Revenue climbs 5.7 percent to € 82.2 million / Earnings per share reach € 0.47 at nine-month mark / Positive outlook for 2014 financial year

In a generally rather subdued macroeconomic environment, the technotrans Group increased its revenue by 5.7 percent to € 82.2 million in the first nine months of the current financial year (previous year: € 77.8 million). Meanwhile the operating result (EBIT) rose by 56.2 percent to € 4.7 million (previous year: € 3.0 million). Compared with the prior-year period (3.9 percent) technotrans thus improved its EBIT margin to 5.8 percent, at the top end of its expectations for the 2014 financial year (EBIT margin of between 4 and 6 percent).

“The first nine months are behind us, and technotrans is strategically on track. As expected, the technotrans Group once again enjoyed success in the third quarter of 2014. At € 27.9 million and an EBIT margin of 6.3 percent for Q3, we again succeeded in increasing both revenue and earnings compared with the previous year, but also when measured against our performance throughout 2014 itself. Our share of revenue from outside the printing industry is growing steadily,” explained Henry Brickenkamp, Chief Executive Officer of technotrans AG. 

Profit after tax rose as the year progressed to € 3.0 million, representing an increase of 74.2 percent on the 2013 figure (previous year: € 1.7 million). After deduction of the minority interests there is a € 1.2 million improvement in the net income for the period to € 3.0 million compared with the first nine months of 2013 (previous year: € 1.8 million). This represents earnings per share outstanding of € 0.47 (previous year € 0.27).

The companies of the technotrans Group had an average of 769 (previous year: 768) employees in the current financial year of 2014.

The Segments
In the Technology segment, revenue increased from € 48.2 million in the previous year to € 53.5 million in the current year. The increase of around € 5.3 million or 11.1 percent compared with the prior-year period is mainly attributable to the successful expansion of business in the non-print area. Here, the segment profited both from accelerating business in the laser industry and from a growing revenue share for the self-developed technologies for temperature control, filtration, cooling lubricant preparation and spray lubrication. In addition, the printing industry likewise delivered higher revenue in the third quarter of 2014 than in the weak third quarter of 2013. Positive factors affecting the revenue performance included our increased market shares for offset printing and the arrival of new production models for digital and flexographic printing. As a result, the technotrans Group realises 65 percent of its revenue in this segment.

The financial performance in the Technology segment thus showed a palpable improvement in the first nine months of the 2014 financial year. Whereas a loss of € 1.8 million had been reported for the corresponding period of the previous year, the segment achieved a balanced overall result in the year in progress. The segment ended the third quarter of 2014 with its first positive result since the end of 2012: € 0.2 million (previous year: € -0.9 million).

The Services segment was unable to repeat the business performance of the previous two quarters in 2014, and the revenue figure of € 9.5 million was also down compared with the prior-year quarter (€ 10.5 million). Over the nine‑month period, revenue for the segment therefore showed a slight decrease of 3.2 percent on the 2013 figure (previous year: € 29.6 million). On the one hand the downturn in business stems from weaker demand due to the smaller installed base in the print sector, and on the other hand from a continuing reluctance to invest that is affecting the Technical Documentation business area.

The financial performance in the Services segment was again stable in the period under review and the healthy level of recent quarters was maintained. At the nine-month mark the result for the segment of € 4.8 million (previous year: € 4.8 million) is unchanged from the prior-year level; the return for the segment over this period is 16.6 percent, compared with 16.2 percent in the previous year.

Financial Position
Financial Position – Free Cash Flow Up
technotrans is able to present a strong balance sheet at September 30, 2014: equity rose 4.5 percent to € 45.7 million in the period under review, taking the equity ratio to 59.0 percent. Net liquidity for the group improved again and remained positive at € 3.2 million. Cash and cash equivalents were up slightly at € 17.6 million compared with the end of 2013.

Based on profit after tax of € 3.0 million (previous year: € 1.7 million) the operating cash flow in the first nine months of 2014 improved as expected to € 7.4 million (previous year: € 3.6 million). Net cash from operating activities reached a total of € 6.0 million (previous year: € 2.2 million). The cash outflow from investing activities showed a year-on-year fall as expected, amounting to

€ -2.3 million (previous year: € -5.6 million). The free cash flow at the end of the third quarter of 2014 was consequently again outstanding at € 3.7 million (previous year: € -3.4 million).

The cash flow from financing activities of € -2.8 million (previous year: € +2.7 million) comprises the scheduled repayment and the raising of short-term bank loans as well as the dividend distribution to technotrans shareholders.

Outlook
The moderate economic development remains in line with the original expectations for the current financial year. technotrans has good prospects of making the current financial year a success under its own momentum. By systematically continuing to pursue our growth strategy, we will achieve a further slight increase in revenue assuming business goes according to plan in 2014.

For the Technology segment, the Board of Management expects to achieve revenue growth of between five and eight percent in 2014. It has built a slight drop in the printing industry’s revenue share into this assumption, because demand for offset presses worldwide has showed a renewed fall in 2014 compared with 2013. On the other hand it expects robust demand for digital and flexographic printing presses. technotrans’ own development projects are also making a substantial contribution to revenue in the new markets. Alongside the laser segment, mechanical engineering as well as stamping and forming technology, medical technology is another driver of growth. Over the coming quarters the Board of Management is expecting energy storage technology and scanner technology to make additional contributions to revenue. The Services segment generates a relatively high proportion of overall revenue and thus plays an important part in keeping business stable. As matters stand revenue for 2014 is expected to be roughly on a par with the previous year.

Despite the slight economic slowdown, technotrans stands by its targets. “We are aiming for revenue of € 110 million in 2014 with EBIT in the region of 6 percent; these figures are at the upper end of our guidance for the financial year,” declared Dirk Engel, CFO of technotrans AG. “The earnings situation depends substantially on how the revenue volume and revenue mix develop further. From the present perspective we also expect to be able to increase revenue and earnings still further in the next financial year.”

The full 9-month Report 2014 can be downloaded under Investor Relations-Financial Reports.