Helge Hansen, chief executive KBA, said, “Last year’s growth rates were high partly because they followed exceptionally poor prior-year figures, and are therefore unlikely to be repeated on this scale. For 2011 we are targeting a moderate increase in sales and earnings, with both divisions contributing their share.”
The company posted a financial loss of €6.9m (2009: a loss of €6m), but boosted group pre-tax profit from €2.7m in 2009 to €15.3m. Net profit of €12.5m rose above the prior-year figure of €6.6m and equates to earnings per share of 76 cents. Following a two-year hiatus in dividend payments the management and supervisory boards will table a motion at the AGM on June proposing a dividend of 30 cents per share for the 2010 business year.
KBA reports that a brisker demand following a revival in the spring drove the group order intake up to €1,284.9m, a 45.4 per cent improvement on the crisis-shaken previous year. Orders for sheetfed offset presses jumped 33.8 per cent to €621.6m, while those for web and special presses rose 58.2 per cent to €663.3m. The group order backlog at the end of December was up 31.6 per cent at €440.8m. KBA attributes the growth rates to its broad product range, which addresses volume markets like commercial, packaging and newspaper printing, and niche markets such as metal decorating, coding and security printing.
It adds that a double-digit jump in revenue, and the cost savings delivered by consolidation, enabled it to more than double its operating profit from €8.7m to €22.2m. Benefiting from firmer sales and the reduced cost base accruing from restructuring measures, the sheetfed division converted a €23.1m operating loss the previous year into an €8.2m profit. Provided global economic growth in 2011 is not seriously impaired by current developments, KBA has confidence that the higher order backlog at the start of the year and initial brisk demand will enable it to maintain this upward trajectory in sales and profits. The company adds that a decline in operating profit generated by web and special presses, from €31.8m in 2009 to €14m, reflected more acutely than in the previous year the plunge in demand for web presses: the backlog of orders from better years, which helped sustain figures in 2008 and 2009, was no longer there to cushion the impact of unsatisfactory profit margins in a buyers’ market and the poor level of capacity utilisation at the production plants concerned.
KBA says it has weathered the economic crisis, media transitions and a cost-intensive realignment to a smaller market volume without drawing on external financing or injections of capital, adding that a net profit for the year, foreign currency translations and the issue of employee shares raised equity at the end of last year by €41.5m to €461.3m, with an equity ratio of 39.6 per cent relative to a €100m higher balance sheet total. It also claims to have access to additional cash credit lines for more than €100m from banks.
For the first time, sales in Asia and the Pacific have overtaken Europe as the company’s export level hit an historic high of 88.5 per cent. While the proportion of group sales generated in Europe (excluding Germany) dropped to 28.5 per cent, well below the historic average of 50 per cent plus. Sales to Asia and the Pacific 29.4 per cent of the total and KBA says that brisk demand in China for sheetfed presses was a major contributory factor.
At the end of the year the Group workforce totalled 6,419, down 550 from the same time the previous year and 1,700 fewer than before the GFC, and,when consolidation is complete, the group payroll will be approximately 25 per cent smaller than before.
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