Strong showing from K&B as specialist presses take off

Koenig & Bauer is working “intensively” on new products for the packaging, digital and industrial printing markets, after filing a strong set of results for its latest financial year.

The German manufacturer, which celebrated its 200th anniversary last year, reported sales up 4.3% to €1.218bn (£1.07bn) for the year to 31 December 2017.

The firm said it had met or exceeded its financial targets, as well as growing market share. EBIT (earnings before interest and taxes) grew from €62.9m to €81.4m, with margins up to 6.7%, which was above the figure expected.

Sales at the Sheetfed division, K&B’s largest business unit, were up 7.3% to €660.2m, while order intake jumped 15.2% to €656.2m.

Chief executive Claus Bolza-Schünemann said that a “sharp rise” in order for K&B’s new flatbed die-cutters had “exceeded our expectations substantially”.

EBIT margins in Sheetfed increased from 5.1% to 5.7%, and the division was also boosted by orders for bespoke presses for commercial and packaging printing.

At K&B’s Special presses division, which includes presses for security printing, metal decoration, and for printing onto hollow containers, sales were up 5.3% to €444.3m while order intake grew by 16.1% to €533.7m.

The Digital & Web division disappointed, with order intake slumping by 23.3% to €139.6m, and sales down 16% at €154.2m, which K&B said was mainly a result of the ongoing decline in orders for newspaper and commercial web offset presses. K&B has also invested heavily in developing a new offering for flexible packaging which is yet to come to fruition.

Chief financial officer Mathias Dåhn said: “With the measures taken in flexible packaging printing, a turnaround is apparent, although it will be important to continue to take the right actions to close the gap between our company and the successful leaders of this attractive market.”

K&B also said that the group-wide service initiative launched in 2016 had seen revenues from that area of operations increase from 23.5% to 25.6% of overall sales.

“We want to create satisfied and loyal customers by offering excellent service. At the same time, rising service revenue is an important measure of customer satisfaction for us,” Dåhn added.

Looking to the future, Bolza-Schünemann said K&B expected to capture a bigger chunk of the booming market for corrugated board printing.

It will install its first CorruCut, a sheetfed flexo press with integrated cutter, at pilot site Klingele Group in Delmenhorst north-west Germany early next year; while the new digital sheetfed press for corrugated, the CorruJet, is currently being tested prior to being delivered to first customer, Bavarian corrugated packaging specialist Hans Kolb Wellpappe.

Two orders have also been signed for its new CS MetalCan press for direct printing onto two-piece cans, which will now undergo field-testing with an official sales launch targeted for the end of this year.

K&B has announced a 3.7% increase in the prices of its products across the board, in response to rising input costs. This is effective from 1 April.

The group’s share price hit a 52-week high of €74.30 earlier this month but had slipped back to €71.75 at the time of writing.

K&B said it was targeting an EBIT margin of 9% and organic sales growth of around 4% by 2021.


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