KBA orders grow, profit dips

KBA orders grow, profit dips
More orders due to growth in digital printing and packaging, commercial sheetfed grows

Press giant Koenig & Bauer saw its third quarter order intake rise 3.9 per cent from €869.8m to €903.4m, however its profit dipped from €32.5m in 2016 to €29.5m.

Its revenue rose by two per cent to €847.7m, with the book-to-bill ratio of 1.07, the order backlog of €613.2m at the end of the quarter remained at the previous year’s high level. EBIT came to €36.4m, down from last year’s figure of €39.2m. This figure had been influenced by a catch-up effect of €4.9m from a security press project.

Mathias Dähn, CFO at KBA says, “In addition to our expanding service business, the increase in new orders was underpinned by gains in the growth fields of packaging and digital printing.”

Claus Bolza-Schünemann CEO KBA reported on a first order for the newly developed digital inkjet CorruJET sheetfed press addressing the prospering market of corrugated printing, which the company says attracted great customer interest at the trade event Fefcor.

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Bolza-Schünemann says, “The numerous press deliveries and service orders in the fourth quarter will trigger a surge in revenue and earnings. In view of this business concentration, which is challenging due to the high capacity utilisation but not unusual, we expect an organic growth of up to €1.25bn in group revenue and an EBIT margin of around 6 per cent in 2017.”  

Following a good third quarter, the Koenig & Bauer group took a large step towards achieving its growth targets for revenue and earnings in 2017, the year in which it was celebrating its 200th anniversary. In the first nine months, order intake rose by 3.9 per cent over the previous year

Order intake in the sheetfed segment rose by 11.7 per cent from €429.8m to €480.3m. In addition to the clear increase in service orders, this performance was underpinned by strong demand in the packaging sector and orders for commercial sheetfed presses and flatbed die-cutters. Revenue in the sheetfed segment grew by 7 per cent from €443.8m in the previous year to €474.7m. The additional revenue with a service business and lower costs resulted in an increase in segment profit to €20.3m compared to €17.3m from last year.  

Following the two per cent increase in revenue in the year to 30 September 2017 and the good earnings in the third quarter, the management board’s guidance for 2017 is based on the high order backlog of €613m.

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Order intake in the Digital & Web segment dropped to €111.1m compared with €128.5m in the previous year particularly as a result of fewer new contracts for web offset presses for newspaper and commercial printing. Reflecting this, revenue came to €113.2m, down 8.8 per cent on the previous year (€124.1m) despite the growth in service business and digital printing presses. The positive earnings trend in web offset and digital printing business came under strain from optimisation efforts at KBA-Flexotecnica, resulting in segment EBIT of minus €3.6m compared with the previous year’s figure of minus €1.9m.  

In the Special segment, growth in orders for metal, glass/hollow container decorating and coding systems together with a slight shortfall in security printing business over the previous year’s high level resulted in an increase in new orders from €355.3m to €359.8m. At €304.6m, revenue still fell short of the previous year (€323.6m). EBIT came to €25.6m in the first nine months (2016: €29.6m). The segment posted an EBIT margin of 8.4 per cent.  

The group workforce increased by 210 over the previous year to 5,542 employees as of 30 September. In addition to recruiting in the service business and for new applications for the packaging and digital printing markets, 44 employees joined the group as a result of the first-time consolidation of KBA CEE.  

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