Interroll Holding AG (INRN) Earnings Call Transcript & Summary

For Interroll, financial year 2021 was dynamic and challenging. We were able to rely on our strength, and we overachieved our growth targets. Our global team stands as one. All 3 regions contributed to this success. We were able to realize significant growth in our sales and several large follow-on projects with existing customers were realized. This high level of trust is underlined by the order intake, which climbed significantly with the strongest year-on-year growth ever recorded in Interroll's corporate history. Despite a complicated situation for personal meetings due to the COVID-19 pandemic, we were able to deepen our relationships with customers and end users by organizing our truck roadshow across Europe, but we also continue to deepen our technology platform. With the launch of the Split Tray Sorter, we opened a new market segment for us in the basic segment of sorting equipment. The installed base in the market is now exceeding 500 sorters. Interroll Center of Excellence software electronics in Linz, Austria has developed our own Interroll sorter controls to extend our platform-based product portfolio and make our products even more simple to integrate and use. The Smart Pallet Mover has been awarded the E4 award as well as the Red Dot Design Award. It shows the power and braveness of Interroll to invest into new technologies. This innovative solution will increase Interroll's footprint in manufacturing logistics, an interesting growth market. Interroll's substantial investments over the past 10 years in our global digital infrastructure paid off. With the harmonization of digital production and business processes, we continue to make our customers' lives easy. But we do not stop here. We are preparing the transformation to the latest SAP S/4HANA enterprise resource planning platform and continue to push our business excellence forward. Supply chains proved to be a major challenge throughout the industry in 2021. Particularly in the second half of the year, we had to manage critical situations in terms of material availability and price increases as well as massively longer delivery times. Interroll countered this development with a task force team that stood and is staying in close contact with our customers to find best solutions under these difficult circumstances. We are handling today's challenges well, but we are also thinking long term. That is why we continue to shape the conditions for the sustainable growth of our business around the globe, and we continue expanding our production network. The new plant in Mosbach, Germany started its operational business in mid-2021. We are going to further invest in our site in Wermelskirchen and will extend our location in Baal to produce new material handling solutions for the food industry, which we will launch soon. Our extended plant in Suzhou, China will commence operation by the third quarter of 2022. But our most important asset are our people. We continue to invest in the training and development and foster the outstanding culture that makes Interroll the employer of choice for the talent within our industry and beyond. Looking into the medium future, Interroll is cautiously optimistic and anticipates positive momentum in the material handling market in general. At the same time, we are deeply concerned by the humanitarian crisis unfolding in the Ukraine. Although Interroll generated the recent years only a very small share of its sales in Russia and Ukraine, we have stopped business activity in both countries for the time being. The risks have increased with the war and the consequences for the global economy and material handling cannot be assessed at this point in time. Despite all challenges, we are aware that material handling was, is and will be of utmost importance to help the supply chain to stabilize and being able to deliver goods in the right time, the right place with a minimum amount of resources. Therefore, we will continue to seize our opportunities for organic growth. We will provide even more customer comfort through digitalization, and we will increase our focus on energy-efficient material handling solutions. At the same time, we will boost our customers' confidence in partnering with us to jointly shape the material handling market of the future, and we will continue our journey on environment, social and governance, in short ESG. For the financial year 2022, we will be working on a comprehensive sustainability report that will fulfill the standards of the global reporting initiative. We know our responsibility, and we are ready for what is ahead of us.