Heidelberg publishes figures for the third quarter of 2019/2020

Heidelberg (ots) - · Preliminary figures of January 20, 2020 confirmed

· Package of measures to increase profitability underway

· Digitization is being vigorously pursued: Subscription business

continues to grow, innovation initiative for drupa 2020

Heidelberger Druckmaschinen AG (Heidelberg) today published its report on the
third quarter of 2019/2020, confirming the key figures of the press release
published on January 20, 2020.

Heidelberg is in an advanced planning stage with regard to the extensive package
of measures announced to sustainably improve profitability and liquidity.
Important cornerstones are to be adopted before the end of the current financial
year and are expected to show the first positive effects already in the new
financial year. The measures include streamlining and focusing the
organizational structures more strongly on customer needs and more efficient
processes, selling additional non-core areas to focus the product portfolio, and
restructuring the international production network to significantly reduce the
cost base.

"We are gearing Heidelberg on profitable activities and are launching an
innovation initiative to expand our technological leadership in our core
business," comments CEO Rainer Hundsdörfer. "This will enable us to consistently
adapt to the challenging market conditions, which are currently difficult to
predict not least due to the uncertain economic impact of the coronavirus in
China, our largest single market.

Digitization is being driven forward - innovation initiative at drupa 2020

The goal is and remains to focus the Group on customer-centric solutions and to
continue to drive forward the digital transformation. Heidelberg is making
further progress in this regard. For example, the company is getting closer to
its goal of increasing the share of recurring revenues from subscription offers
to around one-third in the medium term. By the end of December, 13 percent of
the order backlog was already based on this kind of customer projects. When it
comes to innovation with a focus on autonomous, fully automatic printing,
Heidelberg will be presenting a new generation of offerings at the drupa 2020
trade show in June under the slogan "Unfold your Potential". One example is the
popular Speedmaster model with new "Plate to Unit" printing plate logistics to
further improve both cost-effectiveness and competitiveness in offset printing.
Initial customer orders in this profitable core business of the Group have
already been received. Heidelberg is convinced that the enhanced product
portfolio will enable it to further extend its market and technology leadership
in future-oriented software-based applications, intelligent user guidance, and
autonomous processes of integrated solution systems ("Smart Print Shop").

Preliminary nine-month figures of January 20, 2020 confirmed

As announced on June 20, 2020, Heidelberg recorded a stable development of sales
and incoming orders over the first nine months (April 1 to December 31, 2019) of
financial year 2019/2020. While incoming orders totaling EUR 1,900 million
almost reached the previous year's level of EUR 1,912 million, incoming orders
in the third quarter totaled EUR 636 million, up from EUR 606 million in the
previous year. Nine-month sales of EUR 1,690 million were virtually unchanged;
in the third quarter, however, sales fell from EUR 579 million to EUR 567
million as a result of the reluctance to invest in Europe caused by the economic
situation.

EBITDA excluding restructuring result was EUR 47 million in the third quarter,
compared with EUR 39 million in the same quarter of the previous year, thanks to
non-recurring income of around EUR 25 million from the sale of the company
Hi-Tech Coatings. On the other hand, lower volumes, pressure on margins in the
consumables trading business and regional shifts with a less favorable product
mix as well as high up-front expenditures in digital printing had a negative
impact on business. Cost-cutting measures could not compensate for this
development. In the first nine months, EBITDA excluding restructuring result was
EUR 117 million, compared to EUR 101 million in the previous year. Accordingly,
the result before taxes was slightly positive at around EUR 5 million (previous
year: EUR 1 million), while the result after taxes was slightly negative at EUR
-10 million (previous year: EUR -2 million). Free cash flow improved after nine
months to EUR -73 million (previous year: EUR -120 million), the equity ratio
was 13.6 percent. Net financial debt totaled EUR 389 million on the reporting
date, and leverage amounted to 1.9.

"We will streamline Heidelberg in organizational terms, divest non-core areas
and assets and thus significantly reduce our cost base. With the planned package
of measures, we see good potential for significantly improving liquidity and
balance sheet quality," added Marcus A. Wassenberg, the company's CFO.

Outlook for 2019/20 as a whole

On January 20, 2020, the company adjusted its forecast for the year as a whole
to reflect the challenging market conditions. The Management Board expects net
sales for the year as a whole to be slightly below the previous year's level of
around EUR 2.490 billion. EBITDA excluding restructuring result and excluding
the non-recurring income from the sale of Hi-Tech Coatings is expected to be in
a range of 5.5 to 6.0 percent of sales. The after-tax result will accordingly be
slightly negative. On the basis of the announced EBITDA range, the leverage,
including the effects of the first-time application of IFRS 16, should be around
2.

The company will publish its financial statements and annual report for 2019/20
on 9 June.

Image material and additional information about the company are available in the
Press Lounge of Heidelberger Druckmaschinen AG at www.heidelberg.com.

Heidelberg IR now on Twitter:

Link to the IR Twitter channel: https://twitter.com/Heidelberg_IR

On Twitter under the name: @Heidelberg_IR

Important note:

This press release contains forward-looking statements based on assumptions and
estimations by the Management Board of Heidelberger Druckmaschinen
Aktiengesellschaft. Even though the Management Board is of the opinion that
those assumptions and estimations are realistic, the actual future development
and results may deviate substantially from these forward-looking statements due
to various factors, such as changes in the macro-economic situation, in the
exchange rates, in the interest rates, and in the print media industry.
Heidelberger Druckmaschinen Aktiengesellschaft gives no warranty and does not
assume liability for any damages in case the future development and the
projected results do not correspond with the forward-looking statements
contained in this press release.

Contact:

Further information:

Corporate Communications
Thomas Fichtl
Phone: +49 6222 82-67123
Fax: +49 6222 82-67129
E-mail: Thomas.Fichtl@heidelberg.com

Investor Relations
Robin Karpp
Phone: +49 6222 82-67120
Fax: +49 6222 82-99 67120
E-mail: robin.karpp@heidelberg.com

Additional content: https://www.presseportal.de/pm/6678/4516905
OTS: Heidelberger Druckmaschinen AG
ISIN: DE0007314007

Original-Content von: Heidelberger Druckmaschinen AG, übermittelt durch news aktuell