Wincor Nixdorf full year Ebita jumps 31%

Source: Wincor Nixdorf AG

Wincor Nixdorf AG has completed fiscal 2012/2013 with year-on-year growth of 5% in net sales and a significant increase of 31% in operating profit (EBITA). In total, net sales generated by the supplier of IT solutions for banks and retailers in fiscal 2012/2013 amounted to €2,465 million (prev. year: €2,343 million), while EBITA rose to €132 million (prev. year: €101 million).

Profit for the fiscal year increased by 40% to €88 million (prev. year: €63 million). The proposed dividend is up markedly at €1.48 per share (prev. year: €1.05). Although the first quarter is expected to be slightly weaker than in the preceding year, Wincor Nixdorf will be looking to maintain its pattern of growth in the current fiscal year 2013/2014, with a projected 4% increase in net sales and additional fast-track growth in EBITA of 17%, which would take earnings to €155 million.

"Growth generated in the emerging markets during the current fiscal year 2013/2014 will once again be sufficient to offset the protracted weakness in investment spending within the European market," said CEO & President Eckard Heidloff. Despite a slightly brighter macroeconomic outlook for some of Europe's key industrialized countries, Wincor Nixdorf had not yet seen a significant improvement in its business prospects in this region. At the same time, Heidloff noted that the Group's business endeavors in the emerging markets would be accompanied by continued pressure on profit margins.

Committed to expanding its business with an eye to the future, Wincor Nixdorf will press ahead with the strategic realignment of its operations. The aim of remodeling measures currently being pursued by the company is to exploit to an even larger extent the benefits associated with change in its markets and sustain the pattern of growth to which it has recently returned. Alongside assertive positioning within the emerging markets and the advancement of its business in the area of cashless and mobile payment methods, the focus in particular is on expanding Wincor Nixdorf's software activities. "We want to double our software business to over €600 million in the coming five years," said Heidloff in emphasizing the company's commitment. He went on to explain that Wincor Nixdorf intended to focus in particular on organic growth, complemented by suitable acquisitions.

According to Heidloff, software - in conjunction with innovative hardware - is playing an increasingly important role in the business process changes being implemented by retail banks and retailers. In this context, he pointed to fundamental industry trends such as the integration of multiple sales channels, new features introduced at branch and store level, and mobile communication and distribution concepts. At the same time, the growing importance of software - accompanied by increasingly buoyant demand - has become apparent in the field of IT infrastructure optimization. Wincor Nixdorf also believes that developments within the competitive environment will open up attractive opportunities for expansion. "The market covered by software vendors is currently showing signs of consolidation, as was the case several years ago in the hardware sector. We are priming ourselves," said Heidloff. He explained that the trend towards consolidation was being driven to some extent by market fragmentation, with many small software vendors competing for business. At the same time, many companies were still deploying proprietary applications that now appeared obsolete given the speed of evolution in this market and the costs involved.

Wincor Nixdorf already generates net sales of more than €300 million within the Software segment. Of the Group's global workforce of approx. 9,000 people, around 1,500 staff members focus on software development and associated Professional Services, such as process analysis, integration and customizing services, training, and maintenance.

Regions: Asia accounts for strongest growth in fiscal 2012/2013
In Germany, net sales were slightly down on the previous year at €567 million (2011/2012: €572 million). Accordingly, reflecting the pattern of stronger growth in other regions, Germany's share of the Group's total net sales contracted further to 23% (2011/2012: 24%). In Europe (excluding Germany), net sales were up 7% on the previous year at €1,216 million (2011/2012: €1,134 million). As a proportion of total net sales for the Group, the contribution made by Europe (excluding Germany) was unchanged at 49% (2011/2012: 49%). Thus, Europe retained its position as Wincor Nixdorf's strongest sales market. The Asia/Pacific/Africa region outpaced all the others to achieve 9% growth. Net sales rose to €418 million (2011/2012: €385 million). The overall contribution of Asia/Pacific/Africa to the Group's net sales total was 17% (2011/2012: 16%). Net sales in the Americas rose by 5% to €264 million (2011/2012: €252 million). Expressed as a percentage of the Group's total net sales, the figure remained unchanged at 11% (2011/2012: 11%).

Segments: Growth in business with banks
Net sales generated in the Banking segment rose to €1,614 million (2011/2012: €1,524 million). This corresponds to a year-on-year increase of 6%. EBITA for this segment improved by 49% to reach €103 million (2011/2012: €69 million). Net sales achieved within the Retail segment increased by 4% to €851 million (2011/2012: €819 million). Segment EBITA declined by 9% to €29 million (2011/2012: €32 million).

Substantial growth in Hardware business - Software/Services business also expands
The Group's return to growth was mainly due to a substantial increase in Hardware sales. Total consolidated net sales of Hardware rose by 8% to €1,185 million (2011/2012: €1,100 million). The main factor behind this significant increase was a very strong performance from the Banking Hardware business in the emerging markets. As a result, the share of total Group net sales generated from the Hardware business showed a slight year-on-year increase to 48% (2011/2012: 47%). Net sales of Software/Services were up 3% at €1,280 million (2011/2012: 1,243 million). The slowdown in growth compared to the previous years is attributable to a slightly more subdued performance from Managed Services and Outsourcing. Overall, the share of total Group net sales generated from the Software/Services business was 52% (2011/2012: 53%).

Lower headcount
At the end of the fiscal year, Wincor Nixdorf employed 8,826 people worldwide, 231 fewer than at the end of the previous year (2011/2012: 9,057). The headcount in Germany stood at 3,774, down by 34 compared to the previous year (2011/2012: 3,808). The number of staff employed outside of Germany also contracted, in this case by 197 to 5,052 (2011/2012: 5,249).

R&D expense increases year on year
Wincor Nixdorf invested in new technologies and the development of new products over the course of the fiscal year just ended. Expenditure relating to research and development (R&D) stood at €99 million - €9 million above the level of the previous year (2011/2012: €90 million). Software-related R&D accounted for approx. 30% of this figure. The R&D ratio stood at 4.0% (2011/2012: 3.8%).

Dividend proposal: €1.48 per share
Wincor Nixdorf remains committed to its existing dividend policy of distributing around 50% of its profit for the period as a dividend. Compared to the previous year, the dividend proposed to the Supervisory Board for the reporting period has been raised by 41% to €1.48 per share (2011/2012: €1.05). The proposed dividend was calculated on the basis of a profit of €88 million for the fiscal year.

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