Cewe announces further growth in the first half of the year

In the first half-year period, which is typically negative due to the weak demand for photofinishing services, the operating result (EBIT) was a negative Euro 7 million (adjusted by Euro 3.3 million in extra expenses for location mergers), compared with a loss of Euro 6.1 million in the first half of 2012. The proportion of earnings in the annual net income generated in the first six months of the year is reduced due to the continuing seasonal shift into the fourth quarter, the company said. The 12-month return on capital employed (ROCE) reached 13.8 percent. “We are thus fully in line with our target for 2013 in all our categories, and we are confirming our forecast,” commented Dr. Rolf Hollander, CEO of Cewe Color. “We made intensive use of the first six months to prepare ourselves for the fourth quarter, the period which is the focus of our turnover and earnings, with product innovations and with reinforcing the brand.” In spite of the positive development in the first six months, the seasonal shift to the fourth quarter resulting from digitisation is expected to show a negative impact on the third quarter.

Cewe’s photofinishing recorded sales of Euro 138.8 million, a plus of 1.4 percent year-on-year, due to the increasing importance of added value picture products. In the first six months of 2013, the number of the company’s flagship product, the Cewe Photobook, rose by 3.5% to 2.195 million units. With a total of 967.8 million pictures processed, turnover per photo increased by 7.0% over that of the same period last year.

While negative earnings in the photofinishing business have always been normal in the first six months of the year, Cewe views the improvement in operative photofinishing EBIT from – Euro 4.4 million in the period of the previous year to – Euro 4.1 million in the first six months of 2013 as an important. “The distribution of roles in the business segments can already be recognized in the first six months: Progress in photofinishing enables us to invest in our growth sector of online printing,” said Dr. Hollander.

In spite of the dividend of Euro 1.45 per share paid out on 6 June, Cewe’s capital ratio grew from 37.2 percent by June 30, 2012 to a sound 38.1 percent by June 30, 2013. Based on a positive development of the company’s stock, which increased Euro 3.07 to Euro 34.11 from Jaunary 1 to June 30, and on the dividend, the total return for shareholders was Euro 4.52 in the first six months of 2013. This is equivalent to a return of 14.6 percent in relation to the 2012 closing share price (Euro 31.04).

On the basis of the first six months, the Cewe Board of Management sees its annual target confirmed, and expects to see more growth in 2013. Full-year turnover in the growth sector of online printing is expected to increase by around 40 percent, to Euro 60 million, with Group turnover rising in the range of 1–5 percent to Euro 510 to 530 million. The EBIT should be in the range of Euro 27 to 33 million in 2013, and earnings per share should amount to Euro 2.44 to 3.06.