German press manufacturer Koenig & Bauer is spending to save, as it adjusts to 'moderate growth' and revenue of 1.3 billion Euros.
At the group's annual meeting, president and chief executive Claus Bolza-Schünemann said cost savings of more than 100 million Euros a year until 2024 were planned, leading to a seven per cent return on sales.
He said the "worsening international course" of COVID-19 pandemic in the fourth quarter was expected to impact performance, with group revenue forecast between 900-950 million Euros. EBIT is expected to be negative, before special items "in the mid double-digit million range".
Third quarter order intake was down 13.8 per cent at 232.6 million Euros, and revenue down 32.2 per cent year-on-year.
A 'Performance 2024' programme, enhanced and expanded, to strengthen the group's position in packaging, industrial, security printing and postpress - as well as to increase operating profitability - has called for one-off costs of 57.6 million Euros. A new "revenue recognition guideline" reduced EBIT by 6.3 million Euros, but allowed the sale of real estate in Frankenthal with proceeds of 4.8 million Euros.
Despite a cumulative loss of 102.2 million Euros for the first three quarters of 2020, cash flows from operating activities and free cash flow were "in distinctly positive territory" in the third quarter at 20.8 million Euros and 26.9 million Euros, respectively. An "encouraging" order intake of 34.1 million in the Digital and Web division for the third quarter of 2020 was driven by sales successes with RotaJet presses and HP machines.
Financial statements can be downloaded as a PDF file from here.
• A year-long transition will see Kilian Renschler - current executive vice president of sales - take over as chief executive and president of the group's North American operations, Koenig & Bauer (US/CA), with Mark Hischar retiring on December 31, after 11 years at the helm.
Claus Bolza-Schünemann says Renschler has "the perfect mix of skills and experience" to drive continued success. He is an industry veteran with more than 30 years experience in the graphic arts industry, and returned to Koenig & Bauer in late 2019.
Pictured: Kilian Renschler with outgoing president and chief executive Mark Hischar