March 2008 May Océ N.V.

Transcription

1 Mrch 2008 My 2008 Océ N.V. P.O. Box 101, 5900 MA Venlo, the Netherlnds, phone Trde register Venlo number Océ investor informtion on internet: Printing for Professionls

2 Qurterly report 2008/2 Océ counters dverse economic conditions by expnding svings progrm Results second qurter 2008* Key figures Second qurter First hlf yer In million / s % Δ Δ Totl revenues % 1, , % EBITDA % % Operting income [EBIT] % % Normlized operting income** % % Net income % % In per shre EBITDA % % Net income ttributble to holders of ordinry shres * The figures in this report re unudited. ** Adjusted for one-off items % % Highlights: Revenues down due to economic developments nd exchnge rte effects Gross mrgin, excluding one-off items, increses to 40.2% [2007: 39.7%] Operting income, excluding one-off items, 20.2 million [2007: 29.6 million] Svings progrm further expnded Comments by Rokus vn Iperen, chirmn of the Bord of Executive Directors: The dverse economic conditions gin impcted our mrkets in the second qurter nd therefore ffected our results. Sles of continuous feed systems decresed, due in prt to developments in the finncil sector. The slowdown in the construction sector in the United Sttes is continuing nd is now lso mking itself felt more in Europe. In this segment we sold fewer wide formt printers thn in the sme period of lst yer. A positive fctor is tht we were ble in the second qurter to continue to grow in the office nd printroom mrket, the wide formt grphics mrket nd in Business Services. This growth results from our strtegy of continuously investing in strengthening our distribution power nd in n innovtive nd competitive product portfolio. The improvement of our business processes nd the resultnt reduction in our costs is the third min thrust of our strtegy. The svings progrm nnounced in April will reduce the costs in 2008 by 80 million. In the first hlf of 2008 svings of 20 million were chieved. Of the reduction of 350 jobs tht ws nnounced in April, 80% hs menwhile been completed. In response to the economic sitution nd elborting on the progrm of 2008, we hve identified in the pst period further possibilities for cost svings, which will led to n dditionl decrese in costs of 50 million in As prt of these svings bout 600 extr jobs will be discontinued. We hve strted on the implementtion of this. Pge 2

3 Qurterly report 2008/2 Key figures per Strtegic Business Unit In million / s % DDS OBS WFPS Totl Revenues Orgnic growth in revenues 4.8% 5.4% 1.0% 2.3% Orgnic growth in non-recurring revenues 9.2% n/ 2.8% 5.3% Orgnic growth in recurring revenues, excluding fx 0.7% 5.4% 2.9% 0.1% Operting income Normlized operting income* * Adjusted for one-off items. Summry of second qurter 2008 Adverse economic conditions nd foreign exchnge rte effects gin impcted our mrkets in the second qurter nd therefore ffected our results. Océ s revenues decresed orgniclly in the second qurter by 2.3% [excluding fx by 1.7%]. This decrese ws minly cused by decline in nonrecurring revenues, whilst recurring revenues, excluding fx, remined virtully the sme on n orgnic bsis. Customers of the Strtegic Business Unit [SBU] DDS postponed bigger investments in continuous feed systems, due in prt to developments in the finncil sector. In the office mrket nd the printroom mrket DDS grew thnks to the success of the Océ VrioPrint 6000 series, the color printers of Konic Minolt nd the strengthening of our sles orgniztion in Europe. Also in the present economic sitution the SBU OBS gin chieved n orgnic increse in revenues. The slowdown in the construction sector continued, with the result tht the SBU WFPS sold fewer printers in this mrket. In the grphics mrket WFPS incresed its revenues thnks to sles of the Océ Arizon 250 GT vi its own orgniztion nd vi Fujifilm. The normlized operting income mounted to 20.2 million. The decrese s compred to 2007 is principlly ttributble to lower revenues nd exchnge rte effects. Océ is implementing svings progrm of 80 million, of which 20 million hs menwhile been relized in the first hlf of Svings of 60 million will be chieved in the second hlf of this yer. In response to the economic sitution nd following creful nlysis, supplementry svings progrm hs been drwn up of 50 million in 2009, involving the discontinution of 600 jobs. The expected one-off totl restructuring costs will mount to 45 million in 2008 nd 20 million in Pge 3

4 Qurterly report 2008/2 Results Océ Group The very strong euro, which rose in the second qurter ginst the US dollr [15%] nd the Pound sterling [15%], hd substntil impct on results. Totl revenues in the second qurter mounted to million. On n orgnic bsis the decrese ws 2.3% [including exchnge rte effects 9.3%]. The shre of color continues to grow nd now ccounts for 25% of revenues [2007: 18%]. We chieved this growth through our strong color product portfolio consisting of our own nd prtner products. Non-recurring revenues decresed orgniclly by 5.3% [including exchnge rte effects by 11.5%]. Recurring revenues, excluding fx, remined virtully the sme on n orgnic bsis [ 0.1%; including fx 0.9%]. If the fx ctivities nd exchnge rte effects re included, recurring revenues decresed by 8.4%. Océ incresed gross mrgin, excluding one-off items, to 40.2% [2007: 39.7% 1] ]. Including one-off items, gross mrgin mounted to 39.1%. Operting expenses mounted to million [2007: million]. After djustment for exchnge rte effects, operting expenses remined prcticlly unchnged, despite the one-off items nd the expnsion of the Europen direct sles orgniztion for the office segment. On blnce, normlized operting income decresed to 20.2 million [2007: 29.6 million]. Of this decrese 5 million ws cused by exchnge rte effects, fter hedges. Including one-off items, operting income mounted to 9.2 million. Of the one-off items, the greter prt [ 12.0 million] ws incurred to implement the svings progrm of 80 million in ] In 2008 nd in the comprtive figures for 2007 the trnsporttion costs from distribution center to customer re fully included in the gross mrgin. Second qurter In million Operting income Reorgniztion costs Sle of ODT 1.0 Normlized operting income * Cpitlized R&D costs [net] * Adjusted for one-off items. Finncil expenses [net] mounted to 9.2 million [2007: 8.7 million]. These expenses comprise chnge of 1.8 million in the option vlue of the finncing preference shres. Txtion ws negtive nd contributed 5.5 million to net income [2007: million]. On blnce, net income decresed to 5.5 million [2007: 18.3 million]. Ernings per ordinry shre ttributble to shreholders decresed to 0.05 per shre [2007: 0.21]. Blnce sheet, RoCE nd csh flow By comprison with the second qurter of 2007 the blnce sheet totl decresed t the end of the second qurter 2008 to 2,414 million [2007 second qurter: 2,611 million] reflecting the reduction in ccounts receivble, the sle of fixed ssets nd exchnge rte effects. The net debt/ebitda rtio mounted to 1.9 [2007: 2.2], which mens tht it is slightly lower thn the sought-fter bndwidth of 2 to 2.5. Net Cpitl Employed t the end of the second qurter ws 1,244 million [2007 second qurter: 1,394 million]. In reltion to normlized operting income the RoCE mounted to 6.8% [2007: 6.6%]. Free csh flow in the second qurter ws 3 million [2007: 12 million]. Csh flow from operting ctivities ws 35 million [2007: 38 million]. Pge 4

5 Qurterly report 2008/2 Results of SBUs Digitl Document Systems [DDS] Revenues in DDS mounted to million. Orgniclly, revenues decresed by 4.8%. The shre of color incresed to 22% of revenues [2007: 15%]. Non-recurring revenues decresed orgniclly by 9.2%. In the office segment we ccelerted the growth in revenues. This ccelertion ws chieved through n expnsion in the number of sles stff in Europe nd through the vilbility of the full product portfolio of Konic Minolt. Sles were lso higher in the printroom segment, notbly for the Océ VrioPrint 6000 series nd the color printers of Konic Minolt. Sles of continuous feed systems decresed, prtly becuse of developments in the finncil sector, which we hd lredy reported in the first qurter. Our mrket position remins strong nd DDS booked severl importnt nd substntil orders. Direct Group, leder in direct mrketing in the United Sttes, bought 47 printers in the second qurter, including the recently introduced Océ VrioStrem 8750 nd the Océ JetStrem 2200 in ddition to the Océ VrioPrint Some of these mchines were delivered in the second qurter. In ddition Océ in the United Kingdom sold GBP 3.8 million worth of blck-nd-white nd color continuous feed printers to T-Systems, subsidiry of Deutsche Telekom. These printers form the core of two new print centers which together hve printing cpcity of 500 million A-4 sheets per yer. These systems will be delivered in the third nd fourth qurter. In the second qurter recurring revenues, excluding fx nd the effect of the sle of ODT in Jnury 2008, were in line with those of lst yer on n orgnic bsis [including fx nd ODT 2.3%]. The shre in recurring revenues of the color printers nd the Océ VrioPrint 6000 series incresed gin. Normlized operting income mounted to 0.4 million [2007: 0.3 million]. Including one-off costs the result mounted to 5.6 million. Océ Business Services [OBS] Revenues in OBS mounted to million. Orgnic growth ws 5.4%. OBS continues to grow in view of the fct tht, despite more difficult economic conditions, customers re still outsourcing their document ctivities. In the United Kingdom OBS is tking over printing nd distribution ctivities for the Cmbridge Assessment Group, one of the world s leding exmintion institutes. This ssignment hs durtion of 5 yers, represents totl vlue of GBP 40 million nd will strt to contribute to revenues lter this yer. Operting income mounted to 2.5 million [2007: 4.4 million]. The decrese is mong others due to higher costs involved in the strt-up of mjor projects with new customers. Wide Formt Printing Systems [WFPS] Revenues in WFPS mounted to million. On n orgnic bsis the decrese ws 1.0%. The shre of color incresed to 32% of revenues [2007: 27%]. The slowdown in the construction sector in the United Sttes is continuing nd is now becoming more visible in Europe. As result WFPS sold fewer wide formt printers in this segment thn in the previous yer. In the wide formt grphics mrket WFPS expnded revenues thnks to the strong product portfolio nd the Océ Arizon 250 GT in prticulr. On blnce, non-recurring revenues incresed orgniclly by 2.8%. Recurring revenues decresed by 2.9%. Tht resulted chiefly from lower print volumes in the design engineering mrket nd fewer Imging Supplies deliveries. Aginst this, however, there ws n increse in recurring revenues from the Océ Arizon 250 GT popultion. Normlized operting income ws 17.2 million [2007: 24.9 million] s result of higher R&D expenditure nd extr costs for the strt-up of the Océ ColorWve 600. Including one-off items the result ws 12.3 million [2007: 24.7 million]. Pge 5

6 Qurterly report 2008/2 Strtegy Océ s strtegy is focused on three min thrusts: boosting distribution power, offering competitive products nd improving business processes. One of the strtegic mrkets is the grphics sector. At the end of My/erly June the four-yerly drup ws held, the trde fir for the grphics mrket. This is by fr the biggest trde fir in this industry in the world. The drup fir brought confirmtion tht customers nd suppliers shre the sme vision s regrds more fr-reching digitiztion of the grphics mrket. The greter proportion of the print volume world-wide is currently hndled by conventionl nlog printing presses. Only 12% of the volume is printed using digitl techniques. Digitl printing techniques hve strongly improved in recent yers, resulting in better print qulity nd lower costs. They lso offer mjor benefits such s the opportunity for personliztion nd print-ondemnd. This is why n incresing volume is not being produced on nlog mchines but digitlly. In terms of distribution power nd product portfolio, DDS nd WFPS re well positioned to help customers mke the trnsition to digitl printing. If customers mke investments despite the current dverse economy, then their investments re in digitl technology, which is focused on the future. Digitl Document Systems DDS hs n excellent sles nd service orgniztion tht is specilized in providing support for high volume printers. Besides this, DDS hs strong product portfolio which lso includes the color printers of our strtegic prtner Konic Minolt nd the Océ VrioPrint 4000 nd 6000 series. Other mchines on disply t drup were the Océ JetStrem 750, 1500 nd These printing systems enble full color printing t speeds of 714 to 2,865 ppm, the highest speed currently vilble in the mrket. At the drup trde fir this product series ttrcted gret del of ttention, s did the Océ ColorStrem Wide Formt Printing Systems WFPS hs the most extensive direct distribution power in wide formt in the digitl printing industry. This distribution strength hs been further enhnced in the grphics mrket following the cquisition of the French compny Intersoft, distributor of printers, scnners nd print medi tht focuses on promotionl mteril in retil chins. In ddition, Intersoft develops nd sells specilized workflow softwre tht enbles promotionl cmpigns to be implemented fster nd t locl level. WFPS hs very strong product portfolio for the wide formt grphics mrket. At the drup trde fir WFPS nnounced tht its product portfolio would be further strengthened by dding the Océ Arizon 200 GT nd Roll Medi options. The Océ Arizon 200 GT is eminently suitble for customers with lower print volumes who still wnt the sme qulity s the successful Océ Arizon 250 GT. Océ hs lso lunched the innovtive Océ CrystlPoint color technology, fundmentlly new nd environmentlly friendly technology tht combines the benefits of toner nd inkjet. The first product to incorporte Océ CrystlPoint technology, the Océ ColorWve 600, is wide formt color system tht is twice s fst s competitive systems. It ws greeted with gret enthusism by our customers. The required time to rmp up production mens tht the impct of the Océ ColorWve 600 on revenues will become visible only t the end of Improvement of business processes As its third strtegic thrust Océ is improving its business processes, which enbles it to reduce its cost bse. The svings progrm tht ws nnounced in April this yer will bring down costs by 80 million in These svings re being relized vi three types of inititives: corporte excellence projects, reduction in out of pocket expenses nd cutbck in the number of jobs. Of the nnounced reduction of 350 jobs, 80% hs lredy been relized. In response to the economic sitution nd elborting on the progrm of 2008, further costs Pge 6

7 Qurterly report 2008/2 svings hve been identified. Océ will reduce costs dditionlly by 50 million in This will led to the loss of round 600 jobs. We will implement this reduction in creful nd structured mnner nd it will be focused on ll countries nd disciplines, with the exception of sles. All svings referred to bove re exclusive of volume effects, infltion nd restructuring chrges. The expected one-off totl restructuring costs will mount to 45 million in 2008 nd 20 million in Outlook 2008 The Océ strtegy, bsed on strengthening distribution power, full-line nd competitive product portfolio nd optimizing the business processes re continued unbted. We re of the opinion tht this strtegy nd the dditionl mesures we re tken to reduce costs will enble us to counter the impct of the dverse economic conditions s much s possible. In view of the uncertin economic sitution we re not giving ny forecst for the results for the full 2008 finncil yer. Bord of Executive Directors Océ N.V. For further informtion: Investor Reltions: Crlo Scheken, Vice President Investor Reltions Phone , e-mil investor@oce.com Press: Jn Hol, Senior Vice President Corporte Communictions Phone , e-mil jn.hol@oce.com Keys to terminology: Non-recurring revenues: revenues from the sle of mchines, softwre nd professionl services. Orgnic growth: the development of the results fter djustment for exchnge rte effects nd the impct of substntil cquisitions or disposls. Recurring revenues: revenues from services, inks, toners, medi, rentls, interest nd business services. RoCE: Return on Cpitl Employed: operting income on n nnul bsis fter normlized txes [20%] s percentge of verge Net Cpitl Employed [totl ssets excluding csh nd csh equivlents, less non-interest bering libilities djusted for derivtives.] Wide Formt printing: wide formt printing [bigger thn A3]. Pge 7

8 Qurterly report 2008/2 Consolidted Income Sttement Second qurter First hlf yer In million Totl revenues , ,506.3 Cost of sles Gross mrgin Selling nd mrketing expenses Reserch nd development expenses Generl nd dministrtive expenses Other income Operting expenses Operting income Finncil income Finncil expenses Shre in income of ssocites Income before income txes Income txes Net income Net income ttributble to Shreholders Minority interest Free csh flow Averge number of ordinry shres outstnding [x 1,000] 84,774 84,098 84,758 84,055 Ernings per ordinry shre for net income ttributble to shreholders in Bsic Pge 8

9 Qurterly report 2008/2 Consolidted Blnce Sheet My 31, 2008 November 30, 2007 In million Assets Non-current ssets Intngible ssets Property, plnt nd equipment Rentl equipment Investments in ssocites 2 2 Deferred income tx ssets Avilble-for-sle finncil ssets 9 9 Derivtive finncil instruments 2 5 Trde nd other receivbles ,259 1,281 Current ssets Inventories Derivtive finncil instruments Trde nd other receivbles Current income tx receivbles 13 8 Csh nd csh equivlents ,145 1,199 Non-current ssets held for sle Totl 2,414 2,491 Equity nd Libilities Equity Shre cpitl Shre premium Other reserves Retined ernings Net income ttributble to shreholders Equity ttributble to shreholders Minority interest Non-current libilities Borrowings Derivtive finncil instruments Retirement benefit obligtions Trde nd other libilities 7 12 Deferred income tx libilities Provisions for other libilities nd chrges ,010 1,041 Current libilities Borrowings Derivtive finncil instruments 3 1 Current income tx libilities Trde nd other libilities Provisions for other libilities nd chrges Totl 2,414 2,491 Pge 9

10 Qurterly report 2008/2 Consolidted Sttement of Chnges in Equity ttributble to shreholders In million First hlf yer 2008 Finncil yer 2007 Blnce t December 1, 2007 / Net income ttributble to shreholders Dividend Shre-bsed compenstion 1 13 Purchse of tresury shres Csh flow hedges 2 3 Currency trnsltion differences Blnce t My 31, 2008 / November 30, Orgnic growth in revenues Second qurter 2008 First hlf yer 2008 As percentge excluding fx including fx excluding fx including fx Non-recurring revenues Digitl Document Systems Océ Business Services Wide Formt Printing Systems Totl Recurring revenues Digitl Document Systems Océ Business Services Wide Formt Printing Systems Totl Totl revenues Digitl Document Systems Océ Business Services Wide Formt Printing Systems Totl Pge 10

11 Qurterly report 2008/2 Consolidted Csh Flow Sttement In million First hlf yer 2008 First hlf yer 2007 Income before income txes Adjustments for: Deprecition nd mortiztion Impirment Shre-bsed compenstion 3 4 Shre in income of ssocites Other 2 5 Chnges in provisions, rentl equipment nd working cpitl: Retirement benefit obligtions 3 1 Provision for other libilities nd chrges 3 14 Other provisions [for inventories, finnce lese nd trde receivbles] Rentl equipment Inventories Finnce lese receivbles Trde nd other receivbles [excluding finnce lese receivbles] 25 9 Trde nd other libilities Income txes 5 2 Csh flow from operting ctivities Investment in intngible ssets Investment in property, plnt nd equipment Divestment in intngible ssets Divestment in property, plnt nd equipment 6 5 Chnge in other non-current ssets 4 Chnge in investments in ssocites Sle finnce lese portfolio 2 3 Sle/cquisitions [net of csh] 16 Csh flow from investing ctivities Free csh flow Proceeds from borrowings Repyments of borrowings 6 27 Dividend Chnge in equity relted to shres 1 2 Chnge in minority interest 2 3 Csh flow from finncing ctivities Currency trnsltion differences 8 Chnges in csh nd csh equivlents 65 6 Csh nd csh equivlents t strt of reporting period Csh nd csh equivlents t end of reporting period Pge 11

12 Qurterly report 2008/2 Profile Océ innovtive by nture Océ is leding worldwide supplier of professionl printing nd document mngement systems. A business tht is innovtive by nture, both commercilly nd technologiclly. Océ develops nd mnufctures systems for the production, distribution nd mngement of documents, in color nd blck-nd-white, in smll formt nd in wide formt, for users in offices, eduction, industry nd the grphic rts mrket. The product offerings comprise printers, scnners, peripherl equipment nd printing medi but lso document mngement softwre nd innovtive products in the res of system integrtion, the outsourcing of document mngement ctivities nd the lesing of printing systems. Océ s core product rnge, developed nd mnufctured by the compny itself, focuses on the smll formt nd wide formt nd, within the smll formt, on the [very] high volume segments. To supplement this, Océ offers its customers selected mchines sourced from Originl Equipment Mnufcturers [OEMs], often s prt of totl solutions. Océ s reputtion is founded on productivity nd relibility, ese of use nd fvorble totl cost of ownership. Océ is commercilly ctive in over 90 countries; in more thn 30 of these it hs its own sles nd service orgniztion. In Europe, North Americ nd Asi, Océ lso opertes 9 own reserch nd mnufcturing fcilities. In 2007 Océ, which hs nerly 24,000 employees, chieved revenues of 3.1 billion nd net income of 78.9 million. Business model Océ is one of the few suppliers tht is ctive in the entire vlue chin of printing systems: from development vi mnufcturing, sles nd finncing to service. Thnks to constnt feedbck within the chin Océ is ble to nticipte nd respond lertly to chnging mrket requirements nd new mrket opportunities. Océ s policy is steered in the vrious sub-mrkets by three Strtegic Business Units: Digitl Document Systems [DDS] for the smll formt, Océ Business Services [OBS] for document-relted services nd Wide Formt Printing Systems [WFPS] for the wide formt, in close co-opertion with Reserch & Development on the one hnd, nd Mrketing & Sles on the other. DDS serves the mrket vi Document Printing nd Production Printing. OBS serves the mrket geogrphiclly in Europe nd the United Sttes. WFPS vi the Technicl Document Systems, Disply Grphics Systems nd Imging Supplies business groups. A seprte ctivity, Softwre & Professionl Services, concentrtes on development nd implementtion of softwre in printing systems nd therefore supports ll business groups. In number of countries in which Océ itself is not represented the business offers prt of the product rnge vi specilized distributors. Vi its own Reserch & Development Océ itself develops its bsic technologies nd the mjority of its product concepts. The direct feedbck of customer experience serves here s n importnt source of inspirtion for concrete, current nd future solutions. Océ lso brodens nd strengthens its innovtive cpcity vi llinces with strtegic prtners nd co-opertion with codevelopers nd with OEMs for printing systems in the high, medium nd low volume segments. The publicly listed holding compny of the Group is Océ N.V. The issued shre cpitl mounts to round 53.7 million, divided into 43.7 million ordinry shres, 10 million finncing preference shres nd 1,500 priority shres. The ordinry shres nd the finncing preference shres hve nominl vlue of The ordinry shres of Océ re listed on the stock exchnge in Amsterdm [NYSE Euronext]. Options to Océ shres re trded on the Euronext Options Exchnge. Pge 12

13 Qurterly report 2008/2 Forwrd-looking sttements This report contins informtion s ment in rticle 5:59 jo. 5:53 of the Dutch Lw on finncil supervision [Wet op het finncieel toezicht]. Forwrd-looking sttements, which cn form prt of this report refer to future events nd my be expressed in vriety of wys, such s 'expects, 'projects', 'nticiptes', 'intends' or other similr words [ Forwrd-looking sttements ]. Océ N.V. [ Océ ] hs bsed these forwrd-looking sttements on its current expecttions nd projections bout future events. Océ s expecttions nd projections my chnge nd Océ s ctul results, performnce or chievements could be significntly different from the results expressed in or implied by these forwrd-looking sttements bsed on vrious importnt fctors, risks nd uncertinties which re neither mngeble nor foreseeble by Océ nd some of which re beyond Océ s control. When considering these forwrd-looking sttements, one should keep in mind these risks, uncertinties nd other cutionry sttements mde in this report or in Océ s other nnul or periodic filings. For more detiled discussion of these not limited fctors, risks nd uncertinties tht my ffect Océ s ctul results, performnce or chievements, reference is mde to the nnul report nd ny other publictions mde by Océ. Given these uncertinties no certinty cn be given bout Océ s future results or finncil position. We dvise you to be creful with Océ s forwrd-looking sttements, which spek only s of the dte on which the sttements re mde. Océ is under no obligtion to updte or revise publicly ny forwrd-looking sttement, whether s result of new informtion, future events or otherwise, except s my be required under pplicble [securities] lws. Océ enbles its customers to mnge their documents efficiently nd effectively by offering innovtive print nd document mngement products nd services for professionl environments. Pge 13