Global Economic Snapshot and Forklift Industry Summary
The first quarter of 2017 was marked with soaring stock markets, global political turbulence, and in the case of the forklift industry: continued growth. Since this time last year, 57 thousand new trucks have been sold, marking a 19.4% increase globally.
The Asia-Pacific market has led the surge thus far with 34.8 thousand new truck orders, which equates to an increase of 32.5% since Q4 of last year. Through the first quarter, China has been the main contributor to this region’s growth.
The EMEA region (western Europe, eastern Europe, Middle East and Africa) also generated substantial growth this quarter at 14.2%. Eastern Europe was the leader in this regard, growing their orders by a staggering 42%. Russia has been the primary influence behind this region’s impressive growth, displaying particularly high demand so far this year. Does this mean we may be facing an impending forklift cold war? Unlikely, despite current political tensions..
The Americas were also able to sustain growth at a rate of 7.6%, however the bulk of these sales still resided primarily in the U.S. Worth noting however is Brazil’s recovery from a poorly performing market the past few years.
Globally, internal combustion forklifts saw a 22.8% increase in sales in the first quarter, while electrics rose 15.1%. Both are significant figures in comparison to this time last year, where IC’s were declining at 4.3% and electrics were growing at 7.3%. A large majority of the recent demand for IC’s has come from China. Look out Russia, it appears China is trying to flex some forklift muscle as well.
Overall, the global outlook for forklifts is showing a strong positive trend in the first months of 2017, particularly on the Eurasian continent. It will be interesting to see which countries will sustain their demand throughout the rest of the year.
Quarterly Report Summaries
KION Group’s revenue has increased by 48.4% (591 million euros) the past 12 months, and 4.1% this quarter. Since Q1 of last year, net income has also seen impressive growth at 27.2% (9 million euros).
KION’s “Supply Chain Solutions” segment now contributes to 26.6% of company revenue, compared to last year’s 1.6%. This increase represents 81.6% of the total increase in revenue the past 12 months. (482.2 mil/591 mil). It appears they are beginning to reap the rewards of their Dematic Inc. acquisition last November.
Conversely, their “Industrial Trucks and Services” order intake and revenue are down 3% and 8% respectively. This may indicate a shift in business priorities, or sales may have simply been distracted by having a new baby at home for the past few months (Dematic).
Either way, KION Group is finding ways to create growth moving forward.
Since the first quarter of last year, orders are up 13.7% (2.8 thousand units). Revenue has also shown impressive growth at 18% this past year ($108.9 million), but only 3.2% from last quarter.
Looking at the global picture, revenue from the Americas rose 7.9% in Q1. However during the same period, EMEA (European) and JAPIC (Pacific) operations are down 6.2% and 1.6% respectively.
The Nuvera acquisition also continues its struggle to become profitable. Nuvera’s revenue has grown from $0.3 million to $2.6 million since last year, however operating losses also grew from $6.1 to $9.5 million due to rising expenses.
Regardless, Hyster-Yale believes that demand for Nuvera solutions will begin gaining momentum beginning in 2017/2018, due to increasing recognition of the benefits of fuel cell power.
So far, Jungheinrich has produced some very impressive figures compared to this time last year. Firstly, orders have increased 12.7%, from 27.5 thousand to 31 thousand units. Secondly, net sales also saw significant growth at 18.6% (667 million to 791 million euros). However, most impressive was their bottom line, with net income growing from 28.3 to 38 million (34%).
New truck sales accounted for most of this growth with a 29.1% increase from last year. Jungheinrich’s “Intralogistics” segment held the second largest growth rate within the company at 20.1%, and is the largest contributor to net sales by volume.
Judging by these numbers, Jungheinrich is off to a very strong start to 2017.
Toyota Material Handling
Toyota’s Material Handling’s net sales has decreased 12 billion yen from last quarter (-5%). Not to mention, Toyota recorded declining net sales in Material Handling in its previous annual report as well (-3%). Toyota cites exchange rate fluctuations to be the causal factor.
However in February and March of this year, Toyota took a leap forward by acquiring Bastian Solutions and Vanderlande Industries. Bastian being a major North American materials handling firm, and Vanderlande being the global market leader for logistic process automation. Both of these acquisitions position Toyota for new growth in North America moving into the remainder of 2017.
Ritchie Bros Auctioneers’ revenue decreased from $131.9 million to $124.5 million since Q1 of last year (5.6%). In addition, net income fell in dramatic fashion from $30 million to $10.4 million (65%).
United Rentals’ revenue grew by 4.4%, from $1117 million to $1166 million over the past 12 months. Meanwhile, net income also increased by 18.5%, from $109 million to $92 million.