Koenig & Bauer has underlined a year of growth in revenues and orders with chief executive Claus Bolza-Schünemann declaring: “We face 2018 with optimism in the light of the revenue and earnings growth already achieved.”
The company is no longer threatened by digitisation in any of its markets, the company says in its 2017 annual report. In the majority of markets it now has, or is close to having, a digital alternative to the analogue means of printing. Packaging is the star, accounting for 70% of the growing revenues, while sales for publication web presses fell by £25 million.
Despite this, the company increased revenue to €1,217.6 million in 2017 (€1,167.1 million) and raised inching orders to €1,266.3 million (€1,149.7 million). However, ongoing costs in the flexible presses division and the development costs of inkjet, corrugated board and the two-part can presses, had an impact on pretax profits which dipped from €81.0 million to €78.5 million.
The sheetfed press operation was again the star division, increasing revenue from €615.0 million to €660.2 million and Ebit to €37.5 million from €31.3 million. In contrast revenue in digital and web fell from €183.6 million to €154.2 million. This division includes newspaper and commercial web offset presses. Orders for new presses now accounts for just 12% of this revenue, while the supply of spare parts for the ageing fleet of newspaper and heatset web presses accounts for 50% of revenues.
The division will include the Flexotecnica flexo presses, where there are ongoing efforts to deliver a turnaround for a business where K&B wants to challenge the leading businesses in flexo print. It also includes the impressive RotaJet press aimed at book printing and wallpaper. Orders from the latter customer group have been slow, there has “only been muted willingness on the part of decor printers to migrate to digital systems” the company declares.
If this is disappointing, the growth of packaging is the driver for the business. Bolza-Schünemann says that in addition to orders for the 17,000sph rotary die cutter, “a sharp rise in new contracts for flatbed die cutters exceeded expectations substantially”.
The company is optimistic for corrugated board. It has a pilot customer lined up for the CorruCut flexo and inline die cutting line for delivery early in 2019. This is accompanied by the CorruFlex and CorruJet inkjet corrugated board press in the portfolio. The company points to predictions of 4-5% growth in packaging and says that it believes expansion in online retail sales, including food, will drive a faster growth than this. It is enjoying the success that HP is having: this drives demand for the HP 1100S inkjet press, the frame for which is produced in Würzburg.
K&B has a long term plan to grow revenues 4% a year, 2% of that coming directly from sales of packaging presses. There is growth from security where banknote demand is up 3% worldwide. It will also expand revenues from service, planning to reach 30% of group revenues by 2021. It is on course having lifted the share of revenue from service from 23.5% in 2016 to 25.6% last year.
The Varijet earns a mention, though not in detail and the proposed Fuji-Xerox deal may lead to a rethink. The Iberica platens are being upgraded and as well as the RDC106 die cutter, there is the RSP106 rotary screen press to provide sales growth.
Koenig & Bauer is firing on all cylinders from cartons through corrugated and can printing, with the exception of flexo where reorganisation continues. The target is still to challenge the leading suppliers of flexo presses.
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Ongoing efforts to deliver a turnaround where K&B wants to challenge the leading businesses in flexo print also includes the impressive RotaJet inkjet press. Aimed at book printing and wallpaper, so far, orders have been slow.
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