Heidelberg posts growth in the first half of 2022

Print, packaging solution segments record increase in sales

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Heidelberg has improved its sales and result for the first half-year of 2022.
Heidelberg has improved its sales and result for the first half-year of 2022. Heidelberg has improved its sales and result for the first half-year of 2022.

Heidelberger Druckmaschinen (Heidelberg) continued its strong start to the year in the second quarter and has significantly improved its sales and result for the first half-year. Partly due to the exchange rate situation, for instance, sales climbed to 590 million Euros in the second quarter.

At 1,120 million Euros, sales for the first half-year are around 14% percent up on the previous year. The packaging solutions segment enjoyed particularly strong growth, from a modest 415 million Euros in the previous year to 535 million Euros. Due to the higher sales, EBITDA improved to 68 million Euros in the second quarter. This exceeded the previous year’s figure of 38 million Euros, which was adjusted for non-recurring income (unadjusted figure: 60 million Euros).

A better price quality of sales that countered the substantial increases in the costs of raw materials and intermediate products contributed to the higher EBITDA, which reached 104 million Euros for the half-year (previous year’s (unadjusted) figure: 75 million Euros). The net result after taxes after six months climbed from 13 million Euros to 44 million Euros, increasing from 27 million Euros to 39 million Euros in the second quarter. Just six months into the year, this exceeds the level for the whole of the previous year.

In the second quarter, incoming continued rising, to some 622 million Euros(up 5%). This was supported by currency effects, and by high demand from Central Europe and North America. Half-year incoming orders reached 1,229 million Euros, as a result of which the order backlog is above 1 billion Euros for the first time in years. This high order backlog and the half-year figures create an excellent basis to achieve the targets for the year as a whole. In the second half-year, however, Heidelberg is expecting further increases in personnel and energy costs in particular.

Despite a difficult environment, we have successfully overcome the challenges in the first half-year and achieved further growth. We remain cautious, though, because it’s not yet entirely clear how the global situation will develop,” said the company’s CEO, Ludwin Monz. “During the first half-year, Heidelberg has laid a good foundation for achieving our financial targets. With this in mind, we are focusing on maintaining our supply chains, safeguarding our margin through higher sales prices, and continuing our cost discipline,” he added.

Forecast for 2022/23

Heidelberg stands by its forecast for the financial year 2022/23. The company continues to expect sales figures to increase to around 2.3 billion Euros (2021/22: 2.183 billion Euros), provided there is no significant downturn in the general economic environment. Despite the cost increases that can be expected, profitability is set to improve in the second half-year.

Heidelberg is still predicting a further rise in the EBITDA margin to at least 8 percent for the 2022/23 financial year (2021/22: 7.3 percent). The net result after taxes is also expected to climb slightly compared to 2021/22 (33 million Euros).

Strong growth in packaging, printing

The print and packaging solutions segments increased their sales in the first half-year. Packaging enjoyed particularly strong growth of just under 30 percent, following more modest progress in the previous year. Technology solutions, which is responsible for the company’s wallbox business, was unable to continue the previous year’s exceptional growth in both incoming orders and sales. Together with the end of funding for private charging stations in Germany, longer delivery times for new electric cars had a particular impact. This resulted in weaker growth in the short term and will continue to have a slight weakening effect for the time being.

Low net financial debt

After six months, the free cash flow amounted to –13 million Euros(previous year: 74 million Euros). This lower figure is mainly due to the usual production-related increase in inventories. As expected, revenues from the sale of assets in the first half-year also fell. Due to the slightly negative free cash flow, the half-year net financial debt was 23 million Euros and therefore remained at a low level (March 31, 2022: –4 million Euros).

We are seeing that the transformation is having an impact, and Heidelberg is in good shape for the future. In the first half-year, we were able to further improve our baseline,” said CFO Marcus A Wassenberg. “Our low net financial debt and improved equity ratio place us on a stable footing,” he concluded.

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