Heidelberg has released its final figures for its third quarter, which ended 31 December 2019 and broadly show the company slowly turning around as it continues to transform away from its reliance on selling offset presses into offering a more rounded range of digital services.
Thus the incoming orders are up from last year’s Q3 figure of €606 million to €636m. However, the net sales fell from €579m to €567m this quarter, which the company puts down to the reluctance to invest in Europe caused by the economic situation.
The Earnings Before Interest, Tax, Depreciation and Amortisation, or EBITDA, for the third quarter, and excluding restructuring costs, was € 47 million up from € 39 million in the same quarter of the previous year. However, this is largely down to a one-off € 25 million from the sale of Hi-Tech Coatings and Heidelberg pointed out that lower volumes, pressure on margins in the consumables trading business and regional shifts with a less favorable product mix as well as high up-front expenditures in digital printing all hit earnings despite the company’s cost-cutting program.
That said, Heidelberg says that it is getting closer to its goal of increasing the share of recurring revenues from subscription offers to around one-third in the medium term. By the end of December, 13 percent of the order backlog was already based on this kind of customer projects. Furthermore, Heidelberg says that it will show a new generation of offerings at Drupa 2020 in June, including a Speedmaster with a new “Plate to Unit” printing plate logistics to further improve both cost-effectiveness and competitiveness in offset printing.
Rainer Hundsdörfer, Heidelberg’s CEO, commented: “We are gearing Heidelberg on profitable activities and are launching an innovation initiative to expand our technological leadership in our core business,.” He added: “This will enable us to consistently adapt to the challenging market conditions, which are currently difficult to predict not least due to the uncertain economic impact of the coronavirus in China, our largest single market.”
Not surprisingly, Heidelberg has lowered its expectations for the whole year, suggesting that net sales for the year as a whole to be slightly below the previous year’s level of around € 2.490 billion. You can find more details on the company from heidelberg.com.