The Homag Group continues to feel the effects of the customers’ reluctance to invest. Sales and earnings decreased in the first half of 2024. The job cuts in Germany announced at the end of 2023 could be achieved entirely on a voluntary basis without operational layoffs.
“As expected, the first half of 2024 has not yet brought a recovery in our industry,” emphasizes CEO Dr. Daniel Schmitt. “The weak demand from the furniture and wood construction industries has persisted and is reflected above all in the low level of single machine business.”
In the first six months of 2024, the Homag Group’s order intake increased only slightly by 4% to Euro 699 million compared to the low figure of the previous year (previous year: Euro 671 million), with the Q2 2024 being particularly subdued. The order backlog decreased to Euro 833 million as of June 30, 2024.
The persistent market weakness since the second half of 2022 is also reflected in sales, which fell by 14% to Euro 706 million in the first half of 2024 (previous year: Euro 817 million). In contrast, sales in the service business developed positively. In this area, various initiatives led to an increase of around 4%. EBIT before extraordinary effects decreased to Euro 21.5 million (previous year: Euro 56.8 million).
“As a result of this pronounced and prolonged market weakness, we initiated a package of measures in November 2023 to adjust capacity and increase efficiency,” explains Dr. Schmitt. “Our earnings performance this year shows how important it is to implement these measures in order to secure the future of the Homag Group and maintain our competitiveness in the long term. A key element of the program was the reduction of approximately 600 jobs worldwide, of which around 350 were in Germany. Here, we were able to achieve the goal through natural fluctuation and a hiring freeze as well as a volunteer program. We have thus avoided layoffs for operational reasons.”
In the current year, the capacity reduction is expected to cut fixed costs by Euro 25 million; from 2025, the Homag Group expects to realize the full savings effect of Euro 50 million.
The Homag Group is the world's leading provider of integrated solutions for production in the woodworking industry and woodworking shops.
