German woodworking machinery manufacturer Homag AG recorded a 13% growth in turnover for 2004, which it has hailed as evidence of a “revival” of investment activity in the industry.
The company’s newly-announced annual results show a turnover of €681m, up from €601m in 2003, while the value of orders received jumped 22% to €589m from €485m.
Homag, which also has a “satisfactory” €175m current order book, said the growth follows two difficult years of stagnating sales. It expects further market stabilisation in 2005, but with growth at a slower rate than 2004.
But Homag’s board is still not satisfied with its returns and blamed intensive international competition, high raw material prices and a strengthened euro for negatively impacting profit margins.
The company aims to head off these challenges by implementing optimisation and cost-cutting measures at its German facilities.
It will also further expand its sales and service companies and production facilities in Asia and eastern Europe. An extension to the Shanghai plant is due to be completed during the middle of this year, while the Polish factory will be expanded in 2005/06.
The German domestic market improved during 2004 following a sluggish performance in recent years. Italy, France, Spain and the UK remained buoyant and high growth was recorded in eastern Europe, particularly Poland and the CIS states.
Homag made good headway in North America despite the strong euro, while South America showed signs of recovery. The Chinese market resgistered strong growth, while the South-east Asian region was stagnant.
Homag will announce its 2004 profits figure at the Ligna machinery exhibition in May.
