The FINANCIAL — Wincor Nixdorf AG closed its first quarter of the current fiscal 2009/2010 with net sales and operating profit (EBITA) down 6% and 13% respectively on the same period in the preceding fiscal 2008/2009.
"Net sales for the Group, which specializes in IT solutions for the branch operations of banks and retailers, fell in the first three months to €607 million (previous year: €646 million). EBITA was also lower at €49 million (€56 million). The EBITA margin fell accordingly to 8.1% (8.7%), while profit for the period declined 6% to €33 million (€35 million). Looking ahead at the rest of the fiscal year, President & CEO Eckard Heidloff pointed to the continued impact of the economic and financial crisis. “In the short term at least we expect the worldwide environment to remain challenging. Developments in the market and in our business are still difficult to predict,” he explained. Against this background he sees the probability of fluctuations in business performance during the year and within regions. For fiscal 2009/2010 as a whole, Wincor Nixdorf anticipates a further decline in its net sales and operating profit, albeit no greater than that experienced in the last fiscal year (2008/2009: net sales – 3%, EBITA – 13%)," Wincor Nixdorf informs.
Heidloff also noted that at present it is not possible to identify any consistent trends in the IT solutions business for retail banks and retailers. Although capital expenditure on new systems to replace older IT infrastructure is being put back, he observed, companies are nevertheless investing in streamlining measures and process optimization. Regardless of economic developments in specific countries, he believes the individual financial strength and strategy of each company is now playing an increasingly important role. “We anticipate that the fundamental trends within our field of business will remain unchanged. However, at the moment it is not possible to predict when this will be translated into renewed growth.”
Wincor Nixdorf has prepared itself for the forthcoming challenges with its ProFuture program, whose aim is to improve internal processes and structures, as well as the company’s ability to perform successfully in its markets. Work on gradual implementation of the various measures and steps devised as part of the program began at the start of the fiscal year. The goal is not only to emerge in good shape from the crisis, but also to prepare the organization for the point when the economy as a whole picks up and stabilizes.
Net sales down in both segments – Uneven regional performance
Net sales in the Banking segment ended the first quarter 8% lower at €419 million compared with the same quarter in the previous year (€456 million). Net sales generated in the Retail segment showed a small year-on-year decrease of 1% to €188 million (€190 million). Net sales in Germany for the first three months of the current fiscal year rose by 15% to €178 million (previous year: €155 million), thus accounting for 29% (previous year: 24%) of total Group net sales. At €252 million (previous year: €333 million), net sales in Europe (excluding Germany) showed a decline of 24% in the first quarter. This region contributed the largest part of total Group net sales at 42% (previous year: 52%). Net sales in the Asia/Pacific/Africa region fell slightly to end the quarter down 2% at €98 million (€100 million), taking the region’s share of total Group net sales to 16% (15%). In U.S. dollars, the Americas delivered a 53% increase in net sales over the reporting period, equivalent to a rise in euro terms of 36% to €79 million (€58 million), thus boosting the region’s share of total Group net sales to 13% (9%).
Growth in Software/Services and Hardware remains under pressure
Net sales attributable to the Hardware business fell 13% to €326 million (€373 million) in the first quarter of the current fiscal year compared with the same quarter in the previous year. By contrast, net sales from Software/Services showed a 3% rise to €281 million (€273 million). As a result, the share of total Group net sales attributable to the Hardware business stood at 54% (58%), while the share achieved by Software/Services climbed to 46% (42%).
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