Train-maker Stadler seeks to reassure investors after flood disruption
By Louis van Boxel-Woolf
(Reuters) – Train-maker Stadler Rail’s CEO sought to reassure markets on Thursday, promising the company would recover from disruption caused by flooding across Europe and supply chain issues that led the company to suspend its outlook.
The Swiss-listed shares traded 11% lower at 1138 GMT in response to the company’s withdrawal of its outlook for 2025 and 2026 after the market close on Wednesday. It had lost as much as 16.2% earlier on Thursday.
“During the pandemic in 2021, we were unable to deliver 130 trains because of supply chain disruptions and travel restrictions”, CEO Markus Bernsteiner told a call to analysts and media.
“We recovered by 2022. That shows we can overcome this kind of situation. We’ll do it again.”
After deadly floods in Spain last month, the company’s plant in Valencia was not directly hit but around 30 of its suppliers in the region were, the CEO said.
As a result, between 150,000 and 200,000 production hours at the Valencia plant would be deferred from this year to 2025, he said, adding the full extent of the problem was unclear.
A Constellium factory in Switzerland that supplies aluminium parts was also hit by a storm in June, meaning deliveries are expected to be delayed until August next year.
Flooding in September at a site in Lower Austria destroyed a train, Bernsteiner said, adding that measures were taken to resume production as quickly as possible in all cases.
Supply chain problems related to the COVID pandemic and the war in Ukraine meant 376 of a possible 1,500 underground carriages have so far been ordered as part of a 2019 framework contract with the Berlin Transport Authority, Bernsteiner said, leading to underproduction at plants.
CFO Raphael Widmer said Stadler’s core profit margin for the year would be at least two percentage points lower than the previous 5% guidance.
The company plans to issue new guidance for 2025 and 2026 in the first quarter of next year.
Stadler last year made sales of 3.6 billion Swiss francs ($4.04 billion)compared to sales of almost 10.6 billion euros ($11.14 billion) for Siemens’ AG train-making business.
($1 = 0.8902 Swiss francs)
($1 = 0.9511 euros)
