Business News
schlott gruppe announces preliminary results for the second quarter and the first half of 2008/9
Wednesday 22. April 2009 - Value-added sales (VAS) 100.2 million in first half of 2008/9 after 115.1 million a year ago; Operating EBT H1 2008/9 -1.0 million after +0.5 million a year ago; Recession in Europe causing significant downturn in utilisation rate in Q2; increase in Q3 expected
schlott gruppe today announces its preliminary results for the 2008/9 second quarter and first six months ended March 31, 2009. On the back of what was essentially a satisfactory start to the new financial year, with the Group’s operational performance slightly exceeding expectations in the first quarter, the second quarter was impacted by prevailing recessionary trends. This prompted a significant decline in capacity utilisation and, in turn, tonnage.
Against the backdrop of lower capacity utilisation, value-added sales (VAS) contracted by 17.5 per cent to 44.3 million in the second quarter, compared to 53.7 million in the same period a year ago. In the first half of the 2008/9 financial year VAS amounted to 100.2 million, after 115.1 million a year ago. Group revenue stood at 89.0 million in the second quarter of the current financial year, compared to 102.8 million a year ago. For the first six months of the current financial year, revenue totalled 193.7 million, compared to 222.7 million a year ago. All figures have been adjusted for the deconsolidation of the sachsendruck subsidiary effective from November 1, 2008.
Despite further visible cost savings within the area of human resources as well as significant improvements in materials management, the Group was unable to offset fully within its earnings the substantial decline experienced in tonnage output, which was particularly evident in the months of February and March. Despite being buoyed – as was the case in the first quarter – by a favourable net currency result, operating EBT receded to -3.9 million in the second quarter, compared to -2.7 million a year ago, and -1.0 million in the first six months, after +0.5 million in the same period last year.
After restructuring expense of 6.3 million in the second quarter and first half of the previous year, follow-on restructuring expenses in the 2008/9 financial year amounted to 0.4 million in the second quarter and 0.6 million in the first half. Reported EBT thus amounted to -4.3 million in the second quarter of 2008/9, compared to -9.0 million in the same period a year ago, and -1.6 million in the first half, after -5.8 million last year.
The print segment generated VAS of 43.6 million in the second half of the current financial year, compared to 52.8 million a year ago. After the first six months, VAS totalled 98.4 million, compared to 113.3 million. Segment operating EBT stood at -3.3 million in the second quarter, after -1.6 million last year, and 0.8 million in the first six months, compared to 2.5 million in the same period a year ago. Within this context, the significant decline in capacity utilisation and tonnage had a severe impact on the performance of the segment as a whole: in the second quarter the Group printed 119.1 thousand tonnes of paper, 17.9 per cent or 25.9 thousand tonnes less than in the same period a year ago. The corporate services segment, whose activities are restricted to providing intragroup services, remained in line with targets.
As regards the Group’s business performance during the remainder of the current financial year, the emphasis in terms of cost structures will be on unlocking additional savings potential: negotiations relating to staff measures at the Group’s Hamburg site, where an agreement governing the retention of jobs had been in place until the end of 2008, have now been concluded. Machine capacity will be reduced from 6 to 4.5, and, by the end of 2009, some 60 employees at this facility will be laid off. The Group is also assessing the possibility of introducing short-time work at all locations, or implementing such measures where agreements have been reached and authorisation has already been granted. Additionally, schlott gruppe is pursuing further improvements with regard to purchasing.
The calculations underlying schlott gruppe’s forecasts for 2009 were based on the assumption of sluggish economic performance in the relevant sales markets. In particular, the beginning of the 2009 calendar year, which coincides with the Group’s weakest second quarter from January to March, was expected to produce the most severe slump in business. While this outlook proved correct in terms of the general direction of business trends, the downturn was in fact more substantial than previously anticipated, as reflected in the extremely lacklustre performance in February and March. Against this backdrop, the uncertainties associated with VAS and EBT projections for the annual period 2008/9 as a whole would appear to be even more tangible than in the past, and therefore it is impossible to provide an outlook with any degree of certainty.
Having said that, there is evidence to suggest that, unlike other sectors of the economy, the printing industry has not yet experienced a full-scale collapse in demand. Overall, purchasing patterns are sluggish – in line with the normal seasonality of business. However, they essentially remain unchanged. Therefore, schlott gruppe anticipates a noticeable increase in capacity utilisation in the course of the third quarter.
schlott gruppe will report their final figures including the balance sheet for the second quarter and the first six months of the current financial year on May 6, 2009.