EQS-News: PIERER Mobility adjusts guidance and responds to tougher global conditions

EQS-News: PIERER Mobility AG / Key word(s): Change in Forecast/Strategic
   Company Decision
   PIERER Mobility adjusts guidance and responds to tougher global conditions

   14.06.2024 / 17:55 CET/CEST
   The issuer is solely responsible for the content of this announcement.

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   Corporate News

   Wels, June 14, 2024

    

   PIERER Mobility adjusts guidance and responds to tougher global conditions

    

     • Sales fall short of expectations due to persistently high interest
       rates in the USA and volatile market environment in Europe
     • Comprehensive package of measures being implemented:

          • Tighter cost management and reduction of production volumes in
            Austria
          • Expansion of the supply chain in India and China
          • Realignment of the bicycle division

     • Adjustment of guidance for the 2024 financial year

    

    

   Sales fall short of expectations due to persistently high interest rates
   in the USA and the volatile market environment in Europe

    

   In the current financial year, momentum in PIERER Mobility's core
   motorbike markets in the USA and Europe has slowed significantly. Due to
   the latest interest rate decisions in the USA, interest rates are expected
   to remain high, which will have a negative impact on sales expectations
   for the American market. Sales figures in Europe are also still volatile.
   Overall, PIERER Mobility's sales figures will fall short of expectations
   this year after three years of above-average success.

    

   This means that dealers will have to reduce their inventories and thus
   continue to tie up considerable capital. The PIERER Mobility Group is
   therefore continuing its efforts to strengthen its dealer structure
   through extended payment terms and higher discounts. These measures have
   already led to a sharp increase in working capital in the past financial
   year. Management expects working capital and the associated capital
   commitment to remain high in 2024. This is expected to have a significant
   negative impact on EBIT and the financial result in the current financial
   year.

    

   Tighter cost management and reduction of production volumes in Austria

    

   The production costs of motorbikes in Europe have risen due to high wage
   settlements and increasing costs in connection with regulations and
   bureaucracy, putting a strain on competitiveness. Production volumes are
   therefore being significantly reduced at the production site in
   Mattighofen. At the same time, the company is tightening cost management
   throughout the Group.

    

   With the growth in sales figures over the last ten years, the number of
   employees at the motorbike subsidiary KTM AG has more than doubled. In
   view of the changed location and market situation, the number of employees
   has now had to be adjusted. This reduction in personnel after years of
   rising employment is painful, but necessary in order to maintain and
   secure the competitiveness of the production site.

    

   Expansion of the supply chain in India and China

    

   Another priority in 2024 is to increase efficiency in product development.
   The focus will be on aligning and prioritizing activities in line with the
   Group's premium brand strategy and streamlining development processes.
   Following on from this, joint research and development with the strategic
   partner Bajaj Auto in India and the JV partner CFMOTO in China will be
   expanded at the respective locations.

    

   Due to the increasingly fragile supplier industry in Europe, the PIERER
   Mobility Group is utilizing the favorable economic conditions in these
   regions to secure its competitiveness. An efficient and high-quality
   supplier industry is being established there.

    

   Realignment of the bicycle division

    

   During the coronavirus pandemic, demand for bicycles rose rapidly, leading
   to overheating in the bicycle market and disruptions throughout the entire
   supply chain. As a result, our own stocks and those of suppliers and
   dealers reached record levels. The reduction of these inventories to a
   normal level is continuing, while at the same time massive pressure is
   being exerted on sales prices.

    

   Due to the developments described above, the extraordinary impairment and
   restructuring requirements in 2024 will lead to a significantly negative
   result in the Bicycles segment.

    

   The realignment of the Bicycles segment initiated in the 2023 financial
   year with a focus on the premium segment will be systematically
   implemented and completed in 2024.

    

   Adjustment of the guidance for the 2024 financial year

    

   For the 2024 financial year, the Executive Board expects a decline in
   sales of 10% to 15% for both the motorcycles and bicycle divisions due to
   the current market developments.

    

   In the Motorcycles segment, the Executive Board assumes that the cost
   savings introduced in the current financial year will be able to
   compensate for the negative effects of declining sales to such an extent
   that a balanced to slightly positive EBIT can be generated. The
   development of existing dealers and the further expansion of the dealer
   network to support the brand strategy will be key issues in 2024.

    

   In the Bicycle division, however, the Executive Board anticipates a
   significantly negative EBIT of €-110 to €-130 million for the 2024
   financial year, which is essentially due to the above-mentioned
   extraordinary impairment and restructuring requirements. The restructuring
   of the Bicycle division is therefore complete.

    

    

   About the Group

    

   PIERER Mobility AG is the holding company of Europe’s leading manufacturer
   of powered two-wheelers, producing a full range of premium brands
   including KTM, GASGAS, Husqvarna and MV Agusta Motorcycles. With its
   innovative strength, PIERER Mobility is a pioneering technology leader in
   two-wheeled e-mobility through its motorcycle brands. In the bicycle
   sector, the focus is on the premium segment. In the bicycle sector, the
   focus is on the premium segment. The premium brand range also includes
   high-performance components under the WP brand and special KTM X-BOW
   high-performance sports cars.

    

   Legal disclaimer

    

   THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER OF SECURITIES FOR SALE OR A
   SOLICITATION OF AN OFFER TO PURCHASE SECURITIES OF PIERER MOBILITY AG. IT
   IS NOT FOR DISTRIBUTION, TRANSMISSION OR PUBLICATION, DIRECTLY OR
   INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, AUSTRALIA,
   CANADA, JAPAN OR SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH THE
   DISTRIBUTION OF THIS ANNOUNCEMENT WOULD BE UNLAWFUL.

    

    

   Contact:

   Investor Relations

   Melinda Busáné Bellér

   Tel: +43 (0) 1 533 1 433 - 70

   Email: ir@pierermobility.com

   Website: [1]www.pierermobility.com

    

   ISIN: AT0000KTMI02; Swiss Valor Number (Switzerland): 41860974; Ticker
   Symbol: PKTM; Bloomberg: PKTM SW, PKTM AV; Reuters: PKTM.S; PKTM.VI

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   14.06.2024 CET/CEST This Corporate News was distributed by EQS Group AG.
   www.eqs.com

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   Language:    English
   Company:     PIERER Mobility AG
                Edisonstrasse 1
                4600 Wels
                Austria
   Phone:       +43 (0) 7242 69 402
   E-mail:      ir@pierermobility.com
   Internet:    www.pierermobility.com
   ISIN:        AT0000KTMI02
   WKN:         A2JKHY
   Listed:      SIX, Vienna Stock Exchange
   EQS News ID: 1925903

   Valorennummer (Schweiz): 41860974 Wertpapierkürzel: PKTM Bloomberg: PKTM
   SW; PKTM AV Reuters: PKTM.S; PKTM.VI

    
   End of News EQS News Service


   1925903  14.06.2024 CET/CEST

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