Supply Chain Solutions segment
Business performance and level of orders
The value of the Supply Chain Solutions segment’s order intake fell sharply to €1,954.6 million in the period under review (Q1–Q3 2023: €2,227.7 million) due to weak demand in the project business (business solutions) during the second and third quarters of 2024. Whereas the level of orders in the customer segment encompassing pure e-commerce providers improved again compared with the subdued volumes in the previous two years, the other customer segments that make up the project business continued to be affected by market participants’ reluctance to invest. Encouragingly, the volume of orders in the high-margin service business (customer services), which consists of the modernization, expansion, and maintenance of existing customer installations, including the supply of spare parts, increased compared with the already high level of the prior-year period.
The value of the Supply Chain Solutions segment’s order book decreased from €2,920.6 million as at December 31, 2023 to €2,541.7 million as at September 30, 2024. The order book had already been reduced by €92.1 million in the first quarter of 2024 because of the cancelation of orders from the prior year.
in € million |
Q3 |
Q3 |
Change |
Q1 – Q3 |
Q1 – Q3 |
Change |
||||
|---|---|---|---|---|---|---|---|---|---|---|
Total revenue |
709.8 |
719.3 |
–1.3% |
2,161.1 |
2,216.3 |
–2.5% |
||||
EBITDA |
46.4 |
34.8 |
33.1% |
117.9 |
85.2 |
38.4% |
||||
Adjusted EBITDA |
48.4 |
35.8 |
35.2% |
128.7 |
91.4 |
40.9% |
||||
EBIT |
3.9 |
–7.1 |
> 100% |
–6.7 |
–41.8 |
83.9% |
||||
Adjusted EBIT |
28.4 |
15.8 |
79.6% |
70.5 |
30.7 |
> 100% |
||||
|
|
|
|
|
|
|
||||
Adjusted EBITDA margin |
6.8% |
5.0% |
– |
6.0% |
4.1% |
– |
||||
Adjusted EBIT margin |
4.0% |
2.2% |
– |
3.3% |
1.4% |
– |
||||
|
|
|
|
|
|
|
||||
Order intake1 |
636.1 |
892.2 |
–256.1 |
1,954.6 |
2,227.7 |
–273.1 |
||||
Order book1, 2 |
|
|
|
2,541.7 |
2,920.6 |
–378.9 |
||||
|
||||||||||
Revenue
The total revenue of the Supply Chain Solutions segment fell to €2,161.1 million in the first nine months of 2024 (Q1–Q3 2023: €2,216.3 million). This was because of the decline in the level of orders in the project business (business solutions) in preceding quarters. By contrast, the high-margin service business (customer services) registered strong revenue growth of 15.8 percent, which was mainly due to higher demand for modernization and expansion. The proportion of the segment’s external revenue accounted for by the service business increased to 41.5 percent as a result (Q1–Q3 2023: 34.9 percent).
Earnings
The Supply Chain Solutions segment’s adjusted EBIT rose sharply to €70.5 million in the first three quarters of 2024 (Q1–Q3 2023: €30.7 million). The gross margin and profitability increased in the reporting period despite the slight decline in revenue. Here, the segment benefited not only from the much higher earnings contribution from the service business but also from the efficiency measures carried out in project implementation and the significant progress that was made in working through lower-margin legacy orders. Its adjusted EBIT margin improved to 3.3 percent as a result (Q1–Q3 2023: 1.4 percent).
After taking into account non-recurring items and purchase price allocation effects, EBIT amounted to minus €6.7 million (Q1–Q3 2023: minus €41.8 million). The non-recurring items included costs (including interest and consultancy costs) of €14.7 million that were incurred in connection with the ending of a long-running legal dispute related to the acquisition of a group of companies in 2015 by the former Dematic Group.
Adjusted EBITDA improved to €128.7 million (Q1–Q3 2023: €91.4 million). The adjusted EBITDA margin was 6.0 percent (Q1–Q3 2023: 4.1 percent).