MTU 2019 revenue? Good, absolutely good! Rolls-Royce Power Systems knew how to be stronger than adversity and closed 2019 with the are more. Underlying revenue increased by 4 percent to €4.04bn (here, a focus on service). So, the Friedrichshafen power and propulsion engines company became a 4 billion Euro company.
MTU 2019 revenue increased by 4%
«What stands out is that we have once again managed to strengthen the position of our MTU-brand products and solutions on a deteriorating market. That gives us a solid basis for further enhancing our profile as a provider of climate- and eco-friendly integrated drive and energy solutions. With them, we’re not only accelerating the energy turnaround, but consistently implementing our PS 2030 vision,» said Andreas Schell, CEO of Rolls-Royce Power Systems.
And now, after the declaration of the top management, we continue with the data of the press release: “The rise in the global energy demand highlights more than anything else the urgent need for eco- and climate-friendly power generation. In 2019, energy solutions became the strongest revenue segment for the first time, accounting for 35% of adjusted sales (up from 30% in 2018). Marine sales posted only a slight increase, causing their share of total revenue to drop to 28% (from 29% in 2018). The share of revenue of drives for agricultural and construction machinery and rail applications decreased from 31 to 25%, with customers in 2019 using the engine stocks built up in 2018 prior to arrival of new emissions legislations. Defence technology business and other products account for 12% of revenue. New products are being increasingly demanded by customers in the context of complete system packages. «That shows that we’re on the right track with our strategic transformation from engine-maker to complete solutions provider,» pointed out Schell. Revenue from service activities and products increased by 4% across all segments, contributing some 33% of total revenue in the business unit.
CFO Louise Öfverstöm
«All our financial figures point to a healthy business unit that has achieved profitable growth for three years in a row. With adjusted revenue passing the 4-billion-euro mark for the first time and the competitive edge we’ve gained, we can safely say that 2019 was a very good year for the business,» summed up CFO Louise Öfverström. The order book was €3.44bn at the end of 2019, just 5.6% below last year’s level. Among the drivers were major contracts sealed in the Far East, where Power Systems has entered into new markets.
In 2020, growth of the Power Systems business unit is expected to be on the moderate side. The faltering economic conditions that defined the second half of 2019 will continue to be felt in the first half of this year and may still deteriorate – largely due to the consequences of the Covid-19 disease. Economic recovery in the second half of the year is still a possibility, however. «But achieving the business outcomes we want in 2020 is going to be a big challenge,» concluded Öfverström. Several measures are being enacted by the company to counteract the effects of weaker demand – increased use of instruments to make working time more flexible, stringent cost control and efficient management of current assets.”