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Xeikon’s silver lining

Thursday, 01 March 2012
By Print21
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Cost-cutting and increased operational efficiency have combined to help boost Xeikon’s seven per cent drop in sales for 2011 to result in an end-of-year net profit of EUR €7 million, well in excess of the previous year’s EUR €4.7 million net profit.

According to the company’s 2011 financial results, released this week, Xeikon’s operational cash flow (EBITDA) for the year was EUR €30.5 million, only marginally lower than the previous year’s EUR €31.3 million. This is despite a reported seven per cent drop in sales, from EUR €139.3 million in 2010 to EUR €129.8 million for the year ending December.

The company claims that the minimal cash flow impact from the sales slump was primarily the result of strict cost management, efficiency improvements and a better product mix. The company also cited lower asset depreciation as helping elevate the bottom line for 2011.

Xeikon’s strong Digital Printing Solutions division remained steady over the course of the year, but its Prepress Solutions business was down by over 20 per cent – a trend that the company says it will attempt to stem following the acquisition of the Flexolaser technology from German company, RSD Technik GmbH, and the Thermoflex brand from the Eastman Kodak Company at the end of 2011.

These acquisitions are part of an ongoing strategy by the company to build its Prepress Solutions division and strengthen its standing in the label and packaging market. Xeikon says it is launching a new product line within its CtP business and hopes to become a leading digital solutions provider in the flexographic market.

The company’s equipment sales in 2011 were down three per cent compared to the previous year, while income from consumables and service activities fell by 5.6 per cent. However, despite a drop in overall sales of 12.8 per cent in Europe and 7.7 per cent in Asia, Xeikon’s American sales rose by 7.4 per cent – an indication of growing confidence in the region.

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