HAMBURG (dpa-AFX) - Despite declining demand, price cuts are not an option for the Board of Management of forklift manufacturer Jungheinrich at the moment. "Only if the markets were to collapse massively would targeted price reductions come into question for us, for example to ensure the capacity utilization of our plants," Chief Financial Officer Volker Hues said in an interview with financial news agency dpa-AFX in Hamburg on Monday. "However, we do not see that at the moment." Jungheinrich had been able to increase sales by a fifth in the first quarter compared to the same period last year, but received only one per cent more orders. According to Hues' estimates, these developments are likely to continue in the coming months, with profitability declining.

"We expect a steady order intake in the remaining three quarters, probably slightly below the level of the first quarter," he said. This is also reflected in the full-year forecast confirmed Monday, which management raised two weeks ago. According to this, incoming orders for the year as a whole are expected to be between 5 and 5.4 billion euros, which means that only in the best case scenario will the order volume of the first three months be repeated in the coming quarters.

However, Jungheinrich is relatively soft in this respect, as its order backlog of almost 1.6 billion euros at the end of last year is higher than the average figure for the preceding five years. At the end of the first quarter, orders on hand even totalled just under 1.8 billion euros. According to market experts, Jungheinrich benefits from customer groups that are relatively unaffected by economic cycles, such as food producers, as well as companies from the logistics, retail and wholesale sectors. They account for the lion's share of Jungheinrich's business.

Hues takes a correspondingly relaxed view of the current weakness in e-commerce, not least because, according to his own statements, he does not expect people's consumer behaviour to revert to old structures. "We at least are recording double-digit percentage growth in incoming orders and sales in our own e-commerce division," said the manager. He has also been responsible for the Mail Order Division on Jungheinrich's Board of Management for ten years.

Similar to incoming orders, the Hamburg-based company's operating margin is also likely to decline in the coming months. It was 9.3 per cent at the start of the year, but Jungheinrich's Board of Management expects it to be only 7.8 to 8.6 per cent for the year as a whole. "Our margin development in the first quarter can be primarily attributed to the price increases compared to the same period last year," Hues explained. "We will certainly see another strong second quarter. In the second half of the year, however, this price effect is then expected to weaken."

At the same time, however, the price increases and clauses are likely to lead to sales growth at Jungheinrich in the coming months, which is expected to move in the opposite direction to demand and margins accordingly. Extrapolated to the year as a whole, sales after the first quarter would only be at the lower end of the range of 5.1 to 5.5 billion euros.

Jungheinrich presented its detailed figures for the first quarter on Monday, confirming the preliminary results announced two weeks ago. After taxes, the Hamburg-based company earned 88.4 million euros in the first quarter, almost four-fifths more than a year earlier./lew/mne/mis

--- Interview: Leonie Weigner, dpa-AFX ---