A big increase in orders for special presses has boosted first-half results at Koenig & Bauer, with the order backlog at the manufacturer ‘extraordinarily high’ at more than €800m (£712m).
Although overall sales in the period to 30 June slipped by 4.5% to €514.4m, order intake was up 17.2% to €705.3m and the order backlog jumped by almost 30% to €805.8m.
K&B said it was on track to meet its targets for 2018, on the back of a massive 52.8% rise in orders for presses in its Special division, to €330.6m, including security printing and marking and coding. The order backlog for special presses was up 64.2%, to €468.3m.
In the Sheetfed business, K&B’s biggest division, sales declined by 8.1% to €283m and order intake was flat at €326.3m, although the prior year figure had been boosted by Print China orders. K&B described the performance of the division as “strong”, with chief executive Claus Bolza-Schünemann citing “substantial growth” in large-format sheetfed presses for packaging.
“As the world market leader in folding carton printing, we are benefiting from heightened capital spending of the international packaging printers,” he stated.
New products for the folding carton market include the Ipress 106 K Pro flatbed die-cutter, which uses the same feeder as the Rapida sheetfed presses.
At the Digital & Web division sales were down 18.3% at €55.8m, while order intake was more largely unchanged at €84.7m and the order backlog was down 3.4% at €90.4m. Chief financial officer Mathias Dähn cited subdued demand for digital presses, but pointed to “significantly greater” potential in the short- and medium-term for large corrugated and flexible packaging presses. Demand for newspaper presses and services was also down.
Group EBIT (earnings before interest and taxes) fell from €16.3m to €10.6m, due in part to the build-up of orders that won’t be delivered until H2. Losses at the Digital & Web division also increased from €2.8m to €9.1m.
Dähn said the group now had to work hard to meet the challenge of successfully fulfilling a large number of orders in the second half, particularly Q4.
“This is a challenging task to which we pay particular attention,” he said.
K&B’s board said the business expected to achieve organic growth of around 4% this year, and an EBIT margin in the region of 7%.
The group-wide service initiative and cost-cutting projects in its security printing wing and in purchasing and production should result in a €70m increase in earnings.