Stronger quarter confirmed, but outlook is tough
In reporting on its second quarter (July-September 2019), Heidelberg succeeded in almost compensating for the relatively weak start to the year. As a result, sales for the quarter were up 9% to €622m, EBITDA (excluding restructuring result) up 28% to €55m and incoming orders up 1% to €648m.
The company said the main boost to business came from the ongoing digitisation of processes (Push-to-Stop technology) in the core business of sheetfed offset printing, which is currently generating higher sales in the United States and China in particular. Digital business models such as subscription are also making a positive contribution, as is the growing proportion of recurring sales from contract business and e-commerce. Subscription business now accounts for over 10% of the order backlog. The medium-term goal at Heidelberg is to significantly reduce the company’s exposure to economic fluctuations by generating around a third of total sales from recurring business.
However, business in Germany, the UK and the rest of central Europe remains difficult because of the reluctance to invest caused by the economic situation.
Against the backdrop of the measures introduced, the solid performance in the second quarter, and the assumption that the economic environment will not deteriorate further, Heidelberg confirms its targets for financial year 2019/2020 as a whole, with sales at the same level as in the previous year.