Masterflex achieves record result in the first half of 2022 - Consolidated operating EBIT rises by 82%

Gelsenkirchen, 10 August 2022 - In the first half of 2022, the Masterflex SE (ISIN: DE0005492938) seamlessly continued its successful business development from the previous year. Despite the challenging framework conditions with regard to supply chains, high energy and raw material prices as well as the ongoing war in Ukraine and the associated economic uncertainties, Masterflex generated its best result since the IPO in the period from 1 January to 30 June 2022 following significant revenue growth. 

Masterflex closed the first half of 2022 with a 26.3% increase in revenue to EUR 49.1 million (previous year: EUR 38.9 million). Operating earnings before interest and taxes (operating EBIT) jumped by 82.0% to EUR 6.7 million (previous year: EUR 3.7 million). This corresponds to an operating EBIT margin of 13.6% (previous year: 9.5%) in relation to revenue. The margin has thus stabilised in the double-digit range, so that the target of a double-digit EBIT margin formulated as part of the "Back to Double Digit" programme has been met and the programme has thus been successfully completed. In the first half of 2022, Masterflex recorded growth of 91.3% in consolidated earnings to EUR 4.7 million (previous year: EUR 2.4 million). Accordingly, earnings per share almost doubled to EUR 0.49 after EUR 0.25 in the same period of the previous year.

The successful business development is also reflected in the balance sheet as of 30 June 2022. Equity increased by 9.5% from EUR 45.0 million at the end of the 2021 financial year to EUR 49.2 million. This results in an improved equity ratio of 58.0% after 56.7% as of 31 December 2021.

The excellent business development in the current year is primarily based on a high demand dynamic from the classic industrial hose business, especially from the mechanical engineering, automotive and aviation sectors. In addition, the easing of Corona restrictions is having a positive impact on the medical technology business, which was adversely affected in previous quarters by Corona-related postponements of operations and the associated lower demand for corresponding consumables. The share of the high-margin medical technology business in total revenue rose accordingly to 18% (previous year: 17%). With regard to the individual sales regions, Germany, Europe and the USA stand out in particular, where all companies grew compared to the previous year, while activities in Asia were flat or declined slightly, particularly due to the renewed lockdowns in China.

The development of earnings was mainly characterised by the development of raw material, energy and logistics costs. However, Masterflex was able to compensate for the inflationary trends through economies of scale in the course of volume increases and thus productivity progress and price adjustments. The personnel utilisation rate, which improved to 33.1% compared to 37.8% in the previous year, should be emphasised here. The measures implemented contributed significantly to the positive margin development.

With a view to the rest of the year, the outlook is fundamentally positive based on a continued good order situation and stable demand from all customer industries. Compared to the good level of EUR 22.9 million as of 31 December 2021, the order backlog has increased by a further 17.9% to EUR 27.0 million as of 30 June 2022, so that the Management has every reason to be optimistic about the second half of the year.

Dr Andreas Bastin, CEO of the Masterflex Group: “As a Masterflex team, we can be proud of what we have achieved in the first half of the year. We have reached a record result despite major challenges from external influencing factors and continue to experience dynamic demand for our hose solutions from all industries. Assuming that there is no significant deterioration in the availability of raw materials, price trends and, above all, energy supplies, and that the international Corona situation remains reasonably manageable, Masterflex is heading for a record year.”

Masterflex is above plan with regard to the targets for 2022 communicated in the annual report. However, the Company is still exposed to imponderables that are beyond the control of the Management. These relate especially to the indirect consequences of possible Corona measures in the second half of the year as well as the ongoing war in Ukraine, which has an impact on the availability and price of raw materials and intermediate products. In addition, there are uncertainties regarding the energy supply, which could indirectly influence the supplier side in particular and thus also the business development at Masterflex. These factors, as well as commercial caution, currently still stand in the way of a more optimistic outlook for the full year 2022. The Management therefore confirms the present forecast, which foresees an increase in revenue to between EUR 83 and 87 million and an operating EBIT of between EUR 8.3 and 9.0 million for 2022. 

Selected key figures

*) unaudited

The semi-annual report as at 30 June 2022 is available on the Internet at www.masterflexgroup.com/investor-relations/financial-reports-of-masterflex-se/.