Press release:
Rational AG: strongest half year in terms of sales revenues – nevertheless cautious

• Second-quarter sales revenues above pre-crisis level, at 232 million euros, despite despite material bottlenecks
• iVario defies supply difficulties and grows by 50 percent
• Sales revenues positively influenced by after-sales activities, price increases and currency effects
• New orders and orders on hand persist at high level
• 20 percent EBIT margin in the first half of 2022
• Awards for Rational: best employer brand and among the 100 most sustainable companies in the SME sector

Landsberg am Lech, 3 August 2022     "Since reaching an absolute peak in March, our monthly new orders have increasingly normalised. But that does not mean that our cooking systems have become less attractive. On the contrary – even after the worldwide price adjustments, orders have continued at an encouraging level,” says CEO of Rational AG, Dr Peter Stadelmann, commenting on the situation. In the second quarter, orders received again slightly exceeded the number of appliances sold. Orders on hand therefore rose again as at 30 June 2022, reaching an exceptionally high level at around 400 million euros or approximately 44,000 appliances.

Sales revenues of 232 million euros in the second quarter of 2022 – 458 million euros in the first half of 2022 – best quarter and best half year in the company’s history
As in the first quarter, Rational was again affected by the low availability of processors (CPUs) in the second quarter of 2022. “The fact that, despite the limiting factors, we achieved the highest quarterly and half-yearly sales revenues in the company’s history demonstrates the resilience of our business model. In particular cleaners, service parts and accessories have enjoyed a very dynamic performance in the fiscal year to date,” says CFO Jörg Walter.

From a regional perspective, growth rates compared with the first half of the previous year ranged from –9 percent in Asia to +61 percent in Latin America. Europe (excluding Germany) and Germany exceeded the prior-year period by 23 percent and 28 percent respectively. In North America, sales revenues expanded at a rate of 25 percent.

Sales revenues by product group: iVario defies supply difficulties and grows by 50 percent
Both product groups of the Rational Group contributed to growth. In the iCombi product group, sales revenues were up 17 percent year on year in the first half of 2022, at 395.1 million euros (2021: 337.6 million euros). In the iVario product group, sales revenues rose by 50 percent to a new record level of 62.6 million euros (2021: 41.7 million euros). The iVario’s potential is increasingly spreading to all regions of the world. Year-on-year, the sales volume rose by 39 percent. “The huge demand and positive feedback from our customers – including in the overseas regions supplied since 2020 – confirm our long-term strategy. Just like the combi steamer once did, the iVario will revolutionise the professional kitchen,” states Dr Stadelmann.

54 percent gross margin and 20 percent EBIT margin in the first half of 2022
As a result of the rise in cost of sales, which noticeably outpaced the increase in sales revenues, Rational AG’s gross margin stood at 54.0 percent in the first six months of 2022 (2021: 56.3 percent). Although the massive cost increases in materials procurement and logistics can increasingly be felt already, the price increases for Rational cooking systems are only taking effect with a time lag. Nevertheless, EBIT (earnings before interest and taxes) still rose by 10 percent to 93.1 million euros. However, given these conditions, the EBIT margin declined to 20.3 percent for the first six months (2021: 22.3 percent). The EBIT margin was buoyed somewhat in the first half of 2022 by the fact that, at 156.0 million euros, operating costs expanded more slowly than sales revenues (2021: 131.1 million euros). In addition, currency gains of 0.9 million euros (2021: 1.3 million euros) had a positive effect.

Rational invests in new staff and wins award for its employer brand
At the end of the second quarter, the Rational Group had 2,341 employees (31 December 2021: 2,248), who are internally referred to as entrepreneurs within the enterprise (U.i.U.s). Of this total, 1,345 work in Germany (31 December 2021: 1,285). “Our salary increases are usually based on and exceed the adjustments negotiated by the IG Metall union. We increased the salaries of our U.i.U.s employed in Germany by 5.1 percent as at 1 July 2022 and will continue to monitor the inflation trend closely,” says the CEO. “We are also especially pleased about the award for our employer brand ‘Das Beste vereint!’ (A perfect match), which presents us as a modern, young company,” he adds.

RATIONAL recognised as one of the most sustainable SMEs
With its products that save energy and resources, offer safe and ergonomic workplaces, and prepare healthy food, Rational has been making thousands of customer companies more sustainable for decades. In addition, we strive to make our own value creation as sustainable as possible and minimise our ecological footprint. We are delighted that the WirtschaftsWoche counts us among the most sustainable companies in Germany in its issue number 26 published at the end of June. In the ranking, compiled in collaboration with the Munich Strategy consulting firm, we are proud to rank 32nd.

 Outlook confirmed
“At present, future sales revenue performance depends less on market developments and order trends, but is rather determined by the availability of components, especially electronic components. The material risks continue to exist and are difficult to forecast. Cost increases and supply shortages as a result of the lockdowns in Shanghai and the Ukraine crisis will continue to affect us indirectly,” states CFO Walter, looking ahead to the second half of the year. It was, moreover, hard to assess the consequences that potential gas rationing could have on suppliers and Rational. On the other hand, the company took note that the increases in selling prices were beginning to have an effect, and this would be reflected in the second half of the year.

Based on the sales revenue performance in the first six months and the expectations for the remainder of the fiscal year, Rational is confirming the forecast for 2022. “We anticipate sales revenue growth of 10 to 15 percent compared with the previous year and an EBIT margin slightly up on the previous year. If the risks identified materialise to a greater extent than the first seven months have suggested so far, we expect slower sales revenue growth and an EBIT margin below that of the previous year,” says Dr Stadelmann with reference to the unchanged outlook for the current calendar year. In a friendlier environment with stable availability of parts and positive effects from price increases and foreign currencies, a sales revenue level at the upper end of the forecast or slightly higher is realistic. Since the continuing cost pressure has a negative impact of the EBIT margin, Rational also expects an EBIT in line with the original expectations in absolute terms.

Contact:

Rational Aktiengesellschaft

Stefan Arnold / Head of Investor Relations
Tel. +49 (0)8191 327-2209
Fax +49 (0)8191 327-72 2209

E-mail: ir@rational-online.com
www.rational-online.com

Editorial note:

The Rational Group is the global market and technology leader for thermal preparation of food in professional kitchens. Founded in 1973, the company employs around 2,300 people, over 1,300 of whom are in Germany. Rational was floated in the Prime Standard of the German stock market in 2000 and is currently represented in the MDAX.

The company’s principal objective is to offer maximum customer benefit at all times. Rational is committed to the principle of sustainability, which is expressed in its corporate policies on environmental protection, leadership, job security and social responsibility. Numerous international awards bear witness to the high quality of the work done by Rational’s employees year for year.