STRATEGIC PARTNERS
Preliminary results for the company's fiscal year, which ended Sept. 30, show a dip in hardware sales partially offset by an increase in software and services.
November 9, 2015
Wincor Nixdorf AG has released preliminary revenue numbers for fiscal 2014-2015 and reports that full-year results are slightly better than the company forecast at midyear when it issued downwardly revised guidance.
Net sales for 2014-2015 totaled 2.4 billion euros/$2.61 billion, down 2 percent from 2013-2014 (2.5 billion euros/$2.66 billion).
Operating profit before restructuring measures amounted to 1 billion euros/$109.7 million. After taking these measures into account, EBITA was 22 million euros/$23.7 million.
Profit for the year was 8 million euros/$8.6 million (104 million euros/$111.9 million).
With restructuring efforts ongoing, Wincor expects to achieve a turnaround in performance in the 2015-2016 fiscal year.
This includes slight growth in net sales and substantial improvement in operating profit, which is expected to rise 50 percent to 150 million euros/$161.3. This number will settle at approximately 110 million euros/$118.3 million after 40 million euros/$43 million in restructuring costs in the current fiscal year.
Among factors generating upward momentum are already-completed cost reductions and efficiency improvements. Software and related services also are expected to contribute to further earnings increases, the company said.
Now established as a separate unit, the company's cashless and mobile payment operations are expected to contribute to growth, as well.
"The transformation program we have initiated will bring significant changes to our group," Wincor Nixdorf AG CEO and President Eckard Heidloff said in a statement. "The effects that have already become visible within our business serve as confirmation that the approach we have taken is correct and that we must continue to pursue these measures with the necessary vigor."
BRIC countries weigh on performance
A downturn in Wincor Nixdorf's business in Brazil, Russia and China left a noticeable mark on year-over-year results, the company said.
Additionally net sales in Germany fell 6 percent to 555 million euros/$597 million (588 million euros/$632.5 million), attributable primarily to weaker retail business.
In Europe excluding Germany, net sales declined 4 percent to 1.1 billion euros/$1.18 billion (1.14 billion euros/$1.23 billion) largely due to a reduction in net sales from business activities in eastern Europe, with Russia proving particularly unfavorable.
Despite the downturn in China, the group reported growth in other Asia-Pacific countries. The proportion of net sales generated in the Americas was unchanged.
Divergent performance
Net sales for the banking segment rose slightly to 1.58 billion euros/$1.7 billion (1.56 billion euros/$1.68 billion).
However, net sales in retail declined 6 percent to 845 million euros/$909 million (903 million euros/$971.4 million) due to tentative investment spending by large retail companies, particularly in Europe, the company said.
Software and services up, hardware down
At 1.02 billion euros/$1.1 billion, net sales of hardware fell 10 percent from the previous year (1.13 billion euros/$1.21 billion). Reductions were due to lower sales of banking hardware in key emerging markets; base effects caused by especially large retail orders in 2013-2014; and an ongoing decline in market prices.
By contrast, net sales for software and services grew 5 percent to 1.41 billion euros/$1.52 billion during the year under review (11.34 billion euros/$1.44 billion).
Personnel restructuring
The group employed 9,100 people as of Sept. 30, 2015, compared with 9,198 the previous year. Under the restructuring program, 450 jobs were cut during the fiscal year, while approximately 120 new jobs were created as part of nearshoring efforts. Approximately 200 employees were recruited with regard to project-related activities.
R&D spending
Wincor Nixdorf invested 90 million euros/$96.8 million in R&D activities over the reporting year (98 million euros/$105.4 million). The R&D ratio stood at 3.7 percent (4 percent).
