Heidelberg sees June pick-up in Covid hit
The world’s biggest press manufacturer Heidelberg has eased its debt and sold off a non-core asset, revealing its first quarter orders had taken a hit with Covid, but picked up in June and July.
First quarter figures had Heidelberg back in the black with a €5m net result after taxes, compared to the €31m loss at the same stage last year. However, in the three months to June – the Covid quarter – incoming orders were down by almost half to €346m, while sales slumped by a third, falling from €520m to €330m.
Heidelberg said June had seen improved results that had continued during July. It said its press monitoring data highlighted an uptick in activity, saying, “This data clearly shows that business in China – the biggest single market for Heidelberg – is picking up speed and is already surpassing last year’s level. Other markets are also showing the first signs of recovery in terms of print volumes, which is cause for cautious optimism as regards the second half of the financial year.”
Heidelberg expects to be loss-making for the full year, but “significantly better” than in 2019-20, when it recorded a whopping €343m loss.
Meanwhile, Heidelberg sold its label sector MIS developer CERM back to its management nine years after it was acquired for €8m. It also used the cash from its €120m sale of Gallus to Benpac to pay down a high interest loan, saving itself $12m a year.
The company has also been attacking its debt, with €380m coming into the business thanks to the release of funds from the Heidelberg Pension Trust.
“We are keeping our word and are working full speed ahead to consistently implement the measures announced in the program we presented in March to increase profitability, competitiveness and to secure our future. The early repayment of the high-yield bond is a further milestone in improving our financing structure. We are permanently freeing ourselves from high interest payments and are becoming more financially independent and flexible,” Marcus Wassenberg, CFO of Heidelberg, said.