Heidelberg returns to profitability

Following five years of thumping losses press giant Heidelberg is back in the black, just moving over the line with a €4m profit in its financial year, which ended March 31.

Sales for the year slipped by 12 per cent, down to €2.43bn from €2.735bn last year, although Heidelberg says after currency exchange variations have been taken into account the figure is actually €2.54bn

Dr Gerold Linzbach, CEO of Heidelberg says: “Heidelberg is once again making a net profit, which was our number one priority. Despite the weak sales situation, we have significantly improved our company’s profitability. This impressive achievement lays the foundation for further positive developments at the company.”

Like all offset press manufacturers Heidelberg was battered by the onset of the GFC and its repercussions. The company had to have a state and government funding, and has been through a series of restructuring programmes, which have seen staff numbers fall from 20,000 to 12,000. However Linzbach told Australian Printer in Germany last month that “the restructuring phase for the business is over.”

Heidelberg is now looking to move in additional markets, and has just signed a partnership deal with Fujifilm to co-develop inkjet print solutions, which will include a B1 sheetfed inkjet press, an inkjet label press, and a 3D object inkjet printer.

Linzbach says: “The big improvement in the result after tax to a net profit demonstrates the success of our strategic reorientation, even with difficult underlying conditions. This now puts us in a position to press ahead with reorganizing the company by optimizing our portfolio.”

Heidelberg says its 2013/2014 KPIs were far better than in the previous financial year. EBITDA excluding special items rose to €143m in the financial year just closed (previous year €80m).

This led to a doubling of the EBITDA margin from about three per cent to approximately six per cent. The result of operating activities (EBIT) excluding special items climbed to €72m over the twelve-month period, from minus €3m in the previous year. Linzbach says, “Our medium-term target of achieving an EBITDA margin of at least 8 per cent remains unchanged.”

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