Koenig & Bauer is on the offensive, aiming to take company revenues to €1.5 billion with Ebit margin between 7010% by 2023.
After the years of consolidation and stemming the decrease in orders for web offset and newspaper printing, the Growth Offensive 2023 is the company’s strategy to achieve shareholding pleasing growth.
It will come through striking while packaging is hot, from cartonboard, corrugated, flexible packaging print to marking and coding, two-piece cans, post press for packaging, printing directly to glass and in decor. As well as the decline in web offset and in the demand for commercial sheetfed presses, this will help iron out the drop in sales and the volatility of security print sector.
That said in Q1 of this financial year, Koenig & Bauer says that improvements in incoming orders to €230.7 million (€217.3 million), were helped by a strong performance from security print, though declines to name customers. Orders for special presses rose to €80.0 million (€58.1 million in the quarter.
Sheetfed orders also rose, aided by successful at the Print China exhibition which returned orders of mid-double-digit growth. It does not, however, identify the clients. The sheetfed business increased revenue to €173.5 million (€154.3 million).
As well as improving business in China, the company enjoyed a strong quarter domestically as new orders climbed and revenue increased to €43.0 million (€26.8 million) for the period in Germany. Sales to Europe, and to North America fell, to €29.8 million (33.2 million) and to €75.4 million (€90.8 million) respectively. Despite the success of Print China, which fell outside the quarter, revenue from the Asia Pacific region was down at €49.0 million.
The costs of attending Print China are also linked to the decline in Ebit earnings for the sheetfed division. This fell to a loss of €3.1 million as a result combined with an unfavourable product mix. These contributed to an increased order backlog of €656.6 million and ensures full utilisation of production capacity.
The aim now is to raise revenues by up to 50% to achieve the five year target which CEO Claus Bolza-Schünemann is confident can be achieved. “We want to actively exploit the currently available market opportunities” in packaging sectors to “achieve sustained profitable growth”.
While there are costs of €50 million associated with this programme, the company is on course for an end of year revenue growth of 4% over 2018 and an Ebit margin of 6%.
By Gareth Ward