By Jo Francis, Thursday 21 March 2019
Koenig & Bauer has said that orders for new presses have “largely shrugged off the effects of recent political and economical developments”, as the group posted its highest EBIT figure in more than 200 years of trading.
The Germany-headquartered press manufacturer had been held back by issues around the availability of parts last year, particularly at its largest unit the Sheetfed division, where sales slipped by 2% to €647.4m, but despite this also having a dampening effect on new business, the group still managed to post sales for calendar year 2018 that were slightly up at €1.23bn (£1.07bn).
Earnings before interest and taxes (EBIT) reached €87.4m (2017: €81.4m) the highest level ever at the company, which celebrated 200 years in business in 2017. However, a higher tax bill resulted in net profits falling from €81.1m to €64m.
Chief executive Claus Bolza-Schünemann described the firm’s advances in packaging printing as “particularly gratifying” and pointed to a number of highlights, including Koenig & Bauer growing its share of the flexible packaging market to 9%, and delivering substantial growth in coding and marking, and at the Duran folder-gluer business acquired last year.
The firm also said it had made “pleasing gains” in large-format presses for carton printing, where it claims a 45% share of the overall market.
The revamped version of the B1 VariJet sheetfed inkjet press for carton printing – now being developed with joint venture partner Durst instead of original partner Xerox – is set to be shown at Drupa 2020. And K&B’s Digital & Web division reported a 20% jump in orders, although sales were slightly lower at €150.7m “due to fewer installations of HP presses”. “Market entry and growth-related expenses” saw losses at the division more than double to €10.5m (2017 loss: €4.3m).
Packaging giant Tetra Pak has ordered a large-format RotaJet digital press in world-first for the production of digitally-printed beverage cartons, and K&B said it had received two further orders for the press for digital décor printing.
Revenues at the Special presses division increased from €467.9m to €490.5m on the back of sales for security printing, coding systems, and presses for hollow container decoration.
Overall order backlog increased to €610.9m at the end of last year, and Bolza-Schünemann said that “good order development in January and February gives us good forward visibility across the entire group until the summer.”
“The printing production output of our customers all around the world is growing, especially in the packaging segment,” he stated.
“With the exception of packaging printers in China producing for export markets, our order intakes has so far largely shrugged off the effects of the recent political and economic developments.”
K&B has laid out its strategic imperatives for this year, including a sales focus on new and enhanced products; measures to reduce costs and lead times, and increase productivity; an initiative to strengthen the quality of the group’s leadership; plans to achieve a more even distribution of sales across the year; and expanding service revenues to 30% of sales.
The firm had already outlined plans for a €50m investment in an “additional growth offensive” programme in the medium term. “With all our initiatives and projects, we are targeting to increase group revenue to around €1.5bn with an EBIT margin of between 7% and 10% until 2023,” Schünemann stated.
Share in K&B slipped by 6.3% to €42.82 on the news.