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KBA boosts sales, order intake and earnings

Press release from the issuing company

8/14/07 -- Würzburg. In the first six months German press manufacturer Koenig & Bauer (KBA) posted group sales of €794.9m, 9.4% up on the previous year’s €726.5m. The order intake rose 1% to €726.3m (2006: €719.3m).
While sales by the web and special press division climbed by 6.9% from €393.5m to €420.5m following a big increase in shipments to gravure and security printers, soft demand for newspaper and gravure presses meant that the intake of web press orders was down on the previous year, despite some spectacular contracts that included a big Cortina 6/2 press line for Le Figaro in Paris. However, thanks to brisk demand for special presses the total volume of new orders booked by the division came to €350.6m, not far short of last year’s €354.6m.
Sheetfed sales of €374.4m were 12.4% up (2006: €333m) and the volume of new orders rose 3% to €375.7m, with subsidiary KBA-MetalPrint, which was consolidated in the second half of 2006, making a contribution to this year’s figure.
 Sales exceeded incoming orders in both divisions, cutting the order backlog to €880.1m (2006: €1,033.7m), comprising €306.7m (2006: €343.4m) for sheetfed presses and €573.4m (2006: €690.3m) for web and special presses. The backlog will keep KBA’s sheetfed plants in Radebeul and Dobru?ka (Czech Republic) busy until well into the fourth quarter, and plant utilisation is also high at the Group’s niche-focused subsidiaries. However, it will not safeguard full employment for the rest of the year at the web press production plants in Würzburg, Trennfeld and Frankenthal.
Pre-tax earnings higher
Operating profit jumped from €18.8m to €27.2m. Pre-tax earnings (EBT) increased to €25.6m or 3.2% of sales (2006: €18.7m and 2.6%). After deducting income tax KBA closed the half-year with a net profit of €19.1m (2006: €12.5m) and proportional earnings per share of €1.17 (2006: 77 cents). The free cash flow was €10.7m (2006: €32.5m). Funds eased up to €155.9m from €154m at the end of December. Equity represented 34.1% of the balance sheet total.
At the end of June the Group payroll totalled 8,241 (2006: 7,936), with 290 of the additional 305 staff resulting from the consolidation in mid-2006 of Stuttgart-based KBA-MetalPrint.
Export level climbs to 87.9%
Softer domestic sales (€95.8m, down from €120.1m in 2006) raised the export level to 87.9%. Once again the rest of Europe was KBA’s biggest market, with sales worth €427.4m contributing 53.8% of group revenue, a year-on-year increase of 22.9%. Asia and the Pacific came second with €124.1m (15.6%), followed by North America with €83.3m (10.5%). Sales in Latin America and Africa soared to €64.3m (8.0%).
Outlook for 2007 unchanged
Despite below-capacity production at KBA’s web press plants in the second half-year, Bolza-Schünemann reaffirmed his spring projection that the Group would meet its 2007 sales target of around €1.7bn and post pre-tax earnings of a similar magnitude to last year’s €47.4m.