Pierer Mobility AG, the parent company of KTM, has reported preliminary figures for 2024. As per the report, the company expects sales of EUR 1.9bn, 29% down from EUR 2.66bn in 2023. The board expects a EUR 300m negative EBITDA for the year due to a decline in operating performance and one-off restructuring expenses. EBITDA in 2023 was EUR 324m (positive).
During the year, the dispatches to dealers stood at 292,497 motorcycles, a 21% decline from 2023 dispatches of 372,511 motorcycles. This included 60,000 units sold by partner Bajaj Auto in India and Indonesia.
Worrying, but expected, is that Pierer expects a high negative triple-digit million cash flow. This will further inflate the debt.
The only positive that we could see is that inventory reduction is happening. Retail sales were around 268,000 units, the same as last year. However, KTM dropped production due to plant closure at the end of the year and has managed to reduce 40,000 units of the 300k+ units inventory.
Management Reshuffle continues
In the continuing management reshuffle, Stefan Pierer has stepped down as the CEO, and co-CEO Gottfried Neumeister has assumed the responsibility. Pierer would remain co-CEO till the restructuring is completed.
Impact
Inventory reduction is the main focus here and it may be happening through discounts and price reductions. The drop in revenues is much higher than the drop in unit sales, which may also mean that KTM's product mix has moved even more toward smaller engine capacity motorcycles made by Bajaj Auto.
Stefan Pierer's leaving was expected, considering the whole fiasco can be attributed to a prolonged lapse of judgment by KTM's senior management.
We have been extensively covering the issue in our previous posts.
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