K&B reaffirms financial targets

Koenig & Bauer has reaffirmed that it is on track to meet its sales and profit targets for this year in the light of last week’s trading outlook warning from arch-rival Heidelberg.

In a statement, the manufacturer said that it had “carefully noted and analysed the recent ad hoc releases issued by its competitors”, but on the basis of its first-half business performance was sticking by its revenue and earnings forecasts for the current year.

K&B had sales of €1.23bn (£1.1bn) last year, and posted the highest EBIT in the firm’s 201-year history. In March it said it was targeting an increase in group revenue to around €1.5bn with an EBIT margin of between 7% and 10% for the next five years.

Bobst has also posted a drop in sales for the first half of the year, and downgraded its full-year profits guidance.

“Particular focus is being placed on active cost structuring while continuing work on innovative products which enable customers to realise tangible added value,” K&B stated. A spokesman said the cost actions would involve ongoing efforts to optimise its procurement and production network.

Last week Heidelberg downgraded its profit expectations and revised its forecasts.  

K&B also said that, for legal reasons, it was highlighting proceedings initiated by the Brazilian government against its Swiss banknote printing equipment subsidiary KBA-NotaSys, which is headquartered in Switzerland.

Brazil’s Comptroller General of the Union has begun proceedings under operation Vices II, which was conducted by the Federal Police. “The investigation found money laundering and former directors of the Brazilian Mint to favour KBA-NotaSys in exchange for advantages during the bidding process for the acquisition of about R$301m in equipment,” the notification stated.

The equivalent value in pounds sterling is just over £64m.

The process could result in a fine and KBA NotaSys being barred from future public contracts.

K&B said KBA NotaSys had not yet received formal notification of the action, but based on the current information available it would not have a material effect on the group’s profits or finances.

“The situation in Brazil was already part of the legally completed self-disclosure proceedings which the Swiss subsidiary initiated at the Swiss Office of the Attorney General regarding shortcomings in corruption prevention,” K&B said, with disclosures already made in 2017 and at the manufacturer’s AGM in May this year.

K&B will release its Q2 results on 1 August.


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