- 2014 profit targets all reached
- ROCE increases to 16.9 %
- Dividend to increase for the sixth time in succession
- CEWE ends 2014 free of debts and with a capital ratio of 51.1%
- Operative earnings targets for 2015 raised by two million euros over those for 2014
- CEWE distinguished by Superbrand Germany
After the successful business year of 2014 in which CEWE Stiftung & Co. KGaA (SDAX, ISIN: DE 0005403901) achieved all their profit targets, the Board of Management and the Supervisory Board will propose another dividend increase, of 5 eurocents to 1.55 euros a share - the sixth dividend increase in succession. CEWE has not only paid out a dividend that increases year-by-year; the company has in the meantime also repaid all its debts: After reporting a net financial debt of 16.3 million euros at the end of 2013, the company had net assets of 23.5 million euros at the end of 2014. CEWE is thus debt-free and reports a sound capital ratio of 51.1 %. "CEWE is ideally positioned with its first-class service, its strong brand - which has just been distinguished as an outstanding brand with the Superbrand Award - and with its excellent image. As a debt-free company with a sound capital ratio and a strong business model in terms of its income and cash flow, we are well positioned to generate more growth, independently of the financing environment. Not least of all, we were also in a position to enable our shareholders to participate in the positive development of the company with a rise in the dividend," says Dr.Rolf Hollander, Chairman of the Board of Management of CEWE Stiftung & Co. KGaA. CEWE is aiming for more earnings-oriented growth in 2015: The Board of Management expects income to exceed the targets for 2014 by around 2 million euros at all operative earnings levels. The high earnings power of photofinishing business is to continue to contribute to the expansion of high-potential commercial online printing. This was announced by CEWE during the Annual Report Press Conference held today in Frankfurt am Main. In 2014 turnover amounted to 523.8 million euros (currency-adjusted: 527.5 million euros; previous year of 2013: 536.2 million euros), and operative earnings (EBIT) improved considerably, from 28.9 million to 32.6 million euros. Earnings before tax (EBT) increased from 27.1 million euros in 2013 to 31.5 million in 2014. In the previous year, after-tax earnings benefited considerably from positive non-recurring effects resulting from the change in the legal form of the company (+ 3.3 million euros). For this reason after-tax earnings in 2014, at 21.4 million euros, were 0.9 million euros lower than in the previous year (2013: 22.3 million euros). Against the background of a return to a normal tax rate of 32.1 % for the Group (2013: 17.7 %), earnings per share reached 3.07 euros in the year of the report (2013: 3.39 euros). The return on capital employed improved considerably to reach 16.9 % (2013: 15.0 %). The free cash flow was more than doubled, to 28.1 million euros (2013: 13.1 million euros).
CEWE increases fourth-quarter EBIT by 11.0 per cent
The trend towards a seasonal shift continued into the fourth quarter of 2014: for years now, CEWE has been generating a growing share of its turnover and earnings in the Christmas quarter. While operative earnings (EBIT) for the first three quarters were still at -4.7 million euros, the final quarter of the year contributed sales of 194.8 million euros, around 2 % higher thanks to the strong Christmas business. After-tax earnings in the fourth quarter increased by as much as 11.0 %, to 37.3 million euros (Q4 2013: 33.6 million euros). CEWE thus generated around 37.2 % of its total annual turnover and far more than 114 % of its income in the vital fourth quarter. It was mainly the strong demand for the CEWE PHOTO BOOK, and for the CEWE brand products such as CEWE CALENDARS, CEWE CARDS and CEWE WALL PICTURES, which contributed to the positive development in the fourth quarter as well: "Photo products are highly popular as gifts because they are always individual, personal and self-made. At CEWE, photo gifts have resulted in increasing sales in the Christmas season," Dr. Hollander says. The turnover per photo increased by 7.5 %, from 19.02 eurocents in the same quarter of the previous year to 20.44 eurocents. A rising share of the prints came from mobile devices such as smartphones and tablets, with the share of orders placed with the numerous CEWE apps for these mobile devices also continuing to rise.
Photofinishing and commercial online printing develop strongly
The biggest CEWE business division grew even more than expected in the 2014 business year: with turnover at 386.0 million euros (+2.8 %) and EBIT at 38.4 million euros (+7.2 %), photofinishing accounts for 73.7 % of Group turnover and for 117.8 % of Group EBIT. In contrast, CEWE reduced its retail business by 33.4 % to turnover in the amount of 67.3million euros by abstaining from the low-margin wholesale line of business. Essential adjustment measures in Poland resulted in negative EBIT of -2.9 million euros in this segment. In contrast, commercial online printing grew by 17.8 % to 70.5 million euros, improving EBIT by 4.1million euros to - 2.9 million euros, in spite of the considerable amount of initial funding.
2015 targets: earning power, investments and dividends to continue to increase
"We wish to enhance our earning power in 2015 as well, even though we are making advance payments in our growth sector of commercial online printing," Dr.Hollander emphasised. In 2015, the Group turnover for all the business segments is to lie in the range of 515 million to 535 million euros (2014: 523.8 million euros). While the Board of Management expects sales to be just about stable in the high-margin sector of photofinishing, the potential decline in retail business turnover is to be more than offset if possible by an expected rise in turnover generated with commercial online printing. After 70.5 million euros in 2014 (17.8 %), the management believes that an increase in online printing turnover to more than 80 million euros should be possible in 2015. CEWE continues to maintain its target of generating a positive contribution to income in this new business segment from 2016 on. The target corridors for profits in comparison to 2014 are all being set at an increase of around two million euros for 2015: EBIT is to be in a corridor of 32 million to 38 million euros in 2015, EBT is to be in the range of 30 million to 36 million euros, and after tax earnings between 20 million and 24 million euros. Earnings per share are to be in the range of 2.87 to 3.45 euros. CEWE is also planning to increase investments to approx. 46 million euros (2014: 35.4 million euros). This investment figure includes a non-recurring special effect due to a building extension. At the same time the management is confirming its aim of consistently raising dividends in the coming years.
CEWE distinguished by Superbrand Germany
CEWE is among the excellent brands to have received a Superbrand Germany award. The independent international organisation awards a Superbrand mark of quality in honouring outstanding brands in Germany every year. The jury assessed criteria such as brand value, image, brand acceptance, consistency and customer loyalty, thus selecting the 52 Superbrands Germany for 2014/2015 from more than 1,250 brands.
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