An upturn in the markets has helped Homag Group AG increase sales after two difficult years.
The manufacturer of machinery and equipment for the wood processing industry has seen sales rise by 16.2% to €138.8m during the first quarter, compared with [euror]119.5m last year.
Incoming orders have also risen by 18.8% to €161.1m, compared with €119.5m last year.
However, executive board spokesperson Klaus Bukenberger would like to see the income situation improve.
He said: “Competition is highly intense, with the result that there is considerable pressure on margins. Despite the slow reduction in overcapactiy, our competitors’ market behaviour has not yet normalised.
“High raw material prices and the continuing strength of the euro are further negative factors.”
The group has significantly reduced its costs over recent years through measures such as staff cuts – down to 5,033 in March 2004 compared to 5,477 the previous year.
Homag said the domestic market has recovered well with major western European markets remaining stable and eastern Europe and the CIS states still growing. There have been no signs of recovery in the North American market during the first quarter of 2004, but there is a clear recovery trend in Asian markets.
Mr Bukenberger hopes to see sales increase by about 5% over 2004 as a whole.
