Oce Announces Third Quarter 2008 Results

Océ has an ongoing operational excellence program to improve business processes which will enhance customer service, shorten equipment delivery times and reduce costs. In 2008, in response to the weak economic situation, Océ accelerated the cost savings program in order to improve profitability. The operational excellence objective is to reduce expenses by Euro 80 million in 2008 and by an additional Euro 50 million in 2009. Year to date Océ achieved Euro 59 million savings. The total program includes a reduction of 950 job positions of which year-to-date 560 have been realized. In the third quarter some 280 positions were eliminated whilst Euro 10.2 million in restructuring expenses were incurred.

In the third quarter Océ sold the loss making coating related activities of Arkwright in the US. The sale resulted in a book loss of Euro 4.6 million and the realization of Euro 13.2 million currency translation differences. Under IFRS, translation results on equity in subsidiaries denominated in non-euro currencies are recognized directly in Equity under the heading Currency Translation Differences.

Upon disposal of the subsidiary the accumulated translation results are realized via the Income Statement. This IFRS accounting rule has no impact on Equity or cash flow.

In total, one-off items amounted to Euro 28.0 million of which Euro 4.6 million impacted gross margin and Euro 23.4 million impacted operating expenses.

Gross margin and operating income

Normalized gross margin, excluding one-off items, was 38.1% (2007: 39.1%1). Volume/mix effects and exchange rate effects caused a decline of 0.8% point. The sale of Océ Document Technologies and Arkwright accounted for a decline of 0.2% point.

Normalized operating expenses amounted to 35.7% (2007: 36.3%). This decrease was realized by vigorous execution of the operational excellence program. Net capitalized R&D costs amounted to Euro 3.9 million (2007: Euro 3.6 million).

On balance, normalized operating income amounted to Euro 16.8 million (2007: Euro 21.2 million). The strong euro caused a negative currency exchange impact of Euro 6 million. Operating income amounted to Euro 11.2 million (2007: Euro 21.2 million).

Financial expenses and net income

Financial expenses (net) amounted to Euro 11.3 million (2007: Euro 10.1 million).

Taxation was Euro 1.3 million (2007: Euro 1.3 million contribution to net income).

On balance, normalized net income was Euro 1.7 million (2007: Euro 12.6 million).

Balance sheet, RoCE and cash flow

The balance sheet total was Euro 2,378 million, compared with Euro 2,573 million at the end of the third quarter of 2007. The year-on-year change was mainly attributable to a reduction in accounts receivable, lower cash balances, the sale of fixed assets and exchange rate effects.

The net debt/EBITDA ratio amounted to 2.3 which is within the aspired bandwidth of 2.0 to 2.5 and well below the maximum in the loan covenants.

Net Capital Employed was Euro 1,292 million, compared to Euro 1,371 million at the end of the third quarter of 2007. In relation to normalized operating income, RoCE amounted to 6.6% (2007: 6.8%).

Free cash flow in the third quarter was Euro 17 million (2007: Euro 23 million). Cash flow from operating activities, Euro 6 million, was adversely affected by higher finance lease receivables, reflecting the situation in the financial markets, and lower accounts payable. The cash flow from investing activities, Euro 11 million, reflected higher expenditures both in intangible assets and Property, plant and equipment.

Océ has taken action to improve the free cash flow including an increased focus on inventories, accounts receivable and accounts payable. Océ also intensified its action to reduce out-of-pocket expenses and reduce the finance lease receivables.

Results of SBUs

Digital Document Systems (DDS)

Revenues in DDS amounted to Euro 395.7 million. Organically and excluding fax, revenues decreased by 1.7%. DDS grew its revenues in cutsheet systems. The revenue related to continuous feed systems declined following mainly the developments in the financial services sector.

The share of color increased to 23% of revenues (2007: 17%).

Non-recurring revenues amounted to Euro144.8 million. Revenues decreased organically by 2.0%. Excluding the divestment of Océ Document Technologies non-recurring revenues declined 0.7%, compared to the very strong third quarter of 2007 (in which non-recurring revenues rose 16.5%). DDS increased the sales of cutsheet equipment. The sales of continuous feed systems decreased as a result of a decline in the worldwide market.

« Previous Page 1 | 2 | 3 | 4 | 5  Next Page »



Review Article Be the first to review this article

Airbus

Featured Video
Jobs
Business Partner Manager for Cityworks - Azteca Systems, LLC at Sandy, UT
GIS Analyst II for Air Worldwide at Boston, MA
Mechanical Engineer for IDEX Corporation at West Jordan,, UT
Senior Structural Engineer for Design Everest at San Francisco, CA
Upcoming Events
RoboUniverse San Diego at San Diego CA - Dec 14 - 15, 2016
DGI 2017 at QEII Centre London United Kingdom - Jan 23 - 25, 2017
Geospatial World Forum 2017 Hyderabad at Hyderabad International Convention Center P.O Bag 1101, Cyberabad Post Office Hyderabad Telangana India - Jan 23 - 25, 2017
Trimble
CADalog.com - Countless CAD add-ons, plug-ins and more.



Internet Business Systems © 2016 Internet Business Systems, Inc.
595 Millich Dr., Suite 216, Campbell, CA 95008
+1 (408)-337-6870 — Contact Us, or visit our other sites:
AECCafe - Architectural Design and Engineering EDACafe - Electronic Design Automation TechJobsCafe - Technical Jobs and Resumes  MCADCafe - Mechanical Design and Engineering ShareCG - Share Computer Graphic (CG) Animation, 3D Art and 3D Models
  Privacy Policy