Heidelberg achieves targets for 2018/19 – growing economic risks slow down growth

05/07/2019 6:25 p.m. CEST

Heidelberger Druckmaschinen AG (Heidelberg) achieved its operating targets in financial year 2018/19 (April 1, 2018 to March 31, 2019). Based on preliminary figures, group sales were reported at € 2,490 million – approximately 3 percent higher than the previous year. The company’s core business developed positively, and the digital business model Subscription also grew as expected with around 30 contracts signed. At 7.2 percent, the operating profit margin based on EBITDA excluding restructuring result was within the target range. The profit after taxes climbed to € 21 million.

Due to the economic downturn, the trade disputes between the US and China and the Brexit, Heidelberg is adopting a cautious approach as the new financial year 2019/20 gets underway. The company expects to see a stable development in its core business and growth in the digital subscription model. However, with underlying economic conditions making companies more reluctant to invest in new technologies, expectations regarding a ramp-up in digital printing will need to be more conservative than was originally planned. Postpress sales will grow less due to the antitrust authorities’ decision to block the takeover of MBO. Furthermore, the decline in the retail business with consumables is likely to be larger than anticipated.

While the company expects a stable overall development in group sales and profitability in financial year 2019/20 compared to 2018/19, economic conditions are delaying medium-term growth prospects. Heidelberg expects sales to rise at a slower pace than previ-ously planned, with a significantly higher proportion of the cyclically resistant contract business than at present.

Important note:
This press release contains forward-looking statements based on assumptions and estimations by the Management Board of Heidelberger Druckmaschinen Aktiengesellschaft. Even though the Management Board is of the opinion that those assumptions and estimations are realistic, the actual future development and results may deviate substantially from these forward-looking statements due to various factors, such as changes in the macroeconomic situation, in the exchange rates, in the interest rates, and in the print media industry. Heidelberger Druckmaschinen Aktieng-esellschaft gives no warranty and does not assume liability for any damages in case the future development and the projected results do not correspond with the forward-looking statements contained in this press release.

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