The board has proposed a dividend of 30 cents per share and is targetting moderate growth in sales and earnings this year.
KBA has announced this month it will expand its product range to address the digital print market.
Brisker demand following a revival in the northern spring drove the group order intake up to 1.29 billion Euros, a 45.4 per cent improvement on the crisis-shaken previous year. Orders for web and special presses soared 58.2 per cent to 663.3 million Euros. KBA says above-average growth rates were partly attributable to its broad product range.
Even though the web and special press division started the year with a much smaller backlog of unfilled orders, and competition from online media impacted on demand for big newspaper presses, it posted a 9.8 per cent increase in sales to 628 million Euros. Demand for multi-unit web presses picked up in the second half-year but remained well below pre-crisis levels. Most of the orders booked for newspaper presses, where KBA says it is the market leader, came from Europe.
The decline in operating profit generated by web and special presses, from 31.8 million Euros in 2009 to 14 million Euros, 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, the maker says.
KBA posted a financial loss of 6.9 million Euros (2009: a loss of 6 million Euros), but boosted group pre-tax profit from 2.7 million Euros in 2009 to 15.3 million Euros. Net profit of 12.5 million Euros was also well above the prior-year figure of 6.6 million Euros 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 June 16 annual meeting proposing a dividend of 30 cents per share for the 2010 business year.
KBA reports that cash flows from operating activities of 30.1 million Euros were roughly on a par with the previous year (29.6 million Euros), while the free cash flow surged from 4.9 million Euros in 2009 to 20.4 million Euros. With liquid assets totalling 91 million Euros and bank loans reduced from 48.3 million Euros to 43.1 million Euros, KBA’s net financial position, at 47.9 million Euros, was much stronger than the year before (27.8 million Euros).
KBA says that “unlike many other players in this sector_, 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.
A net profit for the year, foreign currency translations and the issue of employee shares raised equity at the end of last year by 41.5 million Euros to 461.3 million Euros. An above-average equity ratio of 39.6 per cent relative to a 100 million Euros higher balance sheet total underscores the solid financial structure of the world’s oldest press manufacturer. The company has access to additional cash credit lines for more than 100 million Euros from banks.
Cost-cutting initiatives notwithstanding, last year investment in research and development exceeded four per cent of total group sales. At the end of the year the Wall Street Journal’s Patent Scorecard for heavy industrial equipment in the USA ranked KBA twenty-fourth.
Exports are now nudging 90 per cent with Asia and the Pacific overtaking Europe.
For the first time in KBA’s 194-year history, sales to the rest of Europe (excluding Germany), its biggest market, were surpassed by sales to Asia and the Pacific, which accounted for 29.4 per cent of the total.
Brisk demand in China for sheetfed presses was a major contributory factor. This shift in demand towards the Far East is seen throughout the German engineering industry.
Despite a perceptible lift in sales of batch-produced presses in North America, slack demand for newspaper web presses caused the proportion of the group total generated in this region to slide from 13.9 per cent to ten per cent. However, sales to the threshold markets of Latin America and Africa soared, pushing up the regional total from 12.1 per cent in 2009 to 20.6 per cent.
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 crisis. The payroll cuts necessitated by diminishing market and sales volumes were implemented in a socially responsible manner to minimise the impact on employees. When consolidation is complete the group payroll will be approximately a quarter smaller than before. Even so, the group continues to invest heavily in staff training and qualifications. The training ratio rose from 5.8 per cent in 2009 to 6.5 per cent.
Assessing the prospects for 2011, KBA chief executive Helge Hansen noted that the recent events in North Africa and Japan, the unresolved debt crisis in Europe, soaring prices for energy and raw materials and inflationary pressures in China have raised the level of risk to which exporters are exposed. Nonetheless he is confident that the upturn in group sales and earnings over the past two years can be maintained in 2011.
“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,” he said. “For 2011 we are targeting a moderate increase in sales and earnings, with both divisions contributing their share.”
Koenig & Bauer Group |
31.12.2009 in €m |
31.12.2010 in €m |
Change In % |
|
Order intake Web and special presses Sheetfed offset presses |
883.9 419.3 464.6 |
1,284.9 663.3 621.6 |
+45.5 +58.2 +33.8 |
|
Sales Web and special presses Sheetfed offset presses |
1,050.4 571.7 478.7 |
1,179.1 628.0 551.1 |
+12.3 +9.8 +15.1 |
|
Order backlog Web and special presses Sheetfed offset presses |
335.0 242.8 92.2 |
440.8 278.1 162.7 |
+31.6 +14.5 +76.5 |
|
Operating profit |
8.7 |
22.2 |
- |
|
Earnings before taxes (EBT) |
2.7 |
15.3 |
- |
|
Net profit for the year |
6.6 |
12.5 |
- |
|
Earnings per share in € |
0.41 |
0.76 |
- |
|
Cash flow from operating activities |
29.6 |
30.1 |
- |
|
Balance sheet total |
1,060.4 |
1,164.4 |
- |
|
Equity |
419.8 |
461.3 |
- |
|
Dividend in € |
- |
0.30 |
- |
|
Payroll on 31.12. |
6,969 |
6,419 |
- |