Reduced expenses for restructuring and a non-recurring tax effect enabled the European market leader for digital photofinishing to raise earnings after tax by 19.4 % to EUR 7.0 million. This is due to an extremely strong fourth quarter in which turnover grew considerably by EUR 10.2 million (+9.3 %) to EUR 120.7 million. Operative earnings (EBT before restructuring) rose considerably above average, by 54.7 % to EUR 8.3 million in the fourth quarter of 2008. Earnings on sales rose from 4.9 % in the fourth quarter of the previous year to 6.9 %. After-tax earnings for the fourth quarter – reinforced by a non-recurring tax effect – increased to EUR 6.6 million (2007 Q4 EUR 0.1 million). "The excellent development in the fourth quarter confirms that we are successfully concluding the transformation to digital business and that our attractive product portfolio is generating growth despite the negative market environment," says Dr. Rolf Hollander, Chairman of the Board of Management of CeWe Color Holding.AG.
Record sales in CeWe Photo Books
More than anything else, CeWe Photo Books and photo gift articles produced the growth in sales in the fourth quarter. In this period alone, CeWe Color produced 1.04 million CeWe Photo Books. For the full year of 2008 sales thus rose by 74.8 percent to reach a record of 2.64 million books (2007 1.51 million books). The production technology used for the majority of CeWe Photo Books, digital printing, is also extremely significant for photo gift articles. Here sales of photo greeting cards and photo calendars, which are also produced with digital printing technology, are growing, particularly in the Christmas season. "Our exceptional digital print expertise and wide distribution in the Internet as well as 50,000 retail stores supplied are a significant competitive advantage," Dr. Hollander points out.
Considerable digital growth thanks to the Internet
Considerable growth in the number of digital photos (incl. CeWe Photo Book prints and photo gift article prints) was maintained in 2008: while the number of digital photos produced in 2007 exceeded the number of photos from films for the first time ever, the number of digital photos (1.79 billion prints) in 2008 was more than twice as high as the number of photos from films (830 million prints). This is mainly due to the high level of marketing expertise for online business in the company: The number of digital photos ordered online rose by 36.1 % for the full year, to 873.8 million photos. In the fourth quarter of the year, Internet business even rose by as much as 40.8 percent, to 281.3 million photos. Photo gift articles and the CeWe Photo Book in particular were able to benefit from strong Internet business.
Sound financing secures growth trend
CeWe Color reports an extremely sound stock of available equity amounting to 42.9 percent. Together with a gross cash flow, which continues to be strong, this foundation constitutes a sound basis for more growth, particularly in the face of the current financial crisis.
Restructuring project in France supposed to enable positive yield development
CeWe Color intends to undertake a restructuring measure in France during the course of 2009 in order to adapt to developments on the photofinishing market there. The main staff council in France was informed about this project and is currently being heard. The production operation in Paris is in particular supposed to be closed down. "It is essential to adjust capacities in France in order to be able to return to a positive development in yields on this market too," says Dr. Hollander. The Frenchmarket is to be catered for from the labs in Rennes, Montpellier and Freiburg. CeWe Color would resolutely continue to pursue its strategy of yield orientation in the 2009 business year too.