Heidelberg is talking up a 6% increase in sales, a big boost to operating profit, and opportunities in new growth markets as positives for the business at the three quarters stage of the financial year.
But concerns must still remain. Incoming orders are down, against the higher than at this point last year when a Drupa effect could still be felt. The backlog has dropped from €902.9 million to €708.7 million and free cash flow has dropped because the company has received fewer orders meaning fewer deposits received.
The value of new orders dropped least in North America, down 5%, despite tariffs. Heidelberg says that customers understand they need to invest. There was a clear improvement in Q3 it says. New orders in Europe fell 11% which would have been worse had not the Italian government continued to support companies wanting to modernise. In the Asia-Pacific region orders slipped 14% with strong foreign exchange effects blamed,
Sales will have been lifted by the acquisition of Polar or a sum in “the low double digital range”, though Heidelberg is not saying by how much.
Overall revenue increased to €1,602 million after nine months compared €1,509 million packaging and label presses orders in the third quarter helped lift sales by 4% to €617 million for the quarter. Operating profit reached €114 million (€86 million).
Nine months into the year sales of print and packaging equipment are almost €100 million higher at €804 million (€705 million).
The continued clamp down on costs and efficiency measures helped increase operating profit. “The measures we have initiated are confirmation of our growth plan,” says CEO Jürgen Otto.
“Both strategically and operationally speaking, Heidelberg is extremely well positioned to actively hone this plan and leverage additional opportunities in dynamic future markets.”
These will include defence, security and energy sectors under the Heidelberg Technology division. This currently small beer with year to date sales of €42 million (€41 million).
The company is also stressing the opportunities that the introduction of Jetfire 75, its B2 inkjet represents even though this will not be available until the latter part of the year. This is press based on an OEM deal with Canon. The company’s results and presentation do not mention the large format press, the Cartonmaster CX145 that was announced a year ago and is a joint venture with Manroland Sheetfed.
