Agfa sees revenue decline in H1
Agfa-Gevaert Group, the parent company of, Agfa Graphics has reported a year-on-year decline in revenue for the first half of the year, with declines across both its digital print and chemicals, and offset print segments.
Tuesday, 01 Sep 2020 11:22 GMT
Agfa-Gevaert Group posted a big profit after selling part of its healthcare business
Total sales in the six months to June 30th amounted to €832.0m (£744.3m), down 13.2% from €958.0m in the corresponding period last year.
Offset was the main source of income for Agfa during the first half, accounting for 41% of all sales, while digital print and chemicals generated 17% of sales. The remaining sales came from Agfa’s radiology and healthcare IT segments.
Focusing on offset, sales in H1 reached €342.0m, with 87% coming from digital computer-to-plate and 13% analog computer-to-plate.
According to Agfa, Covid-19 had a “very strong impact” in the second quarter, on top of the structural decline of the offset markets. As the pandemic caused a drop in advertising and commercial activities, this led to lower print volumes and less demand for printing plates.
Looking at the digital print and chemicals business, revenue was 21.9% down at €141.0m, again partly because of the impact of the pandemic on the market.
I am very proud of our teams who are going out of their way to continue supplying and supporting our customers in these tough conditions”
However, Agfa revealed that it is preparing several product initiatives in the sign and display market to be prepared for the rebound, while other new solutions are to launch in other sectors, including packaging.
Gross profit for the business amounted to €255.0m, down 14.0% from €296.0m at the same point in 2019.
Turning attention to costs, selling, general and administrative expenses were 15.0% lower at €255.0m, while research and development spend was also down 9.1% to €46.0m in H1.
Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) fell 28.0% to €55.0m, while adjusted earnings before interest and tax (EBIT) slipped 40.9% to €23.0m.
After restructuring costs, this left Agfa with an operating loss of €26.0m, as well as a loss before tax of €43.0m. After tax, Agfa posted a loss of €49.0m for H1.
The restructuring of the offset business has started with the announcement of the project to reduce our European manufacturing footprint”
However, when taking into account proceeds of the sale of part of its healthcare IT activities, this meant it was able to post a €670.0m net profit for the half.
“I am very proud of our teams who are going out of their way to continue supplying and supporting our customers in these tough conditions,” Agfa-Gevaert Group president Pascal Juéry says.
“We continue to rigorously control our working capital levels, capital expenditure, and costs to mitigate as much as possible the impact of the pandemic on our cash flow and bottom-line result.
“The restructuring of the offset business has started with the announcement of the project to reduce our European manufacturing footprint.”
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