Press sales plummet impacts on Heidelberg

The next two years of business are expected to be rocky for Heidelberg, which forecast an 11 per cent decline in sales for the 2008-09 financial year.

In the first six months of the financial year 2008-09, Heidelberg managed to match the previous year's incoming orders thanks largely to drupa, but during the second quarter, incoming orders fell sharply by 23 per cent.  Continuing financial crisis and the resultant global uncertainties were listed as contributing factors.

CEO, Bernhard Schreier, (pictured) has plans to keep Heidelberg afloat in a choppy and ever-changing environment.

"We are working harder and faster to adapt our structures and costs to the gloomy economic forecasts and the industry's reluctance to invest," he said. "We are sticking with our strategic approach and our comprehensive range of products and services. We need to use the measures initiated to stabilise the earnings situation until there is an improvement in the overall economic climate."

Andy Vels Jensen, managing director for Heidelberg Australia and New Zealand confirmed that things were no better locally.

"At this point in time we don't expect any further major cut-backs but in these uncertain times, who knows," he said.

Vels Jensen also said it was difficult to predict the future for both Heidelberg and the world at large, though he did envision a number of difficulties that the company needs to combat.

"We expect the industry to go through an even more difficult patch during the first-half of the new calendar year when the combination of increasing costs, reduced value of the Australian dollar and seasonally slow period will have a full impact on businesses," he said. "Increased consolidation is a foregone conclusion. We don't expect business to improve significantly before 2010."

These sentiments were echoed in a media statement from the company which stated that "the management board does not currently expect any change for the better given the current developments."

The operating result of the Heidelberg Group in the second quarter of financial year 2008/2009 was well into negative figures at -50 million Euro (previous year: 70 million Euro). This result includes special items totaling 40 million Euro, among them a EUR 22 million provision from the collective labor agreement for partial retirement and the outlay for the package of cost-cutting measures. After adjustments for special items, the operating result for the second quarter was -10 million Euro. Falling sales and the low profit contributions, the start of series production for new products, higher raw material prices, and the remaining costs for drupa all burdened results during the second quarter.