However, although capital spending on new plant by the global print industry finally showed signs of picking up, a drop in shipments of web presses in the first half-year caused an 18.6per cent drop in group sales to €808.8m for the nine months to September 30.
Lower profit contributions from a diminished business volume, a big increase in research and development costs in the run-up to drupa 2004, and restructuring provisions for a capacity downsize at KBA’s web press production plants resulted in a pre-tax loss of €40.9m (2002: €35.7m profit) and a net loss of €26.2m (2002: €0.5m profit). The cash flow from current business activities totalled €40.9m, well above the prior year figure of a €19.6m loss.
The demand for sheetfed offset presses remained buoyant. Year on year, the volume of new orders climbed by 13.2per cent to €482.2m. Sales in the first nine months totalled €422.5m, only slightly below the €448.2m posted in 2002, and fourth-quarter sales are expected to be even higher as shipments increase.
For the first time in 30 months there was a visible increase in new orders for web and special presses, a division KBA says was badly hit by the economic downturn. The inflow of orders in the nine months to September 30 swelled to €372.1m, or seven per cent more than for the same period in 2002 (€347.7m). Sales, however, slid to €386.3m, 29.2 per cent below the prior year figure of €545.6m. They will fall short of the 2002 annual total despite a higher volume of shipments in the fourth quarter.
Nonetheless, KBA holds to its group sales objective of €1.2bn-plus for 2003. However, the reduction in output at its web press production plants in the first six months and the high outlay for remedial measures, in conjunction with unfavourable exchange rates and competitive price constraints, means that KBA is expecting a double-digit loss for the year.
For 2004 the group anticipates substantial higher sales and earnings in line with increased plant utilisation at its web press facilities, particularly if, as expected, the global economy experiences a sustained recovery. The drupa trade fair scheduled for May next year should also stimulate sales.