Heidelberg Well on Track After Solid 2Q 2023-2024

Despite the difficult global economic situation, Heidelberger Druckmaschinen AG is well on track after six months of the financial year 2023/2024. This is the result of a slight improvement in sales in the key EMEA region thanks to growth in the packaging segment.

After adjustment for exchange rate movements, the technology company achieved sales of €1.092 billion in the first half-year (April 1 – Sept. 30, 2023), which matched the previous year (€1.120 billion). Incoming orders after six months totaled €1.184 billion after adjustment for exchange rate movements, which was also equivalent to the previous year’s level (€1.229 billion).

The adjusted operating result (EBITDA) was an improvement on the same period of the previous year, with the half-year figure amounting to €101 million (adjusted result for previous year: €92 million). The corresponding adjusted EBITDA margin increased to 9.2% (previous year: 8.2%).

Packaging and label printing is experiencing structural growth due to burgeoning worldwide demand for packaged goods. That being the case, the market launch of new technologies from Heidelberg for this growth segment was a big success.

For example, the Gallus One digital label press impressed at the major industry trade show Labelexpo and attracted a great deal of interest from customers. The Boardmaster press for high productivity in packaging printing also generated further sales. In parallel with this, incoming orders for the Packaging Solutions segment saw a significant increase of around 16% in the first half-year.

“Given the stable growth of packaging printing, we are continuously further expanding our portfolio in this sector,” said Heidelberg CEO Dr. Ludwin Monz.

The cash generated from operating activities (operating cash flow) improved substantially, in particular due to rigorous management of inventories and receivables (working capital). Despite this positive development, the free cash flow of €–28 million after six months was down on the previous year’s level (€–13 million), which had included special items amounting to around €52 million.

“The current free cash flow situation underlines the necessity to use further impetus from our value creation program to generate resources for growth in segments such as the lucrative digital printing sector,” says CFO Tania von der Goltz.

Assuming the global economy does not see weaker growth than predicted by the economic research institutions, the company is still expecting sales in financial year 2023/2024 to match the previous year’s figure (€2.435 billion). The adjusted EBITDA margin is also anticipated to remain at the previous year’s level (7.2%).