Koenig & Bauer (SKB) Q2 2024 earnings summary

Executive summary

• Operational guidance for 2024 is confirmed despite a challenging market, with cost improvement measures under the "Spotlight" programme and management reorganisation in Digital & Webfed.

• Order intake rose 16% year-over-year to €641.5m, with Q2 intake up 58.4%, driven by strong demand at drupa and strategic partnerships, resulting in a record order backlog of €1,021.0m.

• Revenue for H1 2024 declined 10.8% year-over-year to €532.0m, with EBIT at minus €33.9m, impacted by lower prior order intake and non-operating expenses, including €10m from drupa.

• The "Spotlight" programme targets €30–45m in special cost-saving effects for 2024, focusing on cost-cutting, restructuring, and shifting from R&D to marketing and operational excellence.

• Management changes and restructuring are underway, especially in Digital & Webfed, to address persistent losses and improve profitability.

Financial highlights

• H1 2024 revenue was €532.0m, down 10.8% year-over-year; Q2 revenue was €278.8m.

• EBIT for H1 2024 was minus €33.9m (margin -6.4%), with net loss widening to €49.3m; operating EBIT for H1 was minus €23.9m.

• Free cash flow improved to minus €27.7m from minus €64.7m a year ago, mainly due to changes in net working capital.

• Order intake reached €641.5m, up 16% year-over-year, outperforming the broader machine market.

• Net financial position deteriorated to minus €175.5m; equity ratio decreased to 24.4%.

Outlook and guidance

• Operating EBIT for 2024 is expected at the lower end of the €25–40m range; revenue target of €1.3bn is confirmed.

• The "Spotlight" programme aims for €30–45m in special cost-saving effects in 2024 and an EBIT margin of ~6% on €1.5bn revenue by 2026.

• Medium-term targets: revenue of €1.8bn and EBIT margin of 8–9%.

• A strong second half is anticipated, driven by order backlog conversion and cost measures.

• Negative bottom line expected for 2024 due to one-off restructuring and drupa costs.