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Heidelberg Reports Incoming Orders Increased in Third Quarter

February 9, 2010
HEIDELBERG, GERMANY—02/09/2010—In the third quarter of financial year 2009/2010 (October 1 to December 31, 2009), incoming orders and sales at Heidelberger Druckmaschinen AG (Heidelberg) were up on the previous quarters. The savings resulting from the package of cost-cutting measures have helped to significantly reduce the operating loss over the past three months. Due to mixed economic expectations around the globe, however, there is as yet no clear improvement in the level of investment in the print media industry.

• Q3 incoming orders up on previous year at EUR 609 million
• Q3 operating result, excluding special items, of EUR -13 million
• Positive free cash flow of EUR 3 million in Q3

Incoming orders in the third quarter of financial year 2009/2010 amounted to EUR 609 million, 14.7 percent up on the previous quarter's level of EUR 534 million and roughly nine percent higher than the figure for the same quarter the previous year (EUR 560 million). This was the highest level for five quarters. Incoming orders after nine months (April 1 to December 31, 2009) totaled EUR 1.693 billion (previous year: EUR 2.432 billion). A key factor in the previous financial year was the volume of orders resulting from the drupa trade show in May 2008.

"Incoming orders and sales were slightly up in the third quarter," stated Heidelberg CEO Bernhard Schreier. "We achieved some fairly notable business successes, particularly in China and Germany. We have increased our market share with our new large-format presses. There is currently no sign of a significant recovery, though, because generally speaking print shops around the globe are still reluctant to invest," he added.

At EUR 578 million, sales in the third quarter matched the highest level to date for the current financial year. Services accounted for just under 30 percent of this figure. Sales were EUR 79 million higher than the previous quarter's figure of EUR 499 million but 23 percent down on the same quarter the previous year, when they totaled EUR 750 million. They were also 28 percent lower than during the equivalent nine months the previous year, totaling EUR 1.591 billion (previous year: EUR 2.211 billion).

The Heidelberg Group's order backlog at the end of the third quarter improved slightly to EUR 626 million (previous quarter: EUR 617 million).

Much better earnings
At EUR -13 million, the operating result for the third quarter, excluding special items, was much better than the previous quarter's figure of EUR -65 million. This was due in large part to the slight increase in sales and the growing savings resulting from the package of cost-cutting measures. Following agreement on a reconciliation of interests with employee representatives in October 2009, it was possible to reverse parts of the provisions for the cost-cutting program. This resulted in income of EUR 30 million from special items in the third quarter and produced a positive operating result, including special items, of EUR 17 million for this quarter. The cumulative operating result after nine months, excluding special items, was EUR -141 million (previous year, excluding special items: EUR -45 million).

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