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Big press suppliers find the going is tough

Friday, 16 August 2002
By Print 21 Online Article

Heidelberg sales in the first quarter to June 30 were around A$1680 million (Euro 930 million) as against previous year’s $1.98 billion. Orders during the same period also slid to $1.9 billion from previous year’s $2.35billion.

Bernhard Schreier, CEO of Heidelberg, said that a pick-up in the second half of the year was essential if the company was to meet its targets. “We have now past the bottom when it comes to orders and were able to improve slightly on the previous two quarters,” he said.

The operating result fell as expected to $38 million during the period under review (previous year $81 million). The profit after taxes decreased to $22 million (previous year $52 million). “In the USA in particular, there has not been any tangible improvement yet”, stated CFO Dr. Herbert Meyer.

Best result came from the company’s Sheetfed Division which posted a profit of $134 million. At June 30, 2002, the Heidelberg Group employed some 24,700 staff worldwide.

MAN Roland is anticipating a downturn in business, despite favorable prospects in the global market for printed products over the medium and long term. Internationally, the market situation in the graphic arts industry in general and in the printing press manufacturing sector in particular remains tense. Competition is becoming tougher in the face of weak demand, putting strong pressure on manufacturing volume and pricing policies. A sweeping recovery is not foreseen in the near future. The underlying cause of the current situation is the slump in the advertising market that has made many printing companies put their investment plans, if only temporarily, on hold.

In the first six months of 2002 new orders at MAN Roland fell by 34 per cent compared to the previous period to $1,397 million. Sales came to $1,536 million, or 12 per cent less than the previous period’s figures.
Figures for the sheet-fed press sector were 36 per cent less than those achieved in the same period last year, while web-offset figures and those for trade and services compared to last year were also down by 42per cent and 10 per cent, respectively.
As of June 30, 2002, the MAN Roland Group employed a staff of 10,610. In view of continuing weak economic activity, operating results for the entire year are expected to be approximately half of the figures achieved last year ($161million).

KBAThe industry-wide slide in demand in the first quarter of 2002 also
saw the order intake at KBA: fall 35.6 per cent to $451million down from
$701million, with a sharp divide between orders for sheetfed presses
and web presses.
Bucking the trend, orders for KBA sheetfed presses in the first three months were well above the corresponding figure for 2001. Web offset presses, by contrast, were disappointing, with very few big newspaper press lines coming up for tender and a combination of overcapacity and plummeting ad sales depressing the market for smaller newspaper presses and commercial web offset presses.

“The slowdown in the global market for plant and machinery continued throughout the first quarter. This was reflected in a widespread reluctance among members of the print media to commit funds to new equipment, particularly multi-unit newspaper and commercial presses,” said Reinhart Siewert, President of Koenig & Bauer.
“Sheetfed sales, most of which are generated by our sheetfed offset plant in Radebeul, remained buoyant despite a sharp drop in demand in major markets like the USA. In fact our sheetfed offset division bucked the industry trend to post a double-digit increase in new orders compared to the same period the previous year. Although group earnings almost doubled from $1.6 million to $3.4 million, they were adversely affected by aggressive price competition in the web press sector and a renewed increase in inventories. However, we are confident that earnings will stabilize in the course of the year.”

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