Agfa publishes its second quarter 2017 results

Agfa’s worldwide wide-format inkjet business posted double-digit growth in Q2.

Based on the strong performance of the Anapurna wide-format equipment product range and the substantial increase in ink volumes for both wide-format and industrial applications, the Graphics wing, Agfa’s largest division, posted double-digit top line growth.

In the prepress segment, the sustainable chemistry-free solutions continued to perform well, but due to competitive pressure in the offset markets, Agfa Graphics’ revenue decreased by 3.7% compared to the second quarter of 2016.

Agfa Graphics’ gross profit margin decreased from 31.2% in the second quarter of 2016 to 30.1%, mainly due to adverse raw material effects. Recurring EBITDA (the sum of Graphics, HealthCare, Specialty Products and the unallocated portion) amounted to €22.9 million (7.4% of revenue), versus €28.9 million (9.0% of revenue) in last year’s second quarter and recurring EBIT reached €16.8 million (5.4% of revenue), versus €22.3 million (6.9% of revenue).

In the field of inkjet, Agfa Graphics introduced a LED version of the Jeti Tauro wide-format printer. The Jeti Tauro H2500 LED becomes the flagship of the business group’s wide-format UV inkjet printer portfolio. It features continuous and automated feeding of a wide range of flexible and rigid media, including several types of corrugated board.

The LED curing technology is an environmentally friendly and cost effective alternative for curing with high energy-consuming mercury bulb lamps.

At FESPA 2017 in Hamburg, the European Digital Press Association (EDP) awarded Agfa Graphics for its UV LED inks. With these inks, customers can produce high-quality prints on a wide variety of rigid and flexible substrates.

The recently launched Anapurna and Jeti Mira print engines with LED technology found their way to customers around the world.  Among the new customers are long-standing prepress client Sungwon Adpia (Korea); Bodoni AS and PJ Trykk AS (both in Norway); Comercializadora Carbesa, Merchandising Systems de México, Style Print, PM Packaging and Luis Murguia (all in Mexico); BOO Group and LC Digital (Australia).

Agfa launched a LED version of its Jeti Tauro H2500 at FESPA 2017 in Hamburg.

Agfa said it had also secured important new contracts at customers around the world for its chemistry-free plate offering, and said that aspect of the business continued to perform well, despite overall competitive pressures in offset plates.

Targeted at both the commercial printing and the sign & display markets, Agfa Graphics launched version 4.0 of its StoreFront cloud-based web-to-print solution. StoreFront allows printers to set up e-stores and to reach new markets on-line.

In the field of security printing, Agfa Graphics introduced new versions of two elements of the Arziro software for the general security printing market. Arziro Design 3.0 offers new security design features and integration with Arziro Authenticate 2.0, the updated version of the ultra-safe, encrypted distribution platform.

“Excluding the expected impact of the reorganization of the hardcopy distribution channels in China, we have delivered a decent set of results," commented Agfa president and chief executive office Christian Reinaudo.

"The fundamentals of our business are intact. Most of our growth engines performed well and Agfa HealthCare’s order book for its IT solutions is well-filled. Our costs are under control and we stick to our ambition to keep the recurring EBITDA margin around 10% of revenue on average in the years to come."

Healthcare posted EBITDA of €32.1m on sales of €264m in Q2, down 26.9% and 4.7% respectively. Agfa’s board has also tasked management with finding ways that it could potentially put its HealthCare IT activities into a standalone legal entity.

Sales at Agfa’s Specialty Products division, which includes synthetic paper, classic film products, and conductive materials, were up 3.4% to €49m while EBITDA was down 11.6% to €6.1m.

Group half-year sales were down 3% at €1.21bn, with EBITDA fell 21.4% to €99m.