Product category:
Printing Presses and Machinery (New and Used, Service and Repair)
News Release from: KBA
Edited by the Printingtalk Editorial
Team on 14 April 2005
KBA's Quick Return To Profit And Record
Sales
German press manufacturing group Koenig and Bauer (KBA) moved back in to the black in 2004.
German press manufacturing group Koenig and Bauer (KBA) moved back in to the black in 2004 Group sales climbed 15.5 per cent to hit a record high of 1,423m Euros compared to 1,231.8m Euros in 2003
This article was originally published on Printingtalk on 12 Feb 2004 at 8.00am (UK)
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Sheetfed offset sales jumped 16 per cent to 716.2m Euros, compared with 617.5m Euros in 2003, whilst sales of web and special presses improved by 15.1 per cent to record 706.8m Euros, when 2003 saw 614.3m Euros reported.
The volume of new orders swelled by 16.2 per cent to 1,459.1m Euros over 2003 figures of 1,255.8m Euros.
The sheetfed offset division, which for the first time included a specialist manufacturer of metal-decorating presses, Bauer and Kunzi in Ditzingen (near Stuttgart, Germany) posted a 14.7 per cent improvement to 756.4m Euros, compared with 2003's performance of 659.7m Euros, while the web and special press division, which also welcomed a new addition, KBA-Metronic, ramped up bookings by 17.9 per cent to 702.7m Euros, compared with 2003's reported 596.1m Euros.
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KBA reported that despite a larger volume of shipments the group order backlog at year's end stood at 893m Euros (856.9m Euros in 2003).
The company's president and chief executive officer, Albrecht Bolza-Schunemann, said that although demand had picked up and production plants were running at a higher level of capacity, pricing pressures in the global press market showed no sign of easing.
Since exports accounted for a large proportion of group output (85.9 per cent in 2004 and 87.4 per cent in 2003), earnings were hit by the strength of the Euro, along with a big rise in steel and energy prices.
Together, those external factors partially offset internal cost savings gained from the closure of assembly plants in Kusel and Berlin (KBA-Berlin ) and staff layoffs at the group's main web press production plants in Wurzburg and Frankenthal, he added.
He added that nonetheless KBA achieved a relatively rapid return to profit following a high previous year's loss exacerbated by restructuring expenses.
Group earnings before interest and taxes totalled 20.3m Euros, compared with 2003's 46.1m Euros loss.
Pre-tax earnings were 15.9m Euros, whilst 2003 showed a 49.6m Euros loss and an annual net surplus of 11.9m Euros, compared with a 30m Euros loss in 2003.
Earnings per share stood at 0.74 Euros (-1.86 Euros in 2003).
In 2003 KBA was unable to pay a dividend for the first time since going public in 1985.
At the AGM in Wurzburg on June 23 the company's management and supervisory boards will propose resuming payment with a dividend of 25 cents per share on a total of more than 16.2 million no-par shares.
Of the company's net profit of 5.1m Euros, 4.1m Euros will be returned to shareholders and 1m Euros reinvested.
The company reported that following a big loss in the web and special web division in 2003, which wiped out profits from sheetfed offset operations, both divisions posted a pre-tax surplus in 2004.
However, unsatisfactory market pricing, coupled with expenses relating to the Drupa 2004 trade fair and an upgrade of virtually the entire product range, shrank the sheetfed operating profit to 9.8m Euros, well below the high previous year's figure of 19.9m Euros.
By contrast, the web and special press division moved from a loss of 66.9m Euros (including restructuring expenses) in 2003 to an operating profit of 10.5m Euros, with the newly consolidated subsidiary, KBA-Metronic AG, making a sizeable contribution.
Whilst expressing dissatisfaction with the level of earnings, and emphasising the group's aim of achieving a sustained improvement, Bolza-Schunemann pointed out that the group balance sheet was well able to stand comparison with that of other companies.
KBA said that instead of it shedding business divisions during the recent recession, as some of its rivals were forced to do, it had expanded in to new, high-growth applications by buying up two thriving manufacturers of metal-decorating presses (Bauer and Kunzi) and presses for printing data storage media and smart cards (KBA-Metronic).
Last month, the group stepped up its presence in the small-format sheetfed offset market with the acquisition of Czech press manufacturer Grafitec.
Future acquisitions will be in keeping with the group's core competence of press engineering, added the company.
The Koenig and Bauer payroll at year's end for 2004 totalled 5,830, roughly the same as in 2003 (5,832).
A reduction of 91 at its web press facilities was offset by an extra 89 employees - most of them in production - at its sheetfed offset plant in Radebeul.
The first-time consolidation of subsidiaries Metronic AG (290 employees) and Bauer+Kunzi (50 employees) at the end of the year added 340 to the group payroll, while in the companies already consolidated, just four additional staff were taken on, bringing the total to 7,398 (7,054 in 2003).
The consolidation of the new Czech subsidiary, KBA-Grafitec, on April 1 will raise the total by 400 people to around 7,800, added KBA.
KBA said that its investment activities focused on achieving productivity gains and permanent cost savings.
Investment in intangible assets, property, plant and equipment totalled 57m Euros, well above depreciation of 46.3m Euros.
Spending on research and development, at 54.8m Euros, was similarly high, despite cost cutting initiatives.
New press models launched at the Drupa international trade fair last year prompted a stream of new orders for sheetfed offset presses in the second half-year.
Orders for web presses were also strongly influenced by the products exhibited at Drupa for newspaper production (Cortina), commercial web offset (Compacta 217) and publication rotogravure (TR12B for a web width of 4.32m or 170") said KBA.
Those new-generation presses would account for a high proportion of shipments in 2005 and beyond, added the company.
As well as introducing some new technical features, KBA said it is driving advances in process technology.
Albrecht Bolza-Schunemann claimed that no other press manufacturer could compare with KBA on product diversity, innovation and performance.
Following its performance in 2004, KBA said that it anticipates much higher earnings in 2005, but no more than moderate growth in group sales.
The main reasons for such a sober projection are uncertainties relating to the economy, currency exchange and the cost of raw materials.
Now that the company's plant utilisation has risen, the group said it aims to focus on earnings rather than on growing market share at any price.
The first two months of the current year brought a brisk demand for sheetfed offset presses and a larger volume of new orders for web presses than at the same time the previous year, added the company.
That trend continued in March but in view of the many unpredictable external factors involved, KBA management said it will not be issuing a detailed group prognosis until a later date. Request free introductory details about products from KBA ...
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