KBA Profits from Strong Standing in Niche Markets
Exports account for around 85 percent of group sales
A 28 percent jump in domestic sales trimmed the export level to 84.6 percent. The volume of group sales generated in the rest of Europe rose from 30.3 percent to 36.1 percent, and in North America from 9.7 percent to 10.4 percent. The figure for Asia and the Pacific remained high at 26.7 percent. Latin America and Africa accounted for 11.4 percent of total group sales, which is closer to their historical average than the prior year’s 21 percent.
Higher cash flow and solid finances
Cash flows from operating activities swelled from €11.6 million a year before to €64.6 million following an increase in customer prepayments and a drop in trade receivables. This more than covered cash flows for investing activities and raised the free cash flow to €40.7 million. Funds totalling €128.1 million and ample credit lines, underscore KBA’s strong financial position. Compared to the higher balance sheet total the group’s equity ratio was a sound 36.7 percent.
Targeted reduction in group payroll to 6,000
At the end of September there were 6,446 employees on the group payroll, just a few more than in 2010 even though three subsidiaries were consolidated in January. Once the capacity adjustments at KBA’s web press plants have been completed the group will have a payroll of around 6,000. A new intake of apprentices and student trainees in the autumn raised their number from 419 to 433, and the training ratio from 6.5 percent to 6.7 percent.
Outlook for 2011
Management is confident that a surge in sales of high-margin products in the fourth quarter will enable KBA to post the moderate increase in group sales (2010: €1.18bn) that was projected in the spring. Claus Bolza-Schünemann, KBA’s new president and CEO since 1 November, confirmed that the group is targeting a pre-tax profit for the third year in succession. KBA would thus be the absolute exception in a press engineering sector that is being rocked by wrenching structural change.