KBA Reveals Q1 2014 Results

In the first quarter of 2014, Koenig & Bauer (KBA) delivered a double-digit increase in sales and order intake, as well as significant improvements to its operating and pre-tax results year-over-year. At €241.5 million, group order intake rose by 20.8%. New orders of sheetfed offset presses were up 10.3% to €146.5 million (2013: €132.8 million), while order intake of web and special presses increased by 41.4% to €95 million (previous year: €67.2 million).

Demand for web offset presses remained subdued, and along with order backlog, it strained sales and earnings. Group sales of €213.4 million after three months was 11.9% higher than the prior-year figure of €190.7 million. Postponed special press deliveries on the customers’ side led to only a slight climb in web and special press sales from €92.5 million in 2013 to €94.7 million, whereas the sheetfed division generated a 20.9% rise in revenue to €118.7 million.

The group’s book-to-bill ratio was positive after the first three months of 2014 and order backlog stood at €588.6 million at the end of the quarter.

A slide of nearly 20% in domestic sales primarily a result of fewer web press deliveries raised the export level from 71.2% to 79.3% year-over-year. Shipments to the rest of Europe contributed 31% to group sales (2013: 29.8%). Indications that demand is gradually picking up can be seen predominantly in the south of Europe. The proportion of the group total attributable to Asia and the Pacific jumped from 23.2% to 30.4% and North America’s contribution grew from 10.9% to 11.4%. However, weak currencies in countries like Brazil and South Africa helped push the regional total in Latin America and Africa down from 7.3% the year before to 6.5%.

The gross profit margin widened from 21.3% 12 months earlier to 25.4%. KBA posted an operating loss due to sales, but at –€10.2 million, this was an improvement on the prior-year figure of –€16.9 million.

According to KBA president and CEO Claus Bolza-Schünemann, the implementation of Fit@All for the restructuring of the KBA group “made good progress” in the first quarter of 2014. The program was approved in 2013 and will be in force until 2016. Cancellation and phased retirement agreements, social wage agreements and social compensation plans were agreed for around 700 employees at various locations as part of the planned group-wide reduction of 1,000 to 1,500 jobs by the end of 2015.

Along with adapting capacities to shrunken market segments, the realignment of KBA focuses more strongly on growth markets, such as packaging printing. In this context Bolza-Schünemann refers to KBA-Kammann for the direct decoration of glass and KBA-Flexotecnica active in the prosperous flexible packaging segment. The integration of these two subsidiaries which joined the group in 2013 “is well underway.”