“On the basis of the development in the first few months of the current accounting period, we are most optimistic that we will clearly be able to hold our market leading position in the photofinishing sector and in sales of photo books,” Dr. Rolf Hollander, Chairman of the Board of Management of CeWe Color Holding AG, said when presenting the annual financial statements in Frankfurt/Main. The company was benefitting from the considerable amount of investment it had made, its efficient production and the expansion of product marketing activities. “This is why we will be reducing capital expenditure for the current year by one third, to around 22 million euros, thus significantly reinforcing our cash flow,” Dr. Hollander emphasises.
Projections for 2008 fully achieved – record sales of CeWe Photo Books
CeWe Color fulfilled all the predictions made by the company in November 2008: Turnover rose to 420 million euros (2007: 413.5 million euros). The CeWe Color Photo Book was a significant growth driver here. Sales rose by 74.8 percent to a new record of 2.64 million books (2007: 1.51 million books). The number of digital photos also continued to grow: in 2008 (1.79 billion photos, +17 percent to previous year) it was more than twice as high as the number of photos from films (830 million photos). Earnings before tax and restructuring met the forecast figure of 22.1 million euros (2007: 25.0 million euros). 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 percent to 7.0 million euros due to a reduction in restructuring expenses.
2008 consolidated profit to be paid out in full to shareholders
The Board of Management and the Supervisory Board will propose a dividend payout of one euro per share eligible for dividends to the Annual General Meeting of the company, to be held on 28 May 2009; this means that the consolidated profit is being paid out in full to the shareholders.
Completion of restructuring promises increased earnings as of 2010
Since restructuring activities are due to be completed in the current business year, the Board of Management expects earnings to rise. In March CeWe Color announced that it would be closing production plants in Paris and Teplice (Czech Republic). This was the conclusion of a restructuring phase that has taken five years. During this time earnings had been reduced by more than ten million euros in restructuring costs every year. “This process of transformation will be completed in the current business year. As of 2010 there will no longer be any extra costs to bear. We will make sure that our shareholders participate in the resulting enhanced earning capacity and increased free cash flow,” says Dr. Hollander.Over the past ten years, with investments in digital products amounting to more than 250 million euros, CeWe Color has made great progress with the transformation from analogue to digital photography. The company is now Europe’s largest digital printer in the segment for high-quality, four-colour prints.
Sound financing secures growth trend
CeWe Color reports an extremely capital ratio of 42.9 percent. “This is a healthy basis for generating further growth, especially given the background of the current financial crisis,” says Hollander. This stock of available equity and the strong cash flow result in an enhanced credit standing and scope in terms of liquidity.