Source: Wincor Nixdorf
Against the backdrop of inconsistent market recovery and in view of the fact that planned net sales and earnings contributions from business with high-end systems are not yet achievable in full, Wincor Nixdorf AG has lowered its forecast for the current fiscal year 2010/2011.
At the beginning of the fiscal year, the company had set itself a target of 6 per cent growth in net sales and 8 per cent in EBITA, stating that this would be dependent on the speed of recovery within its markets. The company now anticipates that it will achieve growth of 4 per cent in net sales in the current fiscal year 2010/2011, while operating profit is expected to match or slightly exceed last year's figure. At the same time, on May 3, 2011, the Board of Directors, with the consent of the Supervisory Board, agreed a new stock buyback program, under which up to 1,737,569 of the company's no-par-value shares may be repurchased via the stock exchange. At present, Wincor Nixdorf AG holds 1,570,929 treasury shares. Including the latest stock repurchases, total treasury shares held will account for 10 percent of the company's share capital.
Net sales for the first half of fiscal 2010/2011 were up 4% year on year, while operating profit (EBITA) remained unchanged. Group net sales for the IT company, which specializes in the branch operations of banks and retailers, ended the first six months of the fiscal year on €1,208 million (previous year: €1,161 million). At €88 million, EBITA was on previous year's level, while profit for the period contracted by 3% to €58 million (€60 million). With national economies developing, in part at least, at such widely different speeds, the picture in Wincor Nixdorf's key markets is currently one of slow recovery only.
"Whereas both retail banks and retailers are now proceeding with system replacements that had previously been postponed, the scale of investment in larger streamlining and automation projects is still below anticipated levels," explained the company's President and CEO Eckard Heidloff. Also Wincor Nixdorf can not achieve in full the planned additional net sales and earnings contributions from its business with high-end systems. So far the Americas region has been unable to match the performance of the same period in fiscal 2009/2010, during which it had supplied a large number of high-end systems. Alongside, the company's new system generation CINEO, worldwide acclaimed as innovation, has not yet generated the volume of net sales initially anticipated following its market launch.
First half with growth in net sales in both segments - regional performance within expected range. Net sales in the Banking segment ended the first half of fiscal 2010/2011 1% higher at €802 million (€791 million). By contrast, net sales for the second quarter declined by 1%. Net sales generated in the Retail segment rose by 10% to €406 million in the first six months of fiscal 2010/2011 (€370 million). In the second quarter, net sales increased by 14%.
In Germany, net sales declined by 8% to €318 million in the first half of the fiscal year (€344 million), thus accounting for 26% (30%) of the Group's total net sales. For the second quarter of the fiscal year, net sales in Germany amounted to €151 million (€165 million), which translates into a year-on-year decline of 8%.
At €569 million (€470 million), net sales in Europe (excluding Germany) for the first half were 21% up on the figure posted in the same period a year ago. This region contributed the largest part of total net sales for the Group at 47% (40%). In the second quarter of the fiscal year, net sales in Europe (excluding Germany) improved by 27% to €276 million (€217 million).
Net sales in the Asia/Pacific/Africa region expanded by 8% to reach €199 million in the first six months of the fiscal year (€184 million). Asia/Pacific/Africa contributed a share of 17% to total net sales for the Group (16%). In the second quarter of the fiscal year, net sales generated in Asia/Pacific/Africa increased by 3% to €90 million (€87 million).
In U.S. dollars, the Americas recorded a 28% decline in net sales in the first half of the fiscal year. Expressed in euros, this corresponds to a fall of 25% to €122 million (€163 million). Thus, the proportion of Group net sales generated in the Americas stood at 10% (14%). In the second quarter of the fiscal year, net sales for the region were down 33% at €57 million (€85 million).
Growth in net sales in both Hardware and Software/Services business
In the first half of the fiscal year, net sales attributable to the Hardware business grew by 3% year on year to €625 million (€608 million). Net sales from Software/Services increased by 5% to €583 million (€553 million).
At 52%, the share of total net sales attributable to the Hardware business was unchanged on the same period for the previous year. Correspondingly, the proportion of total net sales from Software/Services was also unchanged at 48%.
Stock buyback: Board of Directors makes use of the authorization granted by the Annual General Meeting
With the consent of the Supervisory Board, the Board of Directors of Wincor Nixdorf AG, passed a resolution to repurchase up to 1,737,569 of the company's shares on the stock market during the period from May 04 to September 30, 2011, thus making use of the authorization granted by the Annual General Meeting on January 24, 2011.
In the case of the approved repurchase of own shares, the purchase price per share (excluding ancillary costs of purchase) shall deviate by no more than 10 percent in either direction from the determined share price in the opening auction of XETRA trading on Frankfurt Stock Exchange.
The repurchased shares are to be used for all legitimate purposes and for those covered by the authorization granted by the Annual General Meeting, in particular, for the purpose of settling obligations arising from share options to be issued on basis of the authorization granted by the Annual General Meeting on January 25, 2010 to members of the Board of Directors, other managers or staff members of the company and/or subordinated affiliated entities.
Wincor Nixdorf AG currently owns 1,570,929 own shares. Including the agreed share repurchase own shares will reach 10% of the share capital.