AGFA CEO Comments on First Quarter, CTP Transition Speeding Up
Press release from the issuing company
MORTSEL, Belgium, April 24, 2001 - On the occasion of the Annual General Meeting of shareholders of Agfa-Gevaert N.V. Dr. Klaus Seeger, CEO and Chairman of the Board of Management, will comment on the developments in the first quarter of the Agfa-Gevaert Group.
Some significant developments have occurred since the start of the financial year. Firstly, Agfa-Gevaert has received a letter of Schroder Ventures, one of the world's largest private equity firms. Schroder proposed to acquire the business units Film, Finishing and Laboratory Equipment of Consumer Imaging and to take an option to acquire the business unit Consumer Digital Imaging.
The negotiations with Schroder Ventures are running. If they should present a positive result, the acquisition will include all concerned employees and production sites, including the world-wide sales departments.
At this moment the outcome of the negotiations is still open. However, both parties strive to reach a final result soon.
Concerning acquisitions, I would like to inform you that we recently acquired Talk Technology. This North-American company is specialized in voice-enabled clinical workflow and reporting solutions for healthcare. Thanks to this acquisition we will be able to further strengthen our positions in the field of Medical Imaging.
We have also signed a letter of intent concerning the acquisition of Seifert, a German-American company, a producer of industrial and analytical X-ray equipment and systems for the non-destructive testing (NDT) market. This acquisition will further strengthen our leading position in this market.
Concerning sales, 2001 seems to become a more difficult year than the past one. The prospects for global economic growth are indeed very cautious. The United States are confronted with a fast economic slowdown and it is still highly uncertain if - and to what extent - this slowdown will affect Europe and the rest of the world.
This situation has also influenced Agfa's sales for the first quarter. Our sales for the continued activities decreased by more than 5% or 72 million euros compared to the first quarter of 2000. This decrease occurs mainly in Consumer Imaging, the business segment that is the most sensitive to business cycles.
In Graphic Systems, especially the business unit Photographic Pre-Press Systems is affected by the slowdown in the United States. Furthermore, the technological shift to computer-to-plate is continuing at a higher speed.
On the other hand, Technical Imaging's sales increased by nearly 10%.
It is promising that in March, sales in all our business segments showed a clear improvement compared to the first two months of this year.
The final consolidated figures for the first quarter will be available on the 17th of May. But already today it is clear that the decrease in sales will lead to a decrease of the EBIT of well over 40%.
We, as well as many companies, experience that it is, particularly at this time, risky to give prospects for the whole year.
However, we hold to our objective for 2001 to achieve double-digit growth in net profit growth. Agfa will continue to strive to generate strong cashflows with its traditional activities and to strengthen its positions in the new digital solutions once again".
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