Trumpf CEO Nicola Leibinger-Kammüller. [Image: Trumpf Group]
Trumpf Group, the Germany-based international supplier of high-tech machine tools and laser technology, ended its 100th-anniversary fiscal year on a high note. Total corporate revenues surged 27% year to year, from €4.2 billion (US$4.7 billion) in the year ended June 2022 to a record €5.4 billion (US$5.7 billion) in fiscal 2023. Operating earnings before interest and taxes (EBIT) ballooned by more than 31%, to €615.4 million in the June 2023 year. And Trumpf reported that its North American subsidiary, Trumpf Inc., took in more than a billion US dollars in sales “for the first time in company history.”
Somewhat less ebullient was the news on the firm’s order book. Order intake for fiscal 2023 softened 8.8% year to year, coming in at €5.1 billion versus the record €5.6 billion in orders logged in fiscal 2022. As a result, the company’s CEO, Nicola Leibinger-Kammüller, noted in a press conference announcing the results that she is “very cautious about the coming months.”
A “general upturn”
Leibinger-Kammüller attributed Trumpf’s strong sales growth to a “general upturn in demand” across the company’s product portfolio, and especially to a resolution of some supply-chain issues that had held back deliveries in fiscal 2022. This allowed Trumpf to work off the sizable backlog it had amassed.
Trumpf’s Machine Tools division contributed biggest chunk of fiscal 2023 revenues, at €3.0 billion, a nice 32.8% advance from prior-year levels. Laser Technology, the second-biggest contributor, saw a 28% sales gain, to €2.1 billion.
The numbers for Laser Technology included a spectacular 58% increase for the firm’s electronics business, where revenues surged from €344 million in fiscal 2022 to €546 million in fiscal 2023. Sales of equipment for EUV lithography, an important recent source of strength for Trumpf, also continued their increase, expanding another 22.2% in fiscal 2023, to €971 million, after a blistering performance in fiscal 2022.
Cover of Trumpf’s 100th-anniversary annual report. [Image: Trumpf Group]
Trumpf apparently did well wringing operating profits out of those revenue gains. The company reported that its operating EBIT margin expanded from 11.1% in fiscal 2022 to 11.5% in fiscal 2023, “despite increased raw material, logistics and personnel costs.”
US market ascendant
Regionally, the United States market remained at the top, kicking in €899 million in fiscal 2023 revenues, a 37% year-to-year increase. For several years now, US revenues have outstripped those from Trumpf’s traditionally strongest market, Germany, which contributed €779 million in fiscal 2023 sales—still a nice 32% bounce from fiscal 2022 levels.
The strong US revenues, coupled with smaller contributions from Mexico and Canada, pushed sales of the firm’s North American subsidiary, Trumpf Inc., to US$1.05 billion in the year ended 30 June. The US arm’s president and CEO, Lutz Labisch, linked the strong showing to “a robust economy, the ongoing trend of reshoring manufacturing to North America, and high investments into strategic technologies such as e-mobility and semiconductors,” and noted a number of expansion plans for the company in the US market next year. Trumpf also touted its investment in research and development, pointing to both an 8.8% increase in total R&D staff and a 6.3% increase in R&D spending in the past year.
A few choppy months ahead?
Notwithstanding that long-term investment, CEO Leibinger-Kammüller tried to temper expectations for the next few quarters. “Since spring … we have felt a decline in demand in many markets,” she said in a press release accompanying the earnings announcement. “In view of the difficult overall economic development, I am therefore very cautious about the coming months.”