Heidelberg adopts action package to increase profitability
03/17/2020
- Consistent focus on Heidelberg’s profitable core business
- Closure of unprofitable businesses as well as sharp cuts in production costs and structural costs – production of “Primefire” and “very-large-format printing” will be stopped
- Action package includes global reduction in force by up to 2,000 jobs
- Non-recurring expenses of approximately €300 million impact FY 2019/20 earnings
- Return transfer of around €375 million in liquidity from trust fund secures financing of action package and significantly increases financial stability
- Net debt to be almost completely eliminated; high-yield bond to be repurchased
- Focus on technology leadership in core business with emphasis on digitalization to advance
The Management Board of Heidelberger Druckmaschinen AG (Heidelberg) today adopted a wide-ranging action package, as announced last year, for a short-term reduction in structural costs and long-term improvements in the Company’s profitability. Focus on the profitable core business and systematic streamlining of the cost base are geared to delivering a €100 million improvement in EBITDA, excluding the restructuring result. At the same time, a return transfer of liquidity reserves from the trust fund will almost completely eliminate net debt, thereby significantly improving Heidelberg’s financial stability.
“Heidelberg’s realignment is a radical step for our Company that also involves some painful changes. As hard as it was for us to make this decision, it is necessary in order to put our Company back on track for success. Discontinuing unprofitable products enables us to focus on our strong, profitable core. This is where we will further extend Heidelberg’s leading market position by leveraging the opportunities of digitalization. Going forward, we will continue to provide our customers worldwide with technologically leading digital solutions and services across the board,” said Heidelberg’s Chief Executive Officer Rainer Hundsdörfer.
