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The Blueprint – June 2021

By Emily Halstenberg | June 14, 2021

The Blueprint – June 2021 Coverage
Actionable Intelligence for Leaders in the Architecture, Engineering, Environmental, Geospatial, and Construction Services Industries

Over the past decade, industrial manufacturers have faced pressure to make smaller and smaller products, in higher volumes, with greater flexibility – all at a reduced cost. In Automation World’s recent survey of more than 300 automation professionals from factories and processing plants, organizations shared plans for the future use of integrators. Nearly half of the respondents (46%) recently used a system integrator (within the past year). Only 25% of them have never used an integrator. The most significant benefit of using an integrator was the ability to complete a project that couldn’t have been done with in-house resources. In addition, 25% of respondents said they learned lessons about processes through the integration project that company personnel was unaware of before the project. Another noteworthy response is that there has been a net increase in internal automation engineering staff over the last three years, suggesting that companies will continue to hire in-house engineers if they can find them.

Organizations that adapted to the environment in 2020 were highly diversified, leaders in emerging technologies, and exceptional at risk management of their supply chains. These characteristics will continue to be essential to thrive in Industry 4.0. One organization that exemplifies these characteristics is Beckhoff Automation. “We don’t have more than 15% of our business in any one particular vertical,” said Kevin Barker, president of Beckhoff USA, “so when some of our existing customers did not invest in new theme parks or new oil and gas exploration, we still saw new projects with electric vehicles, semiconductor manufacturing, intralogistics, and packaging.”

Over the past twelve months, Industrial Automation stocks have been rising with the overall market. Since the end of October, the overall market and the Industrial Automation index have risen sharply. Industrial Automation stocks have continued to rise so far in 2021 and are hovering around 50% higher than last June. Revenue multiples have stayed in between 6x – 7x since January and are currently around 6x. EBITDA multiples have been around 25x since January of this year.
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