Lemken well on track

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Lemken, the specialist for professional arable farming, upheld its strong market position last year in a difficult market environment and achieved sales revenue of EUR325 million at a similar level as in the prior year. The number of employees in the company increased by 100 to 1405, including 56 employees retained as part of the reintegration of the formerly independent welding department.

Business in the main markets in Europe, above all in Germany and France, continued to be weak, although the United Kingdom was relatively stable considering the impending exit from the EU. Increases in our Central and Eastern European business, where Romania, Hungary and Bulgaria are largest sales regions, were particularly good. Business also developed highly positive in Russia, another important agricultural market, and sales in Ukraine were even doubled. Lemken’s top 10 markets also include Canada and China, where the family enterprise established an own assembly and sales subsidiary three years ago.

Germany contributed 26 per cent to the total sales, the remaining Western European countries 28 per cent, Eastern Europe 33 per cent and the USA/Canada 6 per cent. The export share is currently 74 per cent and increased by EUR5 million to EUR241 million in the past year. The good results in the spare parts business also had a positive effect on the overall result. This was supported by the introduction of new sets of conditions and the implementation of our new service strategy for dealers.

Lemken manufactured a total of 12,809 implements in the past financial year. The plough product group makes up the largest share in the total production and also delivered the strongest growth compared to the prior year. The new implements to be launched on the market in 2017 include the Solitair 25 generation of pneumatic seed drills. Lemken will additionally bring its first single-seed drill on the market – the Azurit with initially 6 metres working width. There are also good news for fans of electronics: All ISOBUS-capable implements will be equipped with the smaller, more sophisticated CCI-50 terminal with a 5.6 inch display from 2017 onwards. Additional innovations will be introduced at the Agritechnica, where Lemken will be represented with a large stand in November.

“The past year has once again shown just how difficult it is to foresee specific developments”, said Anthony van der Ley, Managing Director, in commenting the results. “Overall we are very pleased that we delivered on our ambitious planning by the end of the year. This was mainly possible due to the outstanding commitment and flexibility of our employees. Also, the company’s various investments in manufacturing technology and logistics proved effective in allowing us to utilise existing production capacities optimally.”

A number of new buildings were indeed completed in 2016, including a new training facility, the Lemken AgroFarm with training halls and arable land for providing practical training to dealers and end customers, a new, larger sales location in France and a much expanded and modernised pre-fabrication department at the Alpen headquarters. However, the company also invested considerably in training employees and optimising workflows.

“These investments totalling EUR16 million in 2016 form part of our long-term plans. They are important for ensuring ongoing modernisation and maintaining a dynamic environment. As a family business, we act consistently and prudently, which will stand us in good stead once farmers’ revenue situation finally improves and the market for agricultural technology picks up again as a consequence”, Managing Director Anthony van der Ley continued. While the general environment of operation, which is characterised by population growth and increasing demands regarding food quality, supports a positive trend, Lemken expects business developments in 2017 to remain restrained.

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