Supply chain, logistics and inflation hamper Diebold Nixdorf, company reduces 2022 outlook
HUDSON – Higher costs, supply chain and global shipping problems, and a decreased value of the Euro continue to hamper Diebold Nixdorf's efforts to post a profit.
The company has an order backlog valued at $1.4 billion, and is proceeding with a plan to cut costs by $150 million, Octavio Marquez, president and chief executive officer, told stock analysts during a conference call Tuesday. Marquez took the helm at Diebold Nixdorf in March.
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Marquez said some of the Hudson-based company's supply chain issues are being addressed through the North Canton production center in the Hoover District. The facility, which is being expanded, is part of efforts to re-configure Diebold Nixdorf's supply chain.
By the end of this year, the North Canton plant should be providing 80% of the cash recycler automatic teller machines ordered by North American customers, Marquez said. Diebold Nixdorf consolidated its North American production at the site in 2019. The majority of the company's production is in Paderborn, Germany.
Marquez said 50% of Diebold Nixdorf's revenue is generated in the European market, while 40% of sales are in North and South American, with the remaining 10% in the Asia-Pacific market.
Diebold Nixdorf reported a loss of $199.2 million, or $2.52 per share, for the second quarter ended June 30, compared with a loss of $30.3 million, or 39 cents a share, in 2021. Revenue fell 9.7% to $851.7 million compared with $943.5 million last year. Revenue did improve by 3% over the $829.8 million reported in the first quarter.
Through six months, the company has a loss of $382.3 million, or $4.85 per share, compared with $38.4 million, or 49 cents per share, last year. Revenue came in at $1.68 billion, a 10.9% drop from $1.89 billion in the first half of 2021.
The company once again lowered its outlook for the coming year, with revenue projected to range between $3.55 billion and $3.75 billion.
Diebold Nixdorf ended last year with revenue of $3.905 billion, a slight increase from $3.902 billion in 2020. The company expected revenue to range between $4 billion and $4.2 billion when the year began, but lowered its outlook to a range of $3.7 billion to $3.9 billion when first quarter results were announced in May.
The company is working with advisers, banks and lenders to restructure its debt, Marquez and Jeff Rutherford, executive vice president and chief financial officer, told analysts. Rutherford said the company is having productive conversations.
Marquez also noted that some shareholders have asked about mergers, acquisitions and divestitures that the company might be considering. Examining such options are part of a constant effort to evaluate strategic alternatives that will benefit shareholders, he said.
This article originally appeared on The Repository: Diebold Nixdorf reduces 2022 outlook, cites supply chain, inflation
