Business News
CeWe Color expects increase in turnover and income
Friday 02. May 2008 - Turnover to increase to 426 million Operative earnings forecast at 31 million (+ +12 %) EBT of 17 million (+33%) expected, despite extra expenses Earnings after tax to rise to 9 million (+53%)
After a 4.4 percent increase in turnover, to 413.5 million, and stable operative earnings of 27.8 million for the 2007 financial year, CeWe Color Holding AG (Prime Standard, ISIN DE 0005403901) plans to further increase turnover and income for the current financial year. With a three percent rise in turnover to 426 million, the company expects to see an above-average rise of twelve percent in operative earnings, to 31 million. This was announced by Dr. Rolf Hollander, Chairman of the Board of Management of CeWe Color Holding AG, at the annual report press conference held in Oldenburg.
Increase in income despite extra expenses for consolidating operations
Against the background of dynamic changes on markets, strong growth in digital photography and continuing declines in sales figures for analogue photographs as well as of success on the market for personalised products, such as the CEWE PHOTO BOOK, the company is continuing with the essential process of concentrating production at highly-efficient locations. CeWe Color will hence – as already announced – be closing the photofinishing operations in Bad Schwartau and Eisenach, as well as those in Valence and Bordeaux (two of the five French production operations) and will be transferring orders placed here to other operations. The CEO: “We will be shouldering extra expenses of another 14 million in the 2008 financial year.” With restructuring costs at 14 million, the Board of Management anticipates that earnings before tax will amount to 17 million (+33%). Earnings after tax for 2008 are expected to amount to around 9 million (+53%).
Capital expenditure remains high
In addition to marketing expertise and best-possible quality, the CeWe business model is based on cost leadership, requiring large volumes and batch sizes in terms of both production and logistics. “For this reason it was absolutely essential to concentrate production at few locations in Europe,” Dr. Hollander pointed out. With this approach the company was at the same time securing jobs in the remaining, particularly efficient operations. “However, a sustained high level of capital expenditure for increasing digital print capacities, in product development, in DigiFotoMakers at points-of-sale, goods presentations and the CEWE PHOTO BOOK brand were decisive for the earning power of the company in future,” Hollander said. In 2008, capital expenditure, at 35 million, was to almost reach the same level as that of the financial year of 2007 ( 35.5 million).