Strong Vision Care Performance Helps Zeiss Achieve Record Sales in FY 2018/19

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Prof. Dr. Michael Kaschke, president and CEO of the Zeiss Group, speaking at Wednesday’s press conference.
OBERKOCHEN, Germany—Boosted by a strong performance by its Vision Care business, the Zeiss Group continued its growth trajectory, with revenue and earnings reaching new heights in fiscal year 2018/19 ended September 30, 2019. The company reported Wednesday that revenue grew by 11 percent, reaching €6.428 billion, up from €5.817 billion the previous year. Adjusted for currency and acquisition effects (like-for-like), revenue rose by 8 percent. At €1.063 billion, earnings before interest and taxes (EBIT) were significantly higher than €772 million the prior year. The EBIT margin was 17 percent. Incoming orders increased by 9 percent, reaching €6.575 billion for the first time.

"All Zeiss segments have developed extremely well. This is quite remarkable, especially in the midst of an uncertain economic climate and profound structural change in different industries," said president & CEO, Prof. Dr. Michael Kaschke in a statement. "Zeiss has consistently prepared for these scenarios and is well-positioned for the future as well as resilient thanks to its corporate strategy, the Zeiss Agenda 2020. Moreover, as a global technology leader, Zeiss is on its way in many segments and areas to becoming a shaper in its markets.”

In 2018/19, the Zeiss Group saw robust growth in all segments. The launch of new innovations contributed to the Medical Technology segment's growth, which enjoyed particularly strong growth in APAC. There was greater demand for both microsurgery and ophthalmology solutions. The strategic business unit Vision Care, which is part of the Consumer Markets segment, enjoyed above-market growth that also outpaced the competition, especially in emerging markets, and its revenue surpassed the billion euro mark for the first time.

In 2018/19, the Zeiss Group generated approximately 90 percent of its revenue outside Germany. With a revenue increase of 15 percent (like-for-like), the dynamic national economies in the APAC region in particular continued to drive this positive trend, Zeiss said. In the EMEA region, Zeiss was able to further grow with an 8 percent increase in revenue (like-for-like). In the Americas region, revenue of €1.347 billion was 2 percent higher than last year's figure (like-for-like). Zeiss said it has not yet fully leveraged the potential for growth in Germany.

To support the development of new technologies, Zeiss said it increased its R&D budget by 10 percent in fiscal year 2018/19, raising it from €642 million in 2017/18 to €705 million.

On the path to becoming carbon-neutral, the company has decided to switch to a CO2-neutral energy supply in Germany by 2022. "We are making a real difference by implementing a great number of concrete measures to reduce CO2 emissions and protect the climate," said Dr. Christian Muller, CFO.

Zeiss noted that uncertain market conditions in 2020 may impact its earnings. "While the current number of incoming orders is reason to be optimistic, we do not presume that Zeiss, for all its strengths, can remain completely unaffected by economic fluctuations. That is why we are working specifically on strengthening our ability to adapt and our resilience," said Kaschke. "The goal for fiscal year 2019/20 is to once again increase revenue and continue to achieve a high EBIT margin of over 10 percent—a challenging goal in light of the economic downturn and the need to maintain our significant R&D expenditures."