Rational AG increases its sales revenues by 10 percent to 1.126 billion euros – the outlook is optimistic

Rational AG increases its sales revenues by 10 percent to 1.126 billion euros – the outlook is optimistic

• Sales revenues grow by 10 percent in 2023 to 1.126 billion euros
• Strong sales revenue performance in North America and Asia
• EBlT margin rises to 24.6 percent
• Dividend of 13.50 euros proposed
• Forecast for 2024: continuation of the long-term growth trend expected with stable earning power

Landsberg am Lech, 27 March 2024     “2023 was a very significant year for us. We celebrated the 50th anniversary of our great company, repeatedly achieved record financial results, and presented innovations that will once again revolutionise the catering sector,” reports the clearly proud Rational CEO Dr Peter Stadelmann. The company with its headquarters in Landsberg am Lech presented its annual report for 2023 on the morning on 27 March 2024.

Sales revenues grow by more than 100 million euros to 1.126 billion euros
Rational had already reported strong figures for sales revenues and earnings in the first nine months of 2023. Contrary to expectations during the year, the fourth quarter of 2023 – spurred on by year-end business and an additional order from a chain customer in Asia – became the strongest quarter in the company’s history, with sales revenues of 292.8 million euros (2022: 290.4 million euros). As a result, sales revenues for 2023 increased overall by 103.5 million euros, which corresponds to a growth of 10 percent. “In addition to growth for iCombi cooking systems and after-sales business, we benefited primarily from positive effects of the price increases in 2022. However, this does not change our maxim to keep selling prices stable in the future,” says CFO Jörg Walter, referring to the growth.

From a regional perspective, North America confirmed its position as the biggest growth market. Business performance built on the successes of the previous years, and sales revenues increased by a further 18 percent. Growth in Asia was even higher at 24 percent. The positive development was mainly attributable to strong demand from China and Japan. Latin America grew by 18 percent thanks to good sales revenues in Brazil. Demand in the company’s home market, Germany, stabilised after the outstanding growth of the previous years and continued to be at a high level at minus 3 percent. Despite economic uncertainty, Europe (excluding Germany) exceeded the sales revenues of the previous year by 5 percent.

With an increase of 13 percent, sales revenues in the iCombi product group exceeded the billion mark for the first time. At 8 percent, the iVario was down compared to the previous year, which was driven by exceptional growth in the previous year (+57 percent).

Further improvement in the cost situation due to easing in the commodities market and international logistics
On the costs side, Rational is benefiting from easing in the commodities market and international logistics. The company achieved significant savings,  particularly in stainless steel, chemical, and energy costs after some extreme increase in the previous year. The cost of sales therefore rose more slowly than sales revenues, by 7percent to 487.2 million euros (2022: 457.3 million euros). The gross margin in fiscal year 2023 stood at 56.7 percent.

In fiscal year 2023, the Rational Group generated an EBIT (earnings before financial result and taxes) of 277.0 million euros (2022: 237.5 million euros), which corresponds to an EBIT margin of 24.6 percent (2022: 23.2 percent). EBIT benefited from the positive development of gross profit in combination with operating costs that also rose slightly more slowly than sales revenues. Operating costs in 2023 stood at 358.9 million euros (2022: 328,3 million euros). “We have thus come close to our medium and long-term EBIT target of around 25 percent sooner than expected after the corona shock,” says Dr Peter Stadelmann.

Dividend of 13.50 euros per share proposed
Due to the positive earnings performance, the Executive Board and Supervisory Board will propose to the General Meeting of Shareholders on 8 May 2024 the distribution of a dividend of 13.50 euros per share. That equates to a total distribution of 153.5 million euros. Even after the dividend distribution in May, there will still be sufficient liquidity in the company. “We repaid our last liabilities to banks in the past fiscal year. Together with the high level of liquidity, this provides us with the freedom at any time to make business decisions independently of banks and the capital market,” says CFO Jörg Walter, explaining the situation. That places the distribution ratio of 71 percent of consolidated net profit in line with the long-term average and the dividend yield at 1.9 percent based on the closing price on 31 December 2023.

Rational introduces new product category – presentation of the iHexagon
At the end of February, Markus Paschmann, Chief Sales & Marketing Officer at Rational, together with engineers and experts from the fields of research and development, and the project team, presented the iHexagon during an online keynote. “With the iHexagon, we are the first on the market to succeed in combining hot air, steam, and microwave heat in the cooking cabinet so intelligently that the energy is distributed evenly across all six racks,” as CSMO Markus Paschmann explains in the presentation. The company provides more information on the new product category on the website rational-online.com. “We have once again expanded our already great market potential with the iHexagon”, says Dr Peter Stadelmann, commenting on the third Rational revolution in the commercial kitchen after the combi-steamer in 1976 and the VarioCookingCenter in 2004.

 Number of employees worldwide tops 2,500 for the first time
“For Rational to remain successful, there is one thing we need more than anything else: qualified and motivated people who help us through their daily work to offer maximum benefit to our customers,” as Dr Peter Stadelmann explains. When taking on new hires, Rational places special emphasis on sales and sales-related functions. “We need to be close to our customers so that we know their needs,” says Jörg Walter. As of the balance sheet date (31 December 2023), the Rational Group employed 2,554 people, whom we refer to as “entrepreneurs in the company” (U.i.U.s). Of this total, 1,465 are employed in Germany.

MDAX membership
As of the General Meeting of Shareholders on 8 May 2024, Rational will once again meet all the index criteria in full and expects a decision on admission to the MDAX at the start of June 2024. The temporary absence from the MDAX came about in March 2024 due to the Chairman of the Audit Committee Dr Hans Maerz being a member of the Supervisory Board for just over twelve years. Hence, he is regarded as an independent Chairman of the Audit Committee according to the recommendations of the German Corporate Governance Code. This matter was duly published in the Declaration of Conformity at the end of January.

Forecast 2024
“In recent years, numerous special factors were reflected in our forecast. In many respects, 2023 was a year of normalisation for us, and we expect this trend to continue in 2024. We expect organic growth in line with our long-term growth rate with continued high profitability,” forecasts CFO Walter, stating that price increases were not planned. Accordingly, Rational expects growth in sales volumes and sales revenues in the mid to high single-digit percentage range compared with the previous year.

“The fact that commodity and logistics costs returned to normal works very much in our favour. It means that we can continue to invest in strategic projects, drive forward the expansion of our sales structure, and do so with an EBIT margin close to that of the previous year,” promises CEO Stadelmann.

Contact:

Rational Aktiengesellschaft

Stefan Arnold / Head of Investor Relations
Tel. +49 (0)8191 327-2209
Fax +49 (0)8191 327-72 2209

E-mail: ir@rational-online.com
rational-online.com

Editorial note:

The Rational Group is the global market and technology leader for thermal preparation of food in professional kitchens. The company, founded in 1973, employs more than 2,500 people, around 1,450 of whom are in Germany. Rational was floated in the Prime Standard of the German stock market in 2000.

The company’s principal objective is to offer maximum customer benefit at all times. Rational is committed to the principle of sustainability, which is expressed in its corporate policies on environmental protection, leadership, job security and social responsibility. Numerous international awards bear witness to the high quality of the work done by Rational’s employees year for year.