The cuts are part of a four-tier strategy by the press giant to save €100m (£80m) by the 2010/2011 financial year – €75m of which is expected in the next 18 months.

For the first quarter, the manufacturer has pitched preliminary sales for the 2008/2009 period between €640m (£510m) and €660m – a slump from €742m in the previous year.

In addition, the group is expecting an operating loss of up to €40m compared with a profit of €26m for the same quarter of the prior year.

Heidelberg has cited the rapidly increasing prices of raw materials, such as steel and energy, coupled with "problematic exchange rate movements", as contributing factors towards the results.

Its free cash flow is also expected to be considerably lower than the previous year, between -€200m and -€220m (-€81m in 2007/2008), following the acquisition of Hi-Tech Coatings in May for an undisclosed sum.

With 500 positions from a workforce of nearly 20,000 to be shed worldwide by the end of the 2010/2011 financial year, the company also plans to hike its purchasing and production activities outside the Euro zone, increasing its spend from €40m to €200m.

The firm is eyeing an expansion of its Chinese and Slovakian plants with production of small-format presses intended to move to the US, in a bid to achieve savings of around €15m.

Heidelberg plans to reduce its R&D expenditure by consolidating current locations and pooling its development activities with a view to lower its research spend by 10%.

Over the next three years, the company will also undergo a restructuring of its post-press packaging business by consolidating production capacities and moving specific processes to its Slovakian operation.

The company has, however, recorded an increase on its incoming orders, which amounts to between €1.1bn and €1.15bn, up from €934m the previous year.

Heidelberg claims this is thanks to, in part, a good showing at Drupa, but the manufacturer would not be drawn on providing a forecast for 2008/2009 figures as a whole.

George Clarke, managing director of Heidelberg UK, said: "To stay competitive you have to continually re-examine what you're doing.

"We're healthy, but we have to stay that way. And that's the challenge."