MAN Group chairman fires rumors of MAN Roland sheetfed press sell-off

According to a report on www.whattheythink.com answers he gave at the annual general meeting fuelled rumor that a sell off of the sheetfed division of MAN Roland to a financial investor is an option being considered in the face of a Euro 37 million loss for the Printing Division of the company.

A spokesman for Man Roland later said that Rupprecht’s statements have been taken out of context. “There is no plan to spin-off MAN Roland’s Sheetfed Division. In answering analysts’ questions, Mr. Rupprecht was simply making the point that no business unit is sacred and each must perform profitably. We anticipate no change in MAN Roland’s product mix in the foreseeable future," he said.

The speculation came as MAN Roland braced itself for further job losses as orders with weak profit margins take the shine off better than expected drupa business. There will be a further reduction of around 500 jobs, mainly in Denmark, following the amalgamation of manufacturing facilities.

In his report Rupprecht said the market situation in the Printing Machines sector remained extremely weak throughout 2003. Publishers and printers were operating on low margins, surplus capacity dominated the market and many printers provisionally postponed scheduled investments. This resulted in a very slow demand for printing systems. Due to a recovery at year-end, the company was able to marginally increase its order intake compared with 2002, but sales again fell significantly, in line with the lower order backlog.

“In spite of introducing fundamental cost-cutting measures, most notably at the sheet-fed sites in the Rhine-Main area, we were unable to prevent the Printing Machines Division slipping into the red with overall pre-tax earnings of minus 37 million euros. By consistently pursuing our schemes to revive the sheet-fed business, mainly by amalgamating works in the Offenbach area, introducing cost-saving measures and last, but not least, taking advantage of the return to more encouraging order-intake figures registered since the drupa trade fair, which considerably exceeded our expectations, we have justified hopes that Printing Machines will be able to move back into the black in the course of this year.

MAN Roland took orders of over 470 million euros at drupa in what Rupprecht described as “surprisingly brisk activity.” This enabled the company to register a total figure of 645 million euros, 14% higher than the order intake at this time last year, even though business stagnated at a low level up until April.