Koenig & Bauer profit down

Press giant Koenig & Bauer AG has seen its net profit more than halve for the first half of 2018, along with generating sales of €514.4m, dropping five per cent from €538.9m for the prior corresponding period (pcp).

Earnings before interest and taxes (EBIT) came in at €10.6m, falling 35 per cent from €16.3m in the first half of 2017. Net profit was booked at €6.7m, decreasing 56 per cent from €15.2 in the pcp.

Order intake reached €705.3m, increasing by 17.2 per cent from €601.9m in the pcp.

While other regions dropped in revenue, except for Germany, which the company classifies as apart from the rest of Europe, the Asia/Pacific area grew, increasing to 27.1 per cent of the group’s revenue, from 24.6 per cent the year before. The rest of Europe excluding Germany remained the highest source of income, although it dropped, making 33.8 per cent of the company’s total revenue in the half from 35.7 per cent the year before.  

The Australian division is also changing its name, going from KBA Australasia to Koenig & Bauer (AU).

Earnings per share dropped 41 per cent, clocking in at €0.39 for the half from €0.93 the year before.

Claus Bolza-Schünemann, CEO of KBA, says, “With order intake reaching a particularly high €454.4m in the second quarter and the order backlog rising to €805.8m at the end of the first half, the Koenig & Bauer Group is on track to meet its targets for 2018. This year, we expect to achieve organic growth of around 4 per cent in Group revenue and an EBIT margin of around 7 per cent.

“Strong security business and more orders in packaging printing caused order intake to rise by 17.2 per cent to €705.3m in the first half of 2018. Driven by the good Q2 figure of €297.1m, Group revenue came to €514.4m, but fell short of the previous year’s figure of €538.9m due to the even greater accumulation of delivery dates in the second half of the year.”

The Sheetfed segment reached a revenue of €283m for the half, down 8.1 per cent from €307.8m in the pcp. The sector’s EBIT of €7.7m saw a 37 per cent decrease from the year before.

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Digital & Web saw its revenue decline by 19 per cent  to €55.8m in H1 from €68.3m the year before, with its EBIT coming in at -€9.1m for the half, compared with -€2.8m in the pcp.

Contrarily, the Special segment saw its revenue rise to €195m, up 3 per cent from €189.2m in the pcp, while EBIT came to €14.4m, down 2 per cent from €14.6m.

Bolza-Schünemann says, “Order intake in our sheetfed segment exactly matched the previous year’s good figure influenced by the Print China fair. Substantial growth was achieved in large-format cardboard printing. As the world market leader in folding carton printing, we are benefiting from heightened capital spending of the international packaging printers. EBIT was down on the previous year due to the delivery related decline in revenue.

“Despite the progress in flexible packaging printing, new orders in Digital & Web were slightly down on the previous year due to fewer orders for newspaper web presses and services. In addition to the growing market-entry costs particularly for corrugated and flexible packaging, EBIT was significantly burdened by lower revenue.This was materially due to the decline in revenue from digital printing presses as a result of subdued demand.

“We are concentrating on digital printing applications for packaging and industrial printing offering our customers a sustained business model for smaller print runs, greater format flexibility and heightened personalisation. However, we see significantly greater short and medium-term potential in the large corrugated and foil printing markets, which are expanding at above-average rates. We want to accelerate the pace of growth in analogue direct printing on corrugated board. This also applies to flexible packaging printing following the successful realignment of this business.”

In its outlook, KBA expects organic growth of arouth 4 per cent in its Group revenue and an BIT margin of about 7 per cent for the full year.

Bolza-Schünemann says, “In addition to our printing, finishing, coding and postpress solutions for cardboard, banknotes, cans, glass and hollow containers and other products, we are particularly focusing on corrugated board and flexible packaging. With the focus on the growing packaging printing, we want to boost our revenue and profitability as well as the stability of our business on a sustained basis.”

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