PRESS RELEASE : Vossloh Aktiengesellschaft: Capital Markets Day: Vossloh presents corporate strategy and considers itself ideally positioned for the future

 
 DGAP-News: Vossloh Aktiengesellschaft / Key word(s): Miscellaneous 
Vossloh Aktiengesellschaft: Capital Markets Day: Vossloh presents corporate 
strategy and considers itself ideally positioned for the future 
 
2020-12-15 / 16:47 
The issuer is solely responsible for the content of this announcement. 
 
*Capital Markets Day: Vossloh presents corporate strategy and considers 
itself ideally positioned for the future* 
 
· Railways attracting increased attention worldwide as the most 
environmentally friendly mode of transport 
 
· Increased levels of rail traffic will have a significant positive 
influence on Vossloh's business in the medium and long term 
 
· Continuous monitoring of the condition of rail infrastructure with 
sensors enables a significant increase in the efficiency of track 
maintenance 
 
· Strategic orientation based on combining the existing core business with 
innovative digital business models 
 
· Preliminary outlook for 2021 with significantly improved operational 
profitability 
 
· Medium and long-term financial ambitions anticipate above-average growth 
and further increase in profitability 
 
*Werdohl, December 15, 2020.* At today's virtual Capital Markets Day, the 
Executive Board of Vossloh AG presented the company's most recently adopted 
corporate strategy. The Executive Board also presented and discussed its 
preliminary forecast for the coming 2021 fiscal year as well as its medium 
and long-term financial ambitions. 
 
*Greater levels of rail traffic* 
Megatrends such as population growth, urbanization, the globalization of 
trade flows, digitalization and the increasingly important topic of 
sustainability make it essential to markedly accelerate the shift of 
passenger and freight transport from roads to rails. Expansion of existing 
rail networks in proportion to the increasing level of traffic is not 
possible in practical terms. Therefore, it will become a matter of key 
importance to increase the availability of rail infrastructure, and tracks 
in particular. Modern train control systems such as ETCS and the increasing 
shift to digital interlockings will facilitate increased traffic density on 
rail lines in the medium term. This additional rail traffic will inevitably 
lead to increased wear, and thus to greater demand for rail infrastructure 
components. Vossloh currently generates roughly 90 percent of its Group 
sales with such components. As the level of rail line utilization increases, 
the amount of time available for maintenance measures decreases. This means 
that maintenance models need to become much more efficient, ideally 
identifying and remedying defects before they lead to serious problems. 
Increased network capacity utilization results in increased economic damage 
due to the unavailability of rail line sections. Furthermore, fast 
preventive maintenance technologies will become even more important in the 
future. Vossloh's patented high-speed grinding, for example, makes it 
possible to perform maintenance work almost entirely without rail line 
disruption and reduces the likelihood of severe rail defects when used on a 
regular basis. 
 
*Three strategic pillars* 
The strategy presented can be roughly divided into three subsections. 
Firstly, the existing business with products and conventional services 
relating to rail infrastructure will be expanded and further strengthened 
with a view to their profitability. The related package of measures includes 
the sustainable reduction of production costs, increased sales focus on 
growth regions, and expansion of the offering portfolio with complementary 
products and services as well as an entire series of selective innovations. 
 
At the same time, in the future Vossloh will increasingly target its 
customers' steadily growing need for more track availability in light of the 
anticipated growth in traffic. The collection of condition data, both 
directly on the track and through Vossloh's own fleet of track maintenance 
machines, and the derivation of condition-based, predictive maintenance 
programs through artificial intelligence, provide customers with great 
efficiency potential. 
 
Among other things, the new strategy focuses on accelerating the development 
of digital expertise, including through relevant partnerships, and 
emphasizes the importance of sustainable management more strongly than 
before. At the same time, a Group-wide system for continuously increasing 
efficiency in all areas of the company has been designed and implemented. 
 
*Differentiation by a systemic understanding of the rail track* 
After successfully completing the process of focusing the company on the 
core business of rail infrastructure in May of this year, Vossloh today 
distinguishes itself from its competitors mainly through its uniquely 
comprehensive range of track-related products and services. Vossloh 
understands the physics of all significant track components as well as their 
systemic interaction. This comprehensive understanding of rail track serves 
as the foundation for the derivation of relevant maintenance recommendations 
for customers from the data collected. 
 
"Realistically, climate protection targets cannot be achieved without 
shifting greater levels of traffic from roads onto rail networks. Therefore, 
in light of the diverse and obvious limitations on the expansion of rail 
networks, the focus should be on significantly increasing the availability 
of existing networks," explains Oliver Schuster, CEO of Vossloh AG. "Vossloh 
has more than 130 years of experience in the development and production of 
track components. By combining cutting-edge measurement and analysis 
technology, a purpose-built data platform and a comprehensive range of 
services, we are able to offer our customers unique comprehensive solutions 
with regard to availability. Switches are the most complex and 
maintenance-intensive element and are particularly important in this 
context. With the order we recently won for the data-based condition 
monitoring of switches in Sweden, we and our strategic partner Deutsche Bahn 
Systemtechnik booked a major success." 
 
Vossloh's existing business with products and conventional services forms 
the basis for the development and expansion of the digital-based service 
business. The conventional hardware business and the constantly growing 
service business form an inseparable unit. The new possibilities afforded by 
digitalization and, most importantly, the efficient processing and analysis 
of large amounts of data serve as the link that joins the business models. 
 
*Preliminary outlook for 2021 and medium and long-term ambitions * 
For the coming 2021 fiscal year, the Executive Board currently anticipates 
Group sales within a range of &euro850 to 925 million as compared with the 
&euro870 million most recently projected for the current 2020 fiscal year. 
With regard to EBIT and EBITDA (earnings before interest, taxes, 
depreciation and amortization), the Executive Board anticipates margins for 
2021 of between 7 and 8 percent and between 13 and 14 percent, respectively. 
Adjusting for this year's one-time effect of roughly &euro15 million from 
the transitional consolidation of a joint venture in China, this corresponds 
to a significant year-on-year increase in operational profitability. The 
preliminary outlook for the 2021 financial year is subject to no significant 
new, unplanned impacts related to the COVID-19 pandemic. 
 
Against the backdrop of the successful implementation of the strategy 
presented and based on the information currently available, the Executive 
Board expects Vossloh AG to achieve average annual sales growth of 4 to 5 
percent in the medium term. This is significantly higher than the average 
market growth anticipated by relevant market studies. With regard to the 
operating result, EBIT (earnings before interest and taxes), the Executive 
Board is aiming for double-digit margins in all divisions of the Company in 
the medium term. This is an intermediate step toward the long-term goal of a 
double-digit EBIT margin for the Group, corresponding to an EBITDA margin of 
roughly 16 percent. 
 
*Contact information for the media:* 
Gundolf Moritz (Mirnock Consulting) 
Phone: [phone] 
Email: [e-mail] 
 
*Contact information for investors:* 
Dr. Daniel Gavranovic 
Phone: [phone] 
Email: [e-mail] 
 
Vossloh is active in rail technology markets worldwide. The Company's core 
business is rail infrastructure. The Group's activities are organized into 
the three divisions of Core Components, Customized Modules and Lifecycle 
Solutions. In the 2019 fiscal year, Vossloh achieved sales of &euro916.4 
million with an average of 3,786 employees. 
 
Vossloh AG * Vosslohstrasse 4 * 58791 Werdohl, Germany * Telephone +49 (0) 
239 252-0 * Fax [phone] * www.vossloh.com 
Company headquarters: Werdohl, Germany * Commercial register: Local court of 
Iserlohn HRB 5292 
Chairman of the Supervisory Board: Prof. Dr. Rüdiger Grube 
Executive Board: Oliver Schuster (CEO) * Dr. Thomas Triska * Jan Furnivall 
 
2020-12-15 Dissemination of a Corporate News, transmitted by DGAP - a 
service of EQS Group AG. 
The issuer is solely responsible for the content of this announcement. 
 
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Archive at www.dgap.de 
Language:    English 
Company:     Vossloh Aktiengesellschaft 
             Vosslohstr. 4 
             58791 Werdohl 
             Germany 
Phone:       [phone] - 359 
Fax:         [phone] - 219 
E-mail:      [e-mail] 
Internet:    www.vossloh.com 
ISIN:        DE0007667107 
WKN:         766710 
Indices:     SDAX 
Listed:      Regulated Market in Dusseldorf, Frankfurt (Prime Standard); 
             Regulated Unofficial Market in Berlin, Hamburg, Hanover, 
             Munich, Stuttgart, Tradegate Exchange 
EQS News ID: 1155303 
 
End of News DGAP News Service 
 
1155303 2020-12-15 
 
 

(END) Dow Jones Newswires

December 15, 2020 10:48 ET (15:48 GMT)