Heidelberger Druckmaschinen AG (Heidelberg) (FWB: HDD) is
publishing its results for the first quarter of financial year
2009/2010 (April 1 to June 30, 2009). The persisting unfavorable
macro-economic climate and customers’ continued reluctance to
invest have collectively had a significant impact on business
during the reporting period.
In the period under review, incoming orders were up on
the previous quarter's figure of EUR 474 million at EUR 550 million
and thus appear to be stabilizing at a low level. They were 52
percent down on the figure for the same quarter the previous year,
which was boosted by the drupa trade show (previous year:
EUR 1.151 billion).
As a result of the global slump in demand in the industry, the
Heidelberg Group’s order backlog as at June 30, 2009 was 53
percent below the previous year’s value of EUR 1.298 billion at EUR
616 million.
“Incoming orders stabilized slightly in the first quarter
compared with recent months, providing an initial indication that
the downturn is leveling out. However, we still need to wait and
see how things develop,” stated Bernhard Schreier, CEO of
Heidelberger Druckmaschinen AG.
In the first three months of the financial year, the Heidelberg
Group generated sales amounting to EUR 514 million. This
figure is 22 percent lower than the EUR 657 million achieved in the
first quarter of the previous year.
The operating result excluding special items was EUR -63
million in the period under review (previous year: EUR -35
million). The net result in the first quarter was EUR -69
million (previous year: EUR -39 million).
Heidelberg achieved considerable success in limiting the outflow
of funds from free cash flow compared to the same quarter
the previous year through active control of working capital and
savings on investments. As a result, the free cash flow improved to
EUR -29 million (previous year: EUR -211 million), largely due to a
further cutback in inventory levels.
“Our package of cost-cutting measures is proceeding according to
plan,” said company CFO Dirk Kaliebe. “In the first three months of
the financial year, we achieved a further reduction in personnel
costs compared to the previous year, cut inventory levels, lowered
research and development expenditure, and cut back significantly on
investments. These savings contribute to compensating the impact
falling sales are having on the result,” he added.
Around half of the 5,000 job cuts announced by Heidelberg have
already been achieved or firmly agreed through socially acceptable
measures. To make further short-term savings on personnel costs,
the company is continuing to make use of short-time work throughout
Germany.
In the first quarter alone, just under 600 employees left the
Group (including approximately 60 temporary agency staff). As of
June 30, 2009, Heidelberg had a workforce of 18,353
worldwide (previous quarter: 18,926).
Results in the Press and Postpress divisions
As a result of the unfavorable economic situation, incoming
orders for the first quarter in the Press Division (offset
printing) remained at the low level of the previous quarters at EUR
493 million. This is 52 percent down on the figure of EUR 1.030
billion for the same quarter the previous year, which did, however,
include the high level of incoming orders from the drupa trade
show. Due to weak demand and the low order backlog at the beginning
of the quarter under review, the previous year’s sales figure was
not matched either. At EUR 460 million, sales were 19 percent
lower than the same quarter the previous year (previous year: EUR
568 million). The operating result was EUR -53 million (previous
year: EUR -29 million).
The Postpress Division (finishing) also suffered from the
unfavorable underlying conditions in the quarter under review and
only achieved incoming orders totaling EUR 52 million. This was 54
percent down on the figure of EUR 114 million for the same
quarter the previous year. At a level of EUR 49 million, sales were
40 percent down on the previous year’s figure of EUR 82 million –
double the rate of decline experienced in the Press Division. The
operating result excluding special items was EUR -13 million
(previous year: EUR -11 million).
All regions except North America recorded higher incoming
orders in the first quarter than in the previous quarter. In some
parts of the EMEA, North America, and Latin America regions,
incoming orders were more than 60 percent below the previous year’s
values due to the global financial and economic crisis. The
Asia/Pacific region recorded the smallest decline in incoming
orders compared to the previous year. Thanks to the China Print
trade show and the resultant healthy incoming orders on the Chinese
market, order levels were only 24 percent down on the previous year
at EUR 185 million. Sales were slightly up on the previous year’s
figure at EUR 150 million, with a significant increase recorded
primarily in China.
Due to the persisting difficult underlying conditions,
Heidelberg is still predicting that sales for financial year
2009/2010 as a whole will be below the very low level of
financial year 2008/2009. Although the cost-cutting measures
already initiated will help the company lower the break-even level
as quickly as possible, the sharp rise in refinancing costs, which
also include the cost of the guarantees in the Economic Stimulus
Package II, will weigh heavily on the financial result.
Consequently, Heidelberg is expecting a negative result for
financial year 2009/2010.
Heidelberg concludes negotiations on new financing
concept
On August 7, 2009, Heidelberg successfully concluded
negotiations on loan agreements with its banks, thereby securing
its medium-term financing structure. The components of the
financing package include state guarantees and an indemnity from
the KfW. The deeds of guarantee will be issued and sent out before
the end of August. This provides the company with a credit line
totaling EUR 1.4 billion for the period up to the middle of
2012.
The complete report for the first quarter of financial year
2009/2010 is available online at www.heidelberg.com.
For additional details, please visit the Internet Press Lounge
at www.heidelberg.com.
Other dates:
Publication of the half-yearly results for financial year
2009/2010 is scheduled for November 10, 2009.
Important note:
This press release contains forward-looking statements based on
assumptions and estimations by the Management Board of Heidelberger
Druckmaschinen Aktiengesellschaft. Even though the Management Board
is of the opinion that those assumptions and estimations are
realistic, the actual future development and results may deviate
substantially from these forward-looking statements due to various
factors, such as changes in the macro-economic situation, in the
exchange rates, in the interest rates and in the print media
industry. Heidelberger Druckmaschinen Aktiengesellschaft gives no
warranty and does not assume liability for any damages in case the
future development and the projected results do not correspond with
the forward-looking statements contained in this press release.
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