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Koenig & Bauer standing its ground in first quarter

Despite the protracted COVID-19 pandemic, persistent supply chain bottlenecks and the resultant increase in the cost of materials and energy, which have been additionally amplified by the war of aggression in Ukraine, the Koenig & Bauer Group entered 2022 on an upbeat note. In addition to the P24x efficiency programme and a sourcing and sales strategy adjusted to allow for the current procurement situation, the performance was largely underpinned by Koenig & Bauer’s range of products and solutions which is unique in the industry as it masters all industrial printing processes on almost any substrate – including corrugated board – and provides software, systems and services for end-to-end printing and finishing processes.

In the first quarter of 2022, order intake at the Koenig Bauer & Group came to €349.1m, 22.1 per cent up on the already good figure of €286m reported in the previous year. This was significantly better than the industry average, which declined by 5.9 per cent. At €238.4m, group revenue was slightly down on the previous year by 2.1 per cent. At €917.5m as of 31 March 2022, the order backlog was 36.0 per cent higher than the previous year’s figure of €674.5m, increasing by 13.7 per cent over the end of the previous year.

“Koenig & Bauer thus stood its ground in a gloomy economic environment in the first quarter of 2022,” says Andreas Pleßke, CEO, Koenig & Bauer. “Our order intake, which rose by around 22 per cent, shows that, contrary to the assessment of our industry association, the German Mechanical and Plant Engineering Association (VDMA), we have not yet experienced any general purchasing restraint on the part of nervous customers. Together with our historically high order backlog, we see ourselves favourably positioned for the rest of 2022.”

EBIT improved despite challenging underlying conditions and a slight decline in revenues Koenig & Bauer’s earnings before interest and taxes (EBIT) reached €-8.5m (previous year: €-8.9m). The improvement of €0.4m over the same period of the previous year is mainly due to the P24x efficiency programme (roughly €10m) despite the lower use of short-time work (roughly €5m), negative volume and mix effects (roughly €1m) and negative other effects that also include impairments of receivables (roughly €4m). The increase in the cost of materials and energy (around €6m) was offset by the announced price increases. After income taxes, consolidated net loss shrank from €-11.7m in the same quarter of the previous year to €-10.5m as of 31 March 2022. This translates into earnings per share of €-0.64 (previous year: €-0.72).

Double-digit increase in order intake in all segments – revenue painting a mixed pictureIn the Sheetfed segment, order intake in particular was very favourable, rising by 25.4 per cent thanks to higher orders for sheetfed offset presses and the post-press range. Order intake climbed to €242.1m. Revenue came to €127.4m (previous year: €145.5m), down 12.4 per cent on the same quarter of the previous year.

In the first quarter of 2022, order intake in the Digital & Webfed segment increased by 31.1 per cent to €30.8m (previous year: €23.5m), mainly due to service business and demand for corrugated board presses. At €28m, revenue was 8.2 per cent below the previous year’s figure of €30.5m. Order backlog increased by €30.7m to €91.3m (previous year: €60.6m).

Conditions in the second quarter of 2022 are also subject to uncertainties, such as the protracted global COVID-19 pandemic, which, for example, has resulted in the closure of the port of Shanghai, the conflict between Russia and Ukraine, protracted delivery shortfalls and the related increase in the cost of materials, reduced transport capacities and higher energy costs. A reliable full-year forecast for 2022 is not possible on the date on which the quarterly statement was prepared.

Says Stephen Kimmich, CFO, Koenig & Bauer AG: “Although we would all have wished for more forward visibility after the first quarter of 2022 in order to offer reliable details for our 2022 forecast, this should not distract us from we have achieved, given that in the first quarter we succeeded in fully absorbing the partially unpredictable material and energy costs of around €6m. Ongoing orders from our customers and the good progress we are making with our P24x efficiency programme are providing additional support. Consequently, we are firmly convinced that we will achieve our goals for 2022 and beyond.”

June 2022