Editions   North America | Europe | Magazine


Océ reports small net loss over Q1 2011

Press release from the issuing company

Highlights First Quarter (Ended 31 March 2011):

- Net Loss: € - 6 Million (2010: € - 87 Million)
- Normalized Operating Income: € 5 Million (2010: € 15 Million)
- Total Revenues - 1% To € 638 Million (2010: € 647 Million)
- Organically: Non-Recurring Revenues - 5%; Recurring Revenues - 3%
- Cooperation With Canon Delivered First Joint Innovation
- Change Of Financial Year, Effective 1 January 2011

Comments By Rokus Van Iperen, Chairman Of The Executive Board:

'Océ Had A Challenging First Quarter As Revenues Decreased Due To A Decline In Two Market Segments. Cutsheet Revenues Were Impacted By Weaker Printroom Sales And Portfolio Changes. Technical Documentation Revenues Were Affected By The Ongoing Crisis In Construction Markets. We Have Addressed These Revenue Developments By Strengthening Our Support For Sales Companies And By Stringent Cost Control.

Océ Achieved Favorable Revenue Development In Two Other Market Segments. In Continuous Feed Printing, Océ Boosted Its Market Leadership Due To Continued Revenue Growth, Benefiting From Printer Sales Of Particularly The Océ Jetstream Series. In Display Graphics Printing, Sales Grew Due To The Highly Successful Océ Arizona Series. In Business Services, Revenue Development Was Stable.'

Change Of Financial Year

As Announced Previously, Océ Has Aligned Its Financial Reporting With That Of Canon, Consequently Starting The New Financial Year On 1 January 2011. To Facilitate Transparency And Comparison, The Figures Presented In This Release Relate To The Period January - March 2011 And The Corresponding Prior Year Period.

Group Results First Quarter 2011


Total Revenues Declined By – 1% To € 638 Million, Due To Lower Revenues In Dds And Tds. Organically, Revenues Declined – 3%.

The Share Of Color Grew To 38% Of Revenues (2010: 30%).

Non-Recurring Revenues Declined By – 3% To € 172 Million. The Organic Decrease Was – 5%, Mainly From Lower Cutsheet And Tds Sales. Non-Recurring Revenues Grew In Continuous Feed And Display Graphics.

Recurring Revenues Decreased By – 1% To € 466 Million. The Organic Decline Was – 3%, Due To Dds And Wfps. Revenues For Obs Were Stable.

Gross Margin And Operating Income

As Of The Year 2011 The Gross Margin Definition Has Been Changed To Align With The Financial Reporting Of Canon. The Main Change Relates To The Cost Of Service Personnel Which Previously Was Recorded Under Cost Of Sales And Now Is Included In Operating Expenses.

In The First Quarter Of 2011, Normalized Gross Margin Was 62.6% (2010: 63.1%). Gross Margin Mainly Declined Due To Wfps € – 4 Million (– 0.6% Point) As A Consequence Of A Change In The Sales Mix From Tds To Dgs. Gross Margin Improved Due To Better Obs Margins (+ 0.2% Point) And Decreased (– 0.2% Point) Due To Mix Change Within Dds And Lower Factory Utilization.

Normalized Operating Expenses Amounted To 61.9% Of Revenues (2010: 60.9%). However Total Costs Of € 394 Million Were In Line With The Same Quarter Of 2010, With Business Savings Of € 5 Million And Foreign Exchange Impact Of € – 6 Million.

Total R&D Cost Increased € 6.6 Million Versus The Same Period Last Year, Mainly Due To Lower Capitalization. On Balance, Normalized Operating Income Amounted To € 5 Million (2010: € 15 Million).

Operating Income Amounted To € – 4 Million (2010: € – 25 Million), Including € 9 Million One-Off Items (2010: € 40 Million).

Finance Expenses (Net) And Net Income

As A Result Of The Refinancing Of Océ's Debt By Canon, Interest Costs Decreased Compared To Last Year. Finance Expenses (Net) Amounted To € – 6 Million (2010: € – 13 Million, Excluding Canon Related One-Off Items).

On Balance, Net Income Was € – 6 Million. In 2010 Net Income Amounted To € – 87 Million, Including Significant Canon Related One-Off Items On Operating Income, Financial Expenses And Taxes.

Earnings Per Ordinary Share For Net Income Attributable To Shareholders Was € – 0.08 (2010: € – 1.04).

Balance Sheet And Roce

The Balance Sheet Total Was € 2,100 Million (Ultimo 2010: € 2,142 Million) At The End Of The First Quarter Of 2011. Net Capital Employed Was € 1,118 Million (2010: € 1,095 Million). In Relation To Normalized Operating Income, Roce Amounted To 4.4% (2010: 5.2%).

Free Cash Flow

Free Cash Flow In The First Quarter Of 2011 Was € – 71 Million (2010: € – 10 Million) Mainly Due To Outflow In Liabilities (€ 39 Million), Receivables (€ 15 Million) And Rentals (€ 11 Million) Versus Improvements Last Year In All Working Capital Areas.

Update Cooperation With Canon


Océ Continued To Offer To Customers Worldwide A Broad Range Of Canon Office Products, Including The Imagepress And Imagerunner Series. Similarly, Canon Continued To Offer To Customers Worldwide The Océ Prismaprepare Software And The Océ Varioprint 6000 Line. In The Quarter, Canon Dealers Started To Purchase The First Of These Systems In The Us. The Special "Canon Camp" Continued Into The First Quarter, In Which The Océ Sales Force Was Trained To Sell The Canon Product Portfolio. At The End Of The Three-Month Period, Approximately 1,500 Océ Sales And Service Representatives Had Taken Part In This Training And Information Program. At Various Trade Fairs In India, Korea, Dubai And China, Canon Announced That It Would Be Selling Océ Products Throughout These Regions.

Joint Product Development

The First Digital Production Press Jointly Developed By Canon And Océ Went To Market During The First Quarter. On 22 March 2011, During Tradeshows In Barcelona And Washington, D.C., The Canon Imagepress C7010Vps Was Launched. This Digital Press Combines The Image Quality And Productivity Of Canon Hardware And The Processing Power Of Océ Prismasync Workflow. This Launch Signified An Important Milestone In The Combination As It Is Living Proof Of The Joint R&D Opportunities To Offer Customers Access To The Leading Technology In The Industry. Other Jointly Developed Products Will Be Introduced Later This Year.

Preparing The Integration

Further Steps Were Taken To Prepare The Way For Cooperation And Integration. Employees From Canon And Océ Were Involved On A Daily Basis During This Quarter In Capturing The Benefits Of The Cooperation In Teams Ranging From Sales & Services, Research & Development, Manufacturing & Logistics To Information Systems, Intellectual Property And Finance & Administration.

Sbu Results First Quarter 2011

This Paragraph Provides An Overview Of Developments In The Strategic Business Units For The Period January – March 2011.

Digital Document Systems (Dds)

Continuous Feed Printer Sales Sustained Their Strong Sales Trend. According To Independent Industry Analysts, Océ Expanded Its Leading Market Position In Continuous Feed Color (Inkjet And Toner) In The Combined Western Europe And United States Markets To 30% And In Black & White To 47% In 2010.
As Of Early 2011, Océ Prepared The First Installation Of Its Latest Innovation, The High-Productivity Inkjet Continuous Feed Color Printing System Océ Colorstream 3500. Launching Customer Is The French Print Provider Corus, Headquartered In Lyon. Annually, Corus Is Printing Over 50 Million Color Pages.

The Strategic Alliance With Manroland Progressed According To Plan. The Agreement Covers The Joint Development, Marketing, Sales And Service Of Digital Printing Technology For The International Offset Markets. In The Quarter, Océ And Manroland Jointly Presented The Alliance During Trade Meetings In Russia And Germany.

In The Quarter, Océ Signed A New Worldwide Multi-Year Contract With Gdf Suez, Covering Over 20 Countries. Under This Contract, Océ Will Deliver Over 9,000 Plotters And Multi Functional Printers. The Global Business Of This Contract Is Potentially Valued At € 55 Million.

Revenues In Dds Amounted To € 346 Million. Organically, Revenues Declined By – 6%. The Share Of Color Was 32% Of Revenues (2010: 25%).

Non-Recurring Revenues Amounted To € 108 Million. Organically, Revenues Decreased By – 10%, Especially Due To Decline In Cutsheet Sales. Reasons For The Decline Are The Transition Of The Product Portfolio, But Also The
Lower Sales Of (Very) High Volume Printers To Printrooms. Continuous Feed Printer Sales Were Strong In The Us.

Recurring Revenues Amounted To € 238 Million. Organically, Revenues Declined By – 4%. Both Europe And The Us Showed Declines.

Normalized Operating Income Declined To € – 2 Million (2010: € 2 Million), Due To The Lower Cutsheet Sales. It Was Also Impacted By Lower Factory Utilization In Venlo. Utilization Of The Poing Plant In Germany Improved Due To Encouraging Continuous Feed Printer Sales.

Wide Format Printing Systems (Wfps)

Compared To The First Quarter Of 2010, Wfps Printer Sales Showed Some Recovery, Mainly Driven By Increased Sales Of Display Graphic Systems. Printer Sales For Construction And Engineering Purposes Were Impacted By Challenging Market Circumstances. In The Us, Océ Expanded Its Wide Format Dealer Network, Benefiting From A Change In The Competitive Environment.

In The Quarter, Océ Introduced An Innovative Wide Format Printer, The Océ Colorwave 600 Poster Printer, Built With Océ Crystalpoint Imaging Technology, Targetting The International Screen Printing Markets.

Revenues In Wfps Amounted To € 175 Million. Organically, Revenues Declined By – 1%. The Share Of Color Increased To 53% (2010: 45%).

Non-Recurring Revenues Amounted To € 64 Million. Organically, Revenues Increased By 4%. Growth Was Driven By Both North America And Europe.

Recurring Revenues Amounted To € 111 Million. Organically, Recurring Revenues Declined By – 4% Mainly Due To Decreasing Click Volumes On Technical Documentation Systems.

Normalized Operating Income Decreased To € 1 Million (2010: € 8 Million), Reflecting The Decline In Recurring Revenues.

Océ Business Services (Obs)

Revenues In Obs Amounted To € 117 Million. Organically, Revenues Were Stable. In The Us, Océ Gained New Customers And Created Growth With Innovative Digital Documentation Services, Compensating The Decline In Mail Services, Leading To An Overall Organic Growth. In Europe Revenues Were Impacted By Declining Print Volumes And Restructuring Of Inefficient Sites, While Obs Expanded Its Activities In Belgium, France And Scandinavia.

Normalized Operating Income Improved To € 6 Million (2010: € 5 Million), Due To Higher Gross Margins And Tight Cost Control.

Outlook 2011

Océ Aims To Improve The Business By Focusing On Growth Of Revenues, Profits And Cash. Océ Intends To Grow The Business By Strengthening Its Position In Mature Markets, Expanding In Growth Markets Like Graphic Arts And Document Services And Boosting Cross Selling With Canon. Jointly With Canon, Océ Will Expand Its Activities In Growth Markets Like China And India. Océ Will Enlarge Its Product Portfolio, Amongst Others By Introducing Innovative Printing Systems, Jointly Developed With Canon. Also, Océ Will Continue To Prepare For The Integration With Canon.


Join the discussion Sign In or Become a Member, doing so is simple and free

WhatTheyThink is the official show daily media partner of drupa 2024. drupa Event Coverage | drupa daily programs