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manroland Posts Order Gains in First Half of 2011

Press release from the issuing company

Incoming orders rose by 13% to 520 million euros, sales improved slightly by 7% to 435 million euros

manroland is benefiting from the economic recovery and continuing strong demand in the growth regions. In the first half of 2011, manroland recorded a rise in orders for both the sheetfed and webfed sector. Compared with the same period in the previous year, incoming orders rose by 13% to total 520 million euros. The already good volume of orders in the sheetfed sector increased slightly once again (+2%). Last year the webfed sector was not yet able to benefit from the recovery but in the period under review tracked the positive development of the sheetfed sector and recorded considerable gains in orders (+33%). manroland achieved an operating result (EBIT) of -25 million euros and thus reduced the losses incurred in the previous year by almost half.

The product innovations developed in response to demand were significant drivers behind the success in recent months. One pleasing aspect is the annual growth of more than 4% in the services business that is to be expanded: spare parts and maintenance concepts (printservices), along with consumable materials (printcom). With 435 million euros, total sales were around 7% higher than in the previous year. The main drivers of growth were the BRIC countries. Here, manroland benefited especially from the strong demand in China. Due to the importance of growth markets for manroland's business, the company decided to take over control of the sales and service networks in South America, southern Africa, Southeast Asia, Australia and New Zealand in 2009. This market organization has been able to achieve great success in the meantime. As in the past, the export ratio remained stable at around 80%.

"With a gain in orders and increased sales, manroland achieved a pleasing result for the first half of 2011," reports manroland CEO Gerd Finkbeiner. "The strategic alliance with Océ in the digital printing sector will further strengthen manroland's leading position in the future. With technical innovations like product safety in packaging printing, automation features with robot technology for newspaper presses, and new developments in high-volume commercial web offset printing, we are showing that print has a bright future."

This positive development has also had an effect on the employment situation: short-time work at the Offenbach factory, which has become necessary due to the economic crisis, ended in June. On group level, the job cuts already announced due to long-term capacity alignment are running according to plan. By the end of 2012, the number of employees is scheduled for reduction to under 6,000. Not including external personnel and trainees, as of June 30, 2011, manroland had a total staff of 6,630 worldwide, with approximately 84% in Germany. This represents a decrease of roughly 11% from the previous year.

Despite the positive development, manroland does not expect a return to the boom level of 2007. "We are assuming 75% of the pre-crisis volume in the sheetfed sector and around 60% in the webfed sector. Measured against the boom year, our sheetfed results at present are at approximately 60%, and webfed almost 50%," says Finkbeiner. For the full year 2011, manroland targets sales of more than one billion euros.

The product innovations for commercial and sheetfed printing presented in the first half of 2011 were greeted enthusiastically by international customers and are bound to stimulate sales in the second half of 2011. The partnership with Océ and the resulting opportunities for combining both offset and digital printing have also generated strong interest amongst customers. The IFRA Expo fair in Vienna in October will bring further impetus to newspaper printing. A slight decline in demand is nevertheless expected, particularly in China.

The new manroland Industrial Services business sector was established on January 1, 2011 and now has around 100 employees. In the medium term, this number is expected to increase to about 300. manroland offers the services of highly qualified personnel for the engineering sector and thus responds to the growing demand for specialized skilled staff. Another growth area is the new business sector manroland Mechatronic Systems in Plauen, which supports customers through expanding their development and production capacity. On request, manroland takes over the complete realization of projects, as well as manufacturing and assembly of individual components – from large assemblies right up to plant and equipment that works in tolerances measured in micrometers. The two new business sectors that were established in the course of the strategic realignment announced in fall 2010 are expected to already make a positive contribution to the company's earnings in the second half of 2011. They show how manroland's core expertise can also be successfully utilized beyond the company's core business.


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