KBA Group enjoys a strong 2016 after print packaging growth

The Koenig & Bauer (KBA) Group has reported strong growth this year, with group revenue in the first nine months of 2016 rising by 22.3% to €831.4m (£705m).

The order backlog was valued at €613.3m at the end of September, up 2.7% on the previous year, and is sufficient to ensure the capacity utilisation of the group’s plants until spring 2017.

KBA president and chief executive Claus Bolza-Schünemann said: “With underlying economic and political conditions still challenging, our heightened focus on the growth markets of packaging and digital printing as well as service business is paying off." 

"Even more encouraging than the substantial revenue growth is the sizeable increase in earnings for the period under review underpinned by the high profit generated in the third quarter." 

"With operating earnings (EBIT) of €39.2m and earnings before taxes (EBT) of €34.9m, we were able to substantially outperform the first nine months of the previous year (EBIT of €6.1m and EBT of €2.1m). All segments contributed to this performance with positive figures for the quarter and the first nine months,” said Claus Bolza-Schünemann, president and CEO of KBA.

The Sheetfed segment achieved a 17.5% increase in revenue in the first nine months of 2016 to €443.8m, accompanied by segment earnings of €17.3m.

New orders in the segment, however, were down from the previous year’s figure of €516.4m. KBA attributed this to factors including the economic slowdown in China and other export markets, longer lead times and the shift in the distribution of orders over the individual quarters compared to 2015.

Order intake in the Digital & Web segment rose due to a number of orders for web offset presses for commercial and newspaper printing as well as further orders from HP for the inkjet web presses for corrugated packaging, assembled at Würzburg. New orders in the segment rose by 11.2% to €100m with revenue jumping by 74.6% to €110m.

The group’s Special presses segment saw order intake climb by 29.9% to €384.3m and revenue rise by 22.3% to €338.2m. This was attributed to increased business in security, metal, coding and flexible applications.

“Despite the heightened challenges in the international market, we see our main task as being to stabilise the profitability of all segments and KBA companies and to additionally enhance it in the medium term,” commented Bolza-Schünemann.

The company has a long heritage in the folding carton packaging markets and sees great potential in emerging markets, predicting the demand for cartons will increase by 17% from current levels to around $18bn (£14.5bn) in 2020, with growth showing the fastest rates in highly populated threshold countries like China and India.

“All sectors of the global packaging market are set for growth by 2020 with the greatest potential for growth predicted in film, corrugated and board packaging,” said KBA (UK) product and marketing manager Craig Bretherton. 

“KBA is active in all six of the packaging markets (flexible packaging, corrugated board, cardboard, rigid plastics, glass and metal) and holds the number one position in three of them. The recent investments in Flexotecnica, Iberica (die cutters), and KBA Kammann (glass decorating) alongside the return of the KBA Corrugraph after a 10 year absence from the market means that KBA are well placed to meet the demands for growth in these markets."

The press manufacturer has a successful relationship with print and packaging companies. It partnered with HP to create the HP T1100S, which was launched in 2015 to produced digital printing directly onto corrugated sheets up to 2.8 metres wide. The partnership has blended the material transport knowhow from KBA with the experience of digital technology from HP.

KBA also launchd the RotaJET which has applications in the digital newspaper market, floor covering markets and book printing which is based upon similar technology.

The first machine is set to be installed at FESPA UK Association member DS Smith in the UK following successful beta testing and numerous other projects are planned.

KBA and Xerox announced earlier last year a partnership for development of the VariJET 106 digital carton press incorporating finishing and traditional print units.

In the same way as the joint HP project, the inkjet side of the device will be provided by Xerox and the press, transport systems and all the other mechanical components of the press will be provided by KBA. The press is scheduled to be officially launched in 2017.