Wincor Nixdorf nine month Ebita up 21.9%

Source: Wincor Nixdorf

After three quarters of fiscal 2004/05, business performance at Wincor Nixdorf AG continues, as expected, in a positive vein.

Net sales revenue at the end of the nine months was up 12.2% at EUR 1,264.9 million (previous year equivalent: EUR 1,127.5 million), equating to an increase of 13.8% after adjusting for exchange rate movements. The Company added 7.6% to its third-quarter revenues which reached EUR 423.9 million (previous year equivalent: EUR 394.1 million). Operating profit at the nine-month point before amortization of product know-how (EBITA) was 21.9% ahead at EUR 98.6 million as opposed to EUR 80.9 million at the same time last year. Return on sales was 0.6 percentage points higher at 7.8% (previous year equivalent: 7.2%). Net profit for the period during the first three quarters was EUR 39.5 million, EUR 9.1 million ahead of the comparable figure last year. The number of people employed by the Group during the first three quarters increased by 603 to 6,717.

"The first three quarters confirm expectations," explained Wincor Nixdorf's Chief Executive Officer Karl-Heinz Stiller who pointed to the fact that the Company has continued to reinforce its strong position outside Germany with disproportionately high levels of growth in Europe, also growing considerably in Asia and the Americas. "In addition, as an enabler for sustained growth, we've made improvements on the cost side, for example by continuing to lower our sales and general administration expenses."

International and services business strengthened in Europe (excl. Germany), net sales in the first nine months of the fiscal year rose 25.8% to EUR 682.1 million (previous year equivalent: EUR 542.4 million). The favorable trend in Europe is also reflected in the Company's in-house market research, which shows that Wincor Nixdorf has made further substantial progress towards its goal of the number 1 position in its chosen verticals of retail banking as well as the retail industry in Europe.

In Asia and the Americas, the Company succeeded in securing significant growth ahead of market growth rates. Net sales revenue in the Americas increased 19.9% to EUR 100.6 million during the period under review (previous year equivalent: EUR 83.9 million). In Asia-Pacific & Africa, net sales grew 20.5% to EUR 145.5 million (previous year equivalent: EUR 120.7 million).

In Germany, weak banking business and muted performance in retail meant revenues ended the first nine months at EUR 336.7 million 11.5% below the same figure last year (EUR 380.5 million). Germany contributed 26.6% of total net sales revenue (previous year equivalent: 33.7%).

Both the Company's business segments saw double-digit growth rates. Banking sales improved 11.0% to EUR 737.4 million (previous year equivalent: EUR 664.2 million) in the first three quarters of the fiscal year, with third-quarter revenues of EUR 15.6 million, 6.6% ahead of the same period last year. In the first nine months of the fiscal year, the retail segment produced net sales 13.9% up at EUR 527.5 million (previous year equivalent: EUR 463.3 million), aided by third-quarter sales of EUR 14.2 million (9.0% up).

An analysis by business stream shows product sales in the first nine months up 8.7% at EUR 744.4 million, with third-quarter sales up 4.9% to EUR 251.4 million (previous year equivalent: EUR 239.6 million). The Company grew solutions and services revenue by 17.6% to EUR 520.5 million during the period under review. Third quarter solutions and services revenue increased 11.7% to EUR 172.5 million (previous year equivalent: EUR 154.5 million).

As a result, the element of total net sales revenue derived from service streams grew to 41.1% during the first nine months (previous year equivalent: 39.3%). This is in line with the Company's objective of continuous improvement in the proportion of total revenues generated from solutions and services. With this in mind, Karl-Heinz Stiller pointed to the growth potential available in winning branch and store-related outsourcing projects. "We are preparing for increasing demand among financial institutions to outsource further elements of their IT functions." With its own service resources, detailed knowledge of branch and store-based processes within the banking and retail industries and ever-growing experience of international projects, Wincor Nixdorf is positioned well to benefit from this.

Forecast now firmer: net sales to rise 10%, EBITA to rise 12% We regard the basis for our full-year forecast of 10% growth in net sales revenue and 12% growth in EBITA as having been strengthened. "In view of the favorable performance to date and our expectations for Q4, we now expect to be able, at very least, to meet these rates of growth," said CEO Karl-Heinz Stiller on the outlook for the full fiscal year.

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