News Dairy
Strong results for Dutch robot builder Lely
Lely has achieved a record profit in 2023, after red figures were reported a year earlier due to an expensive settlement in the United States. The machine builder had already reported in February that revenue had increased by a quarter, and now it appears from recently filed Chamber of Commerce data that profitability has greatly benefited from this.
From a turnover of almost €888 million, a net profit of €59.5 million emerges. This has never been so high and represents a respectable net profit margin of 6.7%. In 2022, Lely incurred a loss of €18 million due to a settlement of as much as €49.5 million with dissatisfied American dairy farmers. CEO André van Troost already stated that this was a one-time event and that the company was fundamentally in good shape.
The solvency of 32% confirms this, although the balance sheet is not considered very strong. However, as the profit in 2023 went entirely to the reserves, the solvency improved significantly. A year earlier, this was only about 15%, which is generally considered weak. Due to the good figures and balance sheet improvement, the 75th anniversary celebrated extensively last summer gets an extra nice touch.
Caveat
At the beginning of this year, CEO André van Troost looked reservedly ahead to the current year. The low milk price and high interest rates made 2024 seem like a challenging year in terms of sales, according to his thoughts. Meanwhile, milk prices are rising significantly and interest rates are falling, which theoretically improves the investment willingness of dairy farmers.
