The arms manufacturer has often had bad numbers in the past: the business was in deficit and the debt was high. But now the demand for armaments is significantly higher.
The business of the largest German manufacturer of handguns, Heckler & Koch from the Black Forest, has weakened somewhat from a high level. At the general meeting of the gunsmiths in Rottweil, the board of directors presented a forecast according to which sales and earnings will fall in the current year compared to 2022. From the point of view of the management, a normalization of the previously very strong growth course is taking place. In 2022, sales rose by 5.1 percent to 305.1 million euros and the operating result (Ebitda) soared by 41 percent to 82 million euros within one year, also due to special effects.
Just a few years ago, Heckler & Koch was deep in the red and the company was burdened with a high mountain of debt. The last time a loss was recorded was in 2018, after which it kept going up until the “exceptional year” 2022, as H&K boss Jens Bodo Koch called it. Higher energy and raw material costs and negative currency effects are now making themselves felt in the current financial year. In the longer term, however, management is convinced that H&K will grow again. The board of directors emphasizes that the course for growth is intact.
increased demand
Against the background of the Ukraine war, the demand for armaments also increased in Western countries. H&K benefits from this as a manufacturer of assault rifles, machine guns, grenade launchers and pistols.
At the beginning of 2023, however, there were signs of slowdown in business: In the first quarter of 2023, sales fell by 4.3 million to 73.2 million euros compared to the previous year and the operating profit (Ebitda) fell by 2 million to 18 million euros. For the second quarter, the company expects similar sales and a slightly weaker operating result than in the first quarter.
Heckler & Koch had 1131 employees last year, 45 more than in 2021. A good 90 percent of them work at the main plant in Oberndorf am Neckar. Competitors include Smith & Wesson and Colt from the USA. In Europe, Beretta (Italy), FN (Belgium) and the Colt mother CZ from the Czech Republic are among the competitors. A smaller domestic competitor is the Thuringian gunsmith CG Haenel.
Source: Stern
