1 PP
Exceptional items		-25,5		-20,1		-26,9 %		-17,9		-19,4		7,7%
EBIT		51,2		100,3		-49,0 %		1,5		8,3		-81,9%
Net income		51,8		81,9		-36,8 %		18,0		16,0		12,5 %
Earnings per share (before exceptional items, €)		0,55		0,82		-32,9 %
Earnings per share (€)		0,39		0,66		-40,9 %
Equity (as at Dec. 31)		847,9		743,2		14,1 %
Equity ratio		50,4 %		46,7 %		+3,7 PP
Free cash flow (before M&A)		20,8		57,8		64,0 %		58,2		61,0		-4,6 %
R&D ratio[12]		5,1 %		4,9 %		+0,2 PP		5,1 %		4,9 %		+0,2 PP
Employees (as at Dec. 31)[13]		5.228		5.284		-1,1 %

 

DEUTZ Classic: Overview (continuing activities)[14]
€ million
		2024		2023		Change		Q4 2024		Q4 2023		Change
New orders		1.819,6		1.743,2		4,4 %		479,5		350,6		36,8 %
Unit sales (units)		142.084		186.718		-23,9 %		35.255		49.187		-28,3 %
Revenue		1.806,0		2.058,2		-12,3 %		505,3		554,2		-8,8 %
Adjusted EBIT (before exceptional items)		113,1		180,1		-37,2 %		30,7		48,1		-36,2 %
EBIT margin (before exceptional items)		6,3 %		8,8 %		-2,5 PP		6,1 %		8,7 %		-2,6 PP
DEUTZ Green: Overview (continuing activities)[15]
€ million
		2024		2023		Change		Q4 2024		Q4 2023		Change
New orders		7,5		6,7		11,9 %		1,4		0,4		250,0 %
Unit sales (units)		823		398		106,8 %		302		370		-18,4 %
Revenue		7,7		5,0		54,0 %		2,5		1,8		38,9 %
Adjusted EBIT (before exceptional items)		-35,3		-37,1		4,9 %		-9,8		-11,5		14,8 %
EBIT margin (before exceptional items)		-458,4 %		-800,0 %		+283,6 PP		-392,0 %		-638,9 %		+246,9 PP

The annual report 2024 is available at www.deutz.com/en/investor-relations.
To commemorate the 125th anniversary of its initial stock market listing, DEUTZ AG and its Board of Management will be guests at Deutsche Börse's morning bell-ringing ceremony on March 20, 2025. From 11.30 a.m., pictures of the ceremony and quotes from our Board members will be available under the following link: https://www.deutz.com/en/news/media-center/125-years-stock-market

Upcoming financial dates:
April 30, 2025: Quarterly statement for the first quarter of 2025
May 8, 2025: Annual General Meeting (virtual)
August 7, 2025: Interim report for the first half of 2025
For further information on this press release, please contact:
DEUTZ AG | Mark C. Schneider | Head of Investor Relations, Communications & Marketing
Tel. +49 (0) 221 822-3600 | Mark.Schneider@deutz.com
DEUTZ AG | Svenja A. Deißler | Senior Manager Investor Relations & ESG
Tel. +49 (0) 221 822-2491 | Svenja.Deissler@deutz.com