News

Wincor Nixdorf's earnings up in 2002-2003

December 22, 2003

PADERBORN, Germany - Wincor Nixdorf reported that its revenue increased 7.1 percent to €1.44 billion (U.S. $1.78 billion) for the 2002-2003 business year ended Sept. 30.

Eearnings before interest, taxes, depreciation and amortization (EBITA) rose 18 percent to €104 million (U.S. $129 million).

"We achieved sales growth and an overproportional increase in our operating results against the industry trend," said Karl-Heinz Stiller, president and chief executive, in a news release. "This confirms that we have undertaken the right measures to ensure a stable business."

Wincor Nixdorf continued to drive the internationalization of its business, increasing the share of sales outside Germany by 62 percent to €900 million (U.S. $1.1 billion) of the total €1.44 billion.

Sales in Germany remained stable, despite a difficult economic climate. While sales to retailers increased, bank sales failed to reach the year-earlier level due to their severe pressure to lower costs. Europe accounted for the largest share of international sales, with Wincor Nixdorf again achieving double-digit growth.

Wincor Nixdorf's banking business, including services, rose 6 percent to €839 million (U.S. $1 billion), up from €792 million (U.S. $982 million) a year earlier. The company reported good results in Eastern Europe, with the assistance of local partners, as well as the UK and France.

Although sales in Asia were "substantial," according to the release, Wincor Nixdorf sees a "huge need for improvement" in the region. In the United States, the cooperation with IBM led to expanded business activities and higher sales.

Wincor's retail business grew, 9 percent, to €602 million (U.S. $747 million), from €533 million (U.S. $661 million) the previous year. Again, Europe was the focus of its international retail business expansion, with increased sales in France and the UK, as well as several Eastern European countries. Outside of Europe, with the exception of the U.S., sales remained below expectations, according to the release.

Point-of-sale systems were the primary driver of growth in retail sales, with a sales increase of 33 percent in 2002-2003.

Wincor Nixdorf further expanded its services and solutions business. Services designed for the branch operations of banks and retailing companies accounted for about 40 percent of the company's sales (including IT services and the software and consulting business), while hardware generated 60 percent of company sales.

Services to banks and retailing companies achieved double-digit percentage rates, continuing to drive the newly changed corporate structure. The new structure focuses on offering a wide range of services in the service value chain via the company's own resources and on expanding its independence in this area.

Along these lines, Wincor Nixdorf expanded its own technician organizations and customer care center. Internationally, the company expanded its own service resources in the former eight regional units. In Belgium, for instance, Wincor Nixdorf acquired the IT service business of Banksys in October 2002 in a move to offer nationwide service for self-service terminals, POS systems and client-server networks.

To optimize spare part service, the company launched its own logistics infrastructure and repair network in more than 70 countries.

Wincor Nixdorf invested €66.1 million (U.S. $82 million), or 4.6 percent of total sales, in research and development. "This investment highlights the importance that Wincor Nixdorf attaches to innovation as a cornerstone of its future strategy," said sales managing director Eckard Heidloff.

Wincor Nixdorf also invested in additional personnel, according to the release. The number of employees worldwide increased by 365, or 7.9 percent, to 4,983. Of these, 3,032 were employed in Germany and 1,951 outside of the country.

The service area accounted for the lion's share of additional personnel; around 170 new employees alone came from the acquisition of Belgium's Banksys. In addition, the sales organizations in several international units were strengthened with additional staff.

In 2004, Wincor plans to focus on the European market, including Eastern Europe. In the Asian and South American markets, Wincor Nixdorf aims to increase sales with the launch of two new subsidiaries in Brazil and Indonesia.

In North America, the goal remains to win market share, on its own in the retail area and through its partnership with IBM in the banking sector.