In the first quarter of financial year 2011/2012 (April 1 to
June 30, 2011), after adjusting for exchange rate effects, sales by
Heidelberger Druckmaschinen AG (FWB: HDD) held stable compared to
the previous year and the operating result improved.
At EUR 665 million – EUR 690 million after adjusting for
exchange rate effects – incoming orders in the first quarter
2011/2012 were in line with the company’s expectations. The prior
year's higher level (EUR 786 million) was mainly due to additional
orders generated at the IPEX and ExpoPrint trade shows that took
place in the same period of the previous year. Compared to the
previous quarter (EUR 637 million), after adjustment for exchange
rate effects, incoming orders grew by 8 percent. At the end of the
first quarter of 2011/2012, the order backlog of the
Heidelberg Group amounted to EUR 718 million, up EUR 84 million on
the previous quarter.
In the first three months of the current financial year,
Heidelberg recorded sales of EUR 544 million, compared to
EUR 563 million in the same period of the previous year. Adjusted
for exchange rate effects of EUR 19 million, net sales matched the
prior-year level, but were slightly below our expectations. This is
due in part to sales being shifted into subsequent quarters as a
result of the earthquake catastrophe in Japan and delays resulting
from the extended liquidity shortage in the Chinese banking
system.
The result of operating activities excluding special
items (EBIT) for the first quarter improved over the
same period of the previous year from EUR -35 million to EUR -25
million. There were no significant special items in the quarter
under review. In the same quarter the previous year, the special
items had included income of EUR 15 million.
“In the first quarter, we were able to improve our operating
result excluding special items on the previous year while sales
remained stable,” said Heidelberg Group CEO Bernhard Schreier. “We
are keeping a close eye on current economic developments across the
globe, but it is difficult to predict what will happen. However,
given the continuing high demand and strong economic growth on the
Chinese market, we are assuming that the regional effects on
business development at Heidelberg will be only temporary.”
At EUR -22 million, the financial result in the period
under review improved over the same period of the previous year
(EUR -35 million) due to the lower financing costs resulting from
the successful refinancing measures in the first quarter. Income
before taxes improved from EUR -56 million in the same quarter
the previous year to EUR - 47 million in the first
quarter of 2011/2012. Income after taxes was EUR -46 million
(previous year: EUR -52 million).
As a result of the successful capital increase in the past
financial year and the improved operating result, the net
financial debt fell considerably from EUR 629 million in the
previous year to EUR 260 million and remained stable in comparison
to the previous quarter (EUR 247 million). Supported by consistent
cash management, free cash flow in the quarter under review
more or less balanced out at EUR -6 million despite one-off
refinancing costs.
“The significantly reduced net financial debt and our
refinancing operation concluded in spring are evidence that
Heidelberg is on a stable financial footing,” said Heidelberg CFO
Dirk Kaliebe. “We will forge ahead with our successful strategy,
particularly through consistent cost and asset management.”
The workforce fell by a further 110 in the first quarter
of 2011/2012. As at June 30, 2011, the Heidelberg Group thus had a
workforce of 15,718 worldwide (previous year: 16,218).
Business results in the divisions
In the Heidelberg Equipment Division, incoming orders in
the first quarter amounted to EUR 404 million, up 11 percent on the
previous quarter (EUR 365 million). As expected, the high figure
for the same period the previous year (EUR 501 million)
achieved as a result of high incoming orders at last year's IPEX
and ExpoPrint trade shows could not be repeated. At EUR 300
million, sales matched the level of the same quarter the previous
year. After adjustment for exchange rate effects, this is
equivalent to a rise of 5 percent. Although there was almost no
change in sales, the result of operating activities excluding
special items improved by 19 percent from EUR -48 million to EUR
-39 million.
In the Heidelberg Services Division, incoming orders
amounted to EUR 258 million, a drop of 8 percent compared to the
previous year’s figure for this period (EUR 280 million).
At EUR 241 million, net sales were also down 8 percent on the same
quarter the previous year (EUR 261 million). Despite low sales, the
operating result excluding special items amounted to EUR 10
million, matching the positive level of the same period the
previous year.
The Heidelberg Financial Services Division once again
achieved a positive operating result in the quarter under review.
At EUR 4 million, the operating result was up on the same quarter
the previous year (EUR 3 million).
Business developments in the regions
In the Europe, Middle East and Africa region, incoming
orders of EUR 245 million in the first quarter failed to match the
high level of the previous year, mainly due to the IPEX trade show
held the previous year in the United Kingdom. Incoming orders in
the Eastern Europe region of EUR 73 million were down 13
percent against the comparable quarter of the previous year. In the
North America region, incoming orders – after adjustment for
exchange rate effects – increased by 6 percent over the previous
year. In the South America region, incoming orders were 21
percent below the previous year’s figure for this period, mainly
due to the ExpoPrint trade show that took place at this time. In
the Asia/Pacific region, incoming orders were down 10
percent, but matched the prior year level after adjustment for
exchange rate effects. While net sales for the first quarter after
adjustment for exchange rate effects grew slightly in Eastern
Europe, North America, and South America, sales in Europe, Middle
East and Africa, and Asia/Pacific were either on a par or below the
previous year's levels.
Outlook
The global economic and market risks are still high and have
increased significantly overall in the last few days. The worsening
of the debt crisis in some European countries and in the United
States, coupled with the recent upheavals on the international
financial markets, could slow the pace of macroeconomic growth and
have a negative impact on investment behavior. If underlying
macroeconomic conditions and the sector as a whole remain stable,
Heidelberg nevertheless continues to strive for a break-even
pre-tax result in financial year 2011/2012 – based on a higher
operating result and lower financing expenses.
The global printing volume remains stable and will require
investments in production equipment. Based on this, Heidelberg
intends to achieve a medium-term sales target of over € 3 billion
annually over the next two to three years.
Assuming that the economic environment will continue to be
generally stable, Heidelberg expects to gradually approach this
target during the current and next financial year. Due to drupa
2012 and the ongoing upswing in the print media industry, sales in
the next year should grow more strongly than during the current
financial year.
Additional details on the company can be found at
www.heidelberg.com.
Other dates:
The figures for the second quarter of financial year 2011/2012
are due to be published on November 8, 2011.
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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