COVID-19 considerably hits Heidelberg FY 2019/20 figures

Heidelberg has reported that its financial year 2019/20 (April 1, 2019 to March 31, 2020) has been impacted by the increasingly deteriorating economic environment caused by the COVID-19 pandemic.

Based on preliminary figures yet to be audited, it said that its group sales amounted to almost €2.35 billion, some six per cent lower than the previous year.

According to the company, restrained investment activity caused by the economic circumstances following COVID-19 had a negative impact on business, first and foremost in Europe.

It added that during the fourth quarter, macroeconomic conditions worsened considerably and unexpectedly due to the COVID-19 pandemic and this was reflected in its sales, which at €659 million was significantly lower than in the same quarter of the previous year (€797 million).

Heidelberg’s preliminary operating result (EBITDA) excluding the effects of restructuring was €102 million, down from the €180 million in the previous year.

EBITDA margin excluding the effects of restructuring was at 4.3 per cent, below the previous year’s figure of 7.2 per cent due to volume and product mix effects.

The non-recurring expenditure for the company’s realignment (€275 million) further impacted the result for the financial year under review and its provisional net result after taxes was a loss of € 343 million, down from € 21 million the previous year.

“Financial year 2019/20 was shaped by a significant downturn in the global economic climate, and that affected our customers and Heidelberg itself, too,” Heidelberg CEO Rainer Hundsdörfer said.

“Through our package of measures which we have announced in March, we have paved the way for Heidelberg to achieve stability, improve our liquidity and increase profitability step by step for the long-term.

“The COVID-19 pandemic poses significant challenges for Heidelberg and the entire industry, which we will master alongside our customers and using what Heidelberg has to offer as a technology leader in the printing industry. By joining forces, we will emerge stronger from the crisis.”

To counteract the downturn in underlying conditions over the year and increase financial stability, Heidelberg introduced a number of measures in mid-March 2020. This included ending the production of Primefire and large-format presses and the planned reduction in personnel, as well as increasing its liquidity and reducing its net debt.

“This considerable improvement in our liquidity gives us essential room for manoeuvre in these difficult times,” Heidelberg chief financial officer Marcus A. Wassenberg said.

“Heidelberg is going to implement the announced measures consistently and quickly. We are all aware that the cuts are a significant blow, particularly in the current situation. However, they are absolutely essential to safeguarding the future of Heidelberg.”

The company is expected to publish its financial statements and its annual report for 2019/20 on June 9.

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