Heidelberg Achieved Sales of around 1.9 Billion Euro in the First Half of Fiscal Year 2002/03

• Sales and result below previous year's figures as expected
• Efficiency-enhancing program gets off to successful start
• Company still aims at keeping net profit on a positive level for the full year despite restructuring costs

As expected, the figures reported by Heidelberger Druckmaschinen AG (Heidelberg) for the first six months (April 1 to September 30) of fiscal year 2002/2003 did not match those of the previous year. Sales by the Heidelberg Group in the first half of the year were around 1.9 billion Euro (previous year: around 2.3 billion Euro). Incoming orders during the same period were a good two billion Euro (previous year: 2.5 billion Euro). "The first half of the year was shaped by the continuing weakness in the world economy and the resulting investment reluctance in the USA and Germany ", stated Bernhard Schreier, CEO of Heidelberg. "We are not anticipating an economic recovery this year and believe that, even in 2003, the global economy will only begin to pick up speed again slowly." 

The operating result fell as expected to 36 million Euro during the reporting period (previous year: 110 million Euro). The net profit was 13 million Euro (previous year: 62 million Euro). "We are not satisfied with the results", stated CFO Dr. Herbert Meyer. "To ensure a sustained improvement in our earnings power even in these difficult times, we have introduced efficiency-enhancing measures worth 200 million Euro."

As of September 30, 2002, the Heidelberg Group had a workforce of around 24,500 worldwide (excluding the 500 personnel of the newly consolidated Gallus Group).

Efficiency-enhancing program initiated immediately
The measures aimed at achieving the 200 million Euro savings were already introduced in October. The program to increase efficiency and ensure lasting cost reductions is expected to become fully effective in the next fiscal year. Savings of 110 million Euro are set to be made in the Sheetfed Division, 40 million Euro in Digital, 30 million Euro in Web Systems and 20 million Euro in Postpress. There are plans to cut staffing levels worldwide by some 2,200 as part of the program. Discussions about the planned job losses are expected to be concluded by the end of the current fiscal year.

Prospects for fiscal 2002/2003
Heidelberg had announced in September that it anticipated sales for the full year to be around ten percent down on the previous year (approximately five billion Euro). "The Management Board continues to believe the Company will achieve this level of sales. Despite the one-off expenses of up to 140 million Euro all efforts will be made to keep the net profit this fiscal year on a positive level", stated Schreier.

Heidelberg will continue to be affected by global economic developments in the future too. "No far-reaching recovery in the world economy is expected during the next calendar year either", stated Dr. Meyer. "Therefore, the economic success of the Heidelberg Group depends essentially on bringing about a sustained improvement in cost structures".

For further information:
Heidelberger Druckmaschinen AG
Investor Relations
Dirk Kaliebe
Tel: +49 (0)6221 92 60 20
Fax: +49 (0)6221 92 60 61
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