Liebherr posts highest-ever turnover despite Middle East revenue drop
The Swiss manufacturer said its Africa, and Near and Middle East revenue "recorded a fall last year", adding that demand within its concrete technology division "slowed at times to a complete halt" in Saudi Arabia, Egypt, and Algeria
Swiss equipment manufacturer, Liebherr Group, has posted the highest turnover in its history, despite recording "a fall" in the Near and Middle East region.
The company recorded sales worth $12.1bn (EUR9.8bn) in 2017, and a revenue hike of 9.3% during the year, while its construction machinery and mining equipment sales rose by 14.5% to $7.6bn (EUR6.18bn).
Liebherr said it noted a significant turnover hike in Western Europe, its "most important sales region", while its sales performance in Eastern Europe – particularly Russia – "was encouraging" as well.
Revenues also recorded an annual increase in the Far East, Australia, and America markets, Liebherr said, adding: "The Near and Middle East, and Africa, however, recorded a fall."
In 2017, Liebherr's workforce increased to 43,869 employees – an annual increase of 3.7 %.
However, while employee numbers in Liebherr companies in Europe, America, and the Far East / Australia rose, in Africa and the Middle East, "there was a fall in the size of the workforce", the company said. Construction Week has contacted Liebherr for additional details about the workforce reduction.
NEXT PAGE: Liebherr's performance in the Middle East
Despite increased demand in the Western Europe and North America regions, Liebherr's concrete technology division recorded an annual revenue decline of 10.7% last year.
"In the Near and Middle East, the sector continued to suffer, due in particular to the ongoing conflicts in the region," the manufacturer said, commenting on its concrete business.
"The poor underlying conditions in the Near and Middle East also left their mark on the division.
"In the key markets of Saudi Arabia, Algeria, and Egypt, demand slowed at times to a complete halt."
Liebherr's mobile cranes division, which recorded a 0.7% revenue decline in 2017, was also impacted by the Near and Middle East, despite positive performances in other markets.
"The generally positive development in the Far East / Australia region stands in contrast to the significant downturn in sales in the Near and Middle East," the company said.
The manufacturer did not reveal additional details about its Middle East operation, but said that the Near and Middle East, along with Eastern Europe, had been "extremely favourable" for its maritime cranes business.
Additionally, the Near and Middle East also benefited Liebherr's earthmoving division – with the unit "more than doubling its revenues" in the region – as well as its tower cranes business, which witnessed a 15% rise in regional sales.
Construction Week has approached Liebherr for additional details of its performance in the Middle East last year as well as its plans for the region in 2018.
Liebherr revealed that while its operating result improved by 11% in 2017, positive currency movements in the previous year led its financial result to "sharply" fall during the year.
NEXT PAGE: Future business plans revealed
Overall, the company posted a 1.5% annual turnover hike – to $4.5bn (EUR3.6bn) – in its maritime cranes, aerospace and transportation systems, machine tools and automation systems, domestic appliances, components, and hotels divisions.
Liebherr said it expected its turnover to increase in 2018, and that it anticipated "growth in the construction machinery and mining segments".
"Appreciable gains are forecast in the mining, concrete technology, machine tools and automation systems, and earthmoving divisions," the company added in a statement.
"This is clear from the order book for 2018, which is already looking very good."
Energy efficiency, automation, and lightweight product design were among the key areas of focus for Liebherr last year, and the company said it made "substantial progress [...] in all product divisions" with these goals.
Lieberr's first system demonstrators for fully electric air-conditioning and de-icing systems were developed in 2017, and in the same year, it began work on the HLC 295000 heavy-duty crane.
The heavy-lift crane, with a load capacity of 5,000t, and a maximum lifting height of more than 170m, will be the largest crane ever developed by Liebherr.
HLC 295000 is intended for use in the installation of wind farms, in the decommissioning of offshore installations, and in the oil and gas sector.