Digital
Océ continues 'aggresive' cost-cutting as it posts 7.1% fall in revenues
Digital press manufacturer Océ has reported a 7.1% drop in quarterly revenues as the current turmoil in the world economy has "put pressures on revenues and margins".
Overall, the Netherlands-headquartered company posted a third-quarter pre-tax loss of €11.2m (£8.9m) – down from a profit of €21.2m the previous year – attributed largely to restructuring expenses incurred after the disposal of the coating activities of US subsidiary Arkwright.
Océ chairman Rokus van Iperen said the company was meeting the challenging economy through added value products and "aggressive" cost-cutting, which will take €80m out of the company's budget in 2008, and a further €50m in 2009.
He added: "The financial services and construction markets are experiencing well-publicised challenges. These developments are significantly impacting revenues from our continuous feed printers and technical document systems – the main cause of our decline in profitability."
However, the company is making progress in sales into the colour printing market, selling "several" Océ Jetstreams and "many other colour systems".
In an unusual move for a public company, van Iperen declined to provide an outlook for the company's full-year income, save that he expected a "positive free cash flow for the full year".
Oce's shares fell 2.6% in early trading on the Euronext Amsterdam.
Van Iperen: declined to give a full-year income outlook
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Comments
Colin Thompson - 01 October 2008
Oce will win this `hiccup` in the global down turn in manufactuiring.
Record Dip In UK Manufacturing
In the fifth consecutive month of contraction, levels of output, new orders and employment registered unprecedented declines.
The figures come a day after the Office of National Statistics confirmed that the UK economy failed to grow in the second quarter.
They reinforce expectations that Britain has entered its first recession since the early 1990s and boost expectations that interest rates could be cut as soon as next week.
The latest purchasing managers' index \(PMI) for the industry showed a reading of 41 - where a score below 50 indicates contraction.
It is the worst result in the 17-year history of the survey.
I expect the Bank of England's Monetary Policy Committee to take the possibility of a rate cut even more seriously after the disastrous results.
"I'm astonished by the scale of the collapse in the PMI this time around,"
"Clearly manufacturing surveys have been negative but this takes it onto a new level."
Organisations will survive like Oce if they take action immediately. Oce are a excellent example of `change management `success in action.
Colin Thompson
Cavendish
www.cavendish-mr.org.uk
Not Colin Thompson - 01 October 2008
Colin -
We've all seen the ONS stats, so no need to repeat them; more to the point, printers have been living and breathing recession in the industry for the last eighteen months or more. Welcome to the club.
p.s. I think Gordon Brown needs a bit of help with change management. Can you advise him? Or is it a lost cause now?
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