Koenig & Bauer suspends dividend payment for the financial year 2019

The decision approved by the company board

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Koenig & Bauer
Koenig & Bauer AG’s 95th AGM took place as a virtual event for the first time

Germany’s Koenig & Bauer has decided to suspend the dividend payment for the financial year 2019 and carry forward the profit generated by the holding company Koenig & Bauer AG to new account.

“With a large majority, the shareholders confirmed the management and supervisory boards’ proposal to suspend the dividend payment for the financial year 2019 and to carry forward the retained profit generated by the holding company Koenig & Bauer AG to new account,” the company said.

The announcement was made during the company’s first virtual annual general meeting. In addition to details of the group’s business performance in 2019 and in the first quarter of 2020, the numerous product innovations and the successfully launched offensive for digitisation were the main topics were the topic of discussion during the AGM.

The management board reported that the coronavirus pandemic, which has been spreading rapidly since January, has already had a considerable impact on revenue and earnings in the current financial year.

“Our broad product portfolio with a significant share of revenue in system-relevant packaging printing, the robust, increasingly digital service business and our sound balance sheet with a high equity ratio limit the risk potential. With the corona crisis management established in March, we are working to actively counter this extraordinary situation,” CEO Claus Bolza-Schünemann said.

He said that the company’s action plan focuses on reliable customer support, cost and investment discipline and securing liquidity. “There were almost no restrictions on the supply chain. Short-time working has, however, been in place at different locations since 1 April 2020 due to capacity utilisation. Under the currently uncertain general conditions, the impact on revenue and earnings in the 2020 financial year cannot yet be quantified.”

Performance 2024 efficiency program is flanked by applying for a KfW loan

Bolza-Schünemann said that in parallel to the corona crisis management, Koenig & Bauer is working intensively on the Performance 2024 efficiency program, evaluating various scenarios.

In addition, improvements in working capital and cash flow are at the top of the agenda alongside the strategic focus on packaging printing and digital services, he said. To strengthen the stability and strategic flexibility of the group, the management board and the supervisory board decided to apply for a flexibly repayable KfW loan with a volume of up to €120m to supplement the existing syndicated credit lines (Direct Participation in Syndicated Loans).

“Among others, no dividend distributions are permitted during the term of the KfW loan. After the plans for increasing the operating profitability and performance of the group have been adopted, we will report promptly on the targets and costs of the Performance 2024 efficiency programme,” he said.

2023 promises an interesting ride for print in India

Indian Printer and Publisher founded in 1979 is the oldest B2B trade publication in the multi-platform and multi-channel IPPGroup. While the print and packaging industries have been resilient in the past 33 months since the pandemic lockdown of 25 March 2020, the commercial printing and newspaper industries have yet to recover their pre-Covid trajectory.

The fragmented commercial printing industry faces substantial challenges as does the newspaper industry. While digital short-run printing and the signage industry seem to be recovering a bit faster, ultimately their growth will also be moderated by the progress of the overall economy. On the other hand book printing exports are doing well but they too face several supply-chain and logistics challenges.

The price of publication papers including newsprint has been high in the past year while availability is diminished by several mills shutting down their publication paper and newsprint machines in the past four years. Indian paper mills are also exporting many types of paper and have raised prices for Indian printers. To some extent, this has helped in the recovery of the digital printing industry with its on-demand short-run and low-wastage paradigm.

Ultimately digital print and other digital channels will help print grow in a country where we are still far behind in our paper and print consumption and where digital is a leapfrog technology that will only increase the demand for print in the foreseeable future. For instance, there is no alternative to a rise in textbook consumption but this segment will only reach normality in the next financial year beginning on 1 April 2023.

Thus while the new normal is a moving target and many commercial printers look to diversification, we believe that our target audiences may shift and change. Like them, we will also have to adapt with agility to keep up with their business and technical information needs.

Our 2023 media kit is ready, and it is the right time to take stock and reconnect with your potential markets and customers. Print is the glue for the growth of liberal education, new industry, and an emerging economy. We seek your participation in what promises to be an interesting ride.

– Naresh Khanna

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