This, coupled with extraordinary expenses relating to drupa in the second quarter, will result in a group loss being posted in the official interim report due to be issued in mid-August. The improvement in sales and earnings will work its way through to the bottom line in the second half of the year.
Group sales in 2003 fell nine per cent to EUR1.23bn due to a general lack of demand. Weaker sales and the cost of restructuring the web press division resulted in a group loss of EUR30m last year. Since dividends are based on the performance of the parent company, Koenig & Bauer AG, which posted a slightly higher loss of EUR38.7m, management was unable to propose the payment of a dividend for the first time since the company went public in 1985.
However, Bolza-Schünemann says higher shipments in the second half of the year will lift group sales to around EUR1.4bn – the highest in KBA’s 187-year history. Although exports and margins have been hit by ongoing pressure on prices for new and used machinery, by the high cost of steel, the strong euro and wage inflation, KBA is targeting a return to profit in 2004.