KBA Posts Pre-tax Profit in Third Quarter as Incoming Orders Spike
Big improvement in capacity utilization
The group order backlog on Sept. 30, 2010 was worth €564.1 million, a 26.3 percent gain on the prior-year figure of €446.5 million. At €208.2 million, the volume of unfilled orders in the sheetfed division will keep it busy for a good few months, while the backlog of orders for web and special presses climbed to €355.9 million, raising the level of plant utilization in this division, too.
At the end of September there were 6,437 employees on the group’s payroll, 658 fewer than at the same time last year. Since the financial crisis broke in summer 2008 it has shed around 1,700 jobs. Even so, to maintain the high standard of technological skills necessary in the international printing press market KBA took on 419 apprentices and interns at the beginning of the new academic year, raising its training level from 5.8 percent to 6.5 percent. For the past 140 years the world’s oldest press manufacturer has run a government-approved training school at its main plant in Würzburg.
Finances and balance sheet outperform industry average
Notwithstanding an increase in working capital to support a bigger turnover in the fourth quarter, higher earnings and payments received helped to swell cash flows from operating activities to €11.6 million (2009: €9.5 million). This was much better than the half-year figure of €-18.1 million. Following investment payments the free cash flow came to €0.4m (2009: €-4.6 million). Alongside access to ample credit lines the group had funds amounting to €67.9 million. Its net financial position remained positive at €24.7 million, due in part to a reduction in bank loans to €43.2 million. Despite a €69.6m increase in the balance sheet total to €1,130 million the equity ratio was an above-average 37.3 percent.
Export level rises to 87.8 percent
The export level rose to an exceptionally high 87.8 percent. The proportion of group sales generated in the rest of Europe (30.3 percent) was well below the pre-crisis level, having slipped from 34.8 percent last year. The same applied to North America (9.7 percent). By contrast, sales to Asia and the Pacific accounted for 26.8 percent (2009: 23.5 percent) of the Group total, largely thanks to brisk demand from China. The figure of 21 percent for Africa and Latin America was also much higher. On the whole, KBA’s sales distribution reflects major regional differences in global market activity.