Heidelberg Publishes Half-Yearly Figures, Program Being Developed to Ensure Earnings Targets Are Achieved

In the first six months of financial year 2011/2012 (April 1 to September 30, 2011), Heidelberger Druckmaschinen AG (Heidelberg) significantly improved its operating result while recording stable sales.

Incoming orders for the first half-year totaled EUR 1.333 billion. After adjustment for exchange rate effects, this was around 5 percent below the high level for the same period the previous year (EUR 1.436 billion), which was influenced by the IPEX and ExpoPrint trade shows. The Heidelberg Group’s order backlog at the end of the second quarter amounted to EUR 731 million, which was slightly higher than the previous quarter (EUR 718 million).

Sales for the first six months totaled EUR 1.180 billion (EUR 1.209 billion after adjustment for exchange rate effects), which was on a par with the previous year’s level of EUR 1.196 billion.

Over the same period, the operating result excluding special items improved significantly to EUR -21 million (previous year: EUR -41 million). Amounting to EUR 3 million, the special items mainly consisted of personnel-related expenditure. In the previous year, special items yielded an income of EUR 22 million.

“With stable sales, the continued consistent cost management that forms part of the reorganization and the associated efficiency gains have led to a significant improvement in profitability compared to the previous year. To achieve our medium-term earnings target, we will take action to counter the fact that the global economic situation has become more uncertain and the market is not recovering as expected,” said Heidelberg Group CEO Bernhard Schreier.

At EUR -42 million, the financial result was clearly improved against the previous year’s figure of EUR -87 million. The pre-tax result for the second quarter improved from EUR -50 million in the previous year to EUR -19 million. The result for the half-year under review improved substantially from EUR -106 million in the previous year to EUR -66 million. Heidelberg achieved a net result for the first six months of EUR -66 million (previous year: EUR -88 million).

The free cash flow for the first half-year was negative at EUR -19 million. This was partly due to the outflow of funds resulting from the plant expansion in China. The net financial debt for the first six months was comparatively low at EUR 279 million. At the beginning of the previous financial year, this debt was still as high as EUR 695 million. The equity ratio remained stable at around 30 percent during the period under review.

“Successful refinancing and effective asset management enabled us to secure the company’s financial stability and thereby significantly reduce our financing costs. Thanks to the further optimization of net working capital in the second quarter, the free cash flow was better than expected, which had a positive impact on our net debt,” said Heidelberg CFO Dirk Kaliebe.

As at September 30, 2011, Heidelberg had a workforce of 15,782 worldwide (previous year: 16,228). The number of employees thus fell by 446 compared to the previous year.

Business results in the divisions and regions

In the Heidelberg Equipment division, incoming orders for the first half-year totaled EUR 810 million. This was 8 percent down on the previous year, which was boosted by the IPEX and ExpoPrint trade shows. Over the same period, the division saw sales grow by 4 percent (7 percent after adjustment for exchange rate effects) to EUR 674 million. The Heidelberg Services division was still feeling the effects of the declining business with remarketed equipment. Incoming orders were 7 percent below the previous year’s figure at EUR 515 million. The division’s half-yearly sales fell by 7 percent (6 percent after adjustment for exchange rate effects) to EUR 498 million.