Heidelberg has sold the first Cartonmaster CX145 even before it has found a solution for producing the machine. Fortunately Manroland Sheetfed had produced a machine before its ultimate demise. This was to be delivered to the Heidelberg Home of Print over the summer. It can now be updated to Heidelberg’s spec and shipped to a customer.
The demise of Manroland Sheetfed, however, has given Heidelberg a dilemma. The idea had been for Manroland Sheetfed to exploit is lower cost base to make the VLF press more cost effectively than Heidelberg can produce the machine.
“We are currently examining options for further production and development of this system at a low cost location,” CEO Jurgen Otto told last week’s AGM. “We have an estimated timeframe of approximately 24 months for the completion of the integration. Customer interest is high.”
Otto had plenty of good news to highlight in the address to shareholders even against the background of global geopolitical and economic conflicts. “We are coming off a challenging financial year. But we are also coming off a year in which we made important decisions, achieved significant progress and laid the foundation for the next pages of our company’s development.”
That is taking the company deeper into energy systems and defence technology. The latter leverages Heidelberg’s manufacturing and electronic expertise to produce vehicles and drones in partnership with Israeli and now Ukrainian companies. A new deal with a Swiss company will lead to development of sodium ion batteries, reckoned to be a less expensive alternative to lithium ion power storage.
Heidelberg is reducing its workforce by 650, 350 having already gone and the remaining reduction agreed. A wage freeze is in place. However, it has gained a similar number of employees through the absorption of the sales and service network for Manroland Sheetfed, which provides access to a further 3,000 customers “We plan to further expand our business with these customers in the future,” says Otto.
The business has also acquired Polar Schneider Systeme and increased collaboration with MK Masterwork to include all its packaging systems including its robotics systems. The deals ensure that Heidelberg can claim to be a full end to end system integrator for the packaging sector.
The development of the lifestyle business, represented by recurring revenues in service, consumables and spares, reduces the dependence on one-off machine sales and smooths the revenue. Currently 46% of revenue comes from lifestyle and 52% for print and packaging machinery. The remainder derives from the developing advanced technology areas. “Heidelberg is transforming from a pure machine supplier into a digital, service oriented system partner with potential for recurring revenue,” Otto explained.
“Heidelberg must constantly evolve – strategically, technologically an in terms of personnel,” he told shareholders. “We are coming off a challenging financial year. But we are also coming off a year in which we made important decisions, achieved significant progress, and laid the foundation for the next phase of our company’s development.”
That will involve partnerships, like that with Canon for inkjet presses and specifically with companies in the defence and energy sector to utilise Heidelberg’s facilities, skills and experience to take advantage of opportunities with drone, self drive vehicles and new type of battery that are emerging now.
There are synergies. He explained: “The Unmanned Ground Vehicle (UGV) we developed still thinks it’s a printing press, because the built-in control system comes directly from one.”
