Claas reports net sales of just under €5.0 billion for the 2024 financial year; €1.1 billion (19%) lower than the same 12 months in 2023.
The company says that tight producer prices, elevated interest rates, severe weather conditions and geopolitical tensions have led to a lot of uncertainty, and farmers and contractors are hesitating about buying new tractors and machines.
Despite the drop in net sales, Claas reckons to have successfully navigated a tough industry environment in its 2024 fiscal year (ended September 30). Operating profit before depreciation was €584 million (€769 million in 2023), and net income for 2024 was €253 million (previous year €347 million).
“We have performed well in the tense and highly competitive agricultural machinery market,” says CFO Henner Böttcher. “Despite a significant decline in sales, our strong earnings demonstrate our resilience. Today, it is paying off that we adapted our structures and processes early, amid a phase of high market dynamics and increasing geopolitical uncertainties.”
While 2024 has tested the business, Claas CEO Jan-Hendrik Mohr says that the business has remained on course, adding that it is crucial to stand together, manage costs efficiently, and proactively advance the business. “We have once again increased our R&D expenditure to over €330 million and made targeted investments in future projects, new technologies and our production network. In this way, we ensure sustainable growth and drive innovation.”
Targeted investments in the production network include the extensive modernisation work currently taking place at a number of Claas plants. These include Bad Salgau (forage harvesting technology) in Germany, where the company is modernising the infrastructure and production facilities to not only adapt the structures and processes to the expanded product portfolio, but also expand production capacities. The Harsewinkel plant (combine harvesters, forage harvesters and Xerion tractors) will soon be modernised with more automated systems.
Looking ahead, Claas says that the current industry trend is driven by reduced investments by farmers, most of whom have seen producer prices fall sharply to below average levels. With no upward trend currently in sight, the company expects a moderate decline in sales in 2025 and a noticeable decline in income before taxes.
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