Heidelberger Druckmaschinen Aktiengesellschaft ETR: HDD reported lower first-quarter sales and sharply weaker adjusted EBITDA as the expiration of an Italian incentive program weighed on demand, particularly in its Print & Packaging Equipment business. Management nevertheless reaffirmed its full-year 2026/2027 outlook, citing expected sales normalization, ongoing cost actions and expansion in higher-margin and technology-focused businesses.
Order intake for the quarter totaled €537 million, down 4% from €560 million a year earlier. Sales declined 13% to €404 million from €466 million. Adjusted EBITDA fell to €1 million from €20 million in the prior-year quarter, resulting in an adjusted EBITDA margin of 0.2%, compared with 4.4% a year earlier.
CEO Jürgen Otto said the phaseout of Italy’s subsidy program accounted for more than €60 million fewer orders in the country versus the prior-year first quarter. While Italy and other EMEA markets pressured sales, China recorded a clear sales increase, and China, Japan and the U.S. increased order intake, according to the company.
Backlog rises despite sales pressure
Head of Finance Volker Herdin said Heidelberg’s order backlog increased to €762 million at the end of June from €639 million at the beginning of the fiscal year, providing visibility for coming quarters. The company said the lower sales volume was concentrated in Print & Packaging Equipment, with EMEA sales affected by Italy, the Alps region and Turkey.
Regional performance was mixed:
- EMEA order intake declined 16% to €241 million, while sales fell 23% to €195 million.
- Asia-Pacific order intake rose 17% to €177 million and sales increased 3% to €129 million, led by China.
- Americas order intake was broadly stable at €119 million, while sales declined 9% to €80 million. Higher sales in Brazil only partly offset lower sales in the U.S. and Mexico.
Herdin said relative product margins improved through pricing, customs-duty refunds and mix effects. The company also continued cost-reduction measures, reducing headcount by 2% year over year to 9,019 employees. Staff costs decreased to €196 million from €208 million.
“Profitability was primarily impacted by lower volumes rather than structural factors,” Herdin said, adding that Heidelberg expects measures already implemented to support a gradual profitability improvement during the fiscal year.
Cash flow and balance sheet
Free cash flow was negative €77 million in the first quarter, compared with negative €68 million a year earlier. Operating cash flow was negative €55 million. Heidelberg attributed the free-cash-flow decline primarily to lower earnings and higher investment activity, including strategic acquisitions and defense-related investments.
The company said working capital improved by about €15 million year over year, supported by lower inventory and higher customer prepayments. Quarterly investments of €24 million included approximately €11 million for the acquisition of Manroland Sheetfed’s service and spare-parts business, as well as investments related to ONBERG.
Equity declined to €536 million at the end of June from €568 million at fiscal year-end, and the equity ratio fell to 24.3% from 27.2%. Heidelberg recorded a net loss of €32 million in the quarter. Its net financial position moved to negative €39 million from positive €39 million at the prior fiscal year-end. The company said €298 million of its €436 million revolving credit facility remained undrawn at the end of June.
During the analyst question-and-answer session, Herdin said Heidelberg expects less cash outflow through the remainder of the fiscal year than in the first quarter but expects free cash flow to remain negative for the year because of planned investment. The company did not provide a specific free-cash-flow target.
Acquisitions and production expansion
Heidelberg highlighted the acquisition of Manroland Sheetfed and the complete acquisition of post-press specialist POLAR as steps to expand its role as a packaging-production system integrator and increase recurring service and spare-parts revenue.
Chief Technology and Sales Officer David Schmedding said Manroland adds more than 3,000 customers and has operations in 35 countries with about 600 employees. Heidelberg expects Manroland operations to contribute a mid-double-digit million-euro amount to group sales in the current year, with no impact on the operating line.
Over a planned two-year integration period, Heidelberg targets stable combined sales contribution of more than €100 million and an annual EBIT contribution of about €10 million to €15 million. Schmedding said integration efforts include cost-base optimization, global-footprint improvements and IT systems integration. The company reported its first sale of a Heidelberg Cartonmaster CX 145 very-large-format machine to a Manroland customer.
Heidelberg also launched HEIDELBERG Industrial Solutions in North Macedonia, where it has begun assembling post-press equipment. Management expects the site to reach full operating capacity by 2028 and said transferring POLAR production to the country is intended to improve cost competitiveness.
Technology initiatives and outlook
Beyond its core printing operations, Heidelberg is pursuing HD Advanced Technologies in defense, energy and e-mobility. Otto said the company’s partnership with PHENOGY is intended to develop a European platform for sodium-ion battery energy-storage systems. Heidelberg would contribute manufacturing, printing, automation, system integration and service capabilities, while PHENOGY contributes chemistry, product and market expertise.
The companies may establish a joint venture if their collaboration expands successfully, although Otto said it was premature to discuss ownership arrangements. Heidelberg also cited ONBERG’s live demonstration hub in Brandenburg for integrated counter-unmanned aerial system solutions, focusing on critical-infrastructure protection.
Management confirmed its full-year guidance for broadly stable group sales and a noticeable improvement in adjusted EBITDA margin. Print & Packaging Equipment sales are still expected to decline noticeably, while margins are expected to improve significantly. Digital Solutions & Lifecycle is expected to post slight sales growth, while HEIDELBERG Technology is expected to deliver significant growth in sales and margin.
Otto said the anticipated near-term margin improvement is expected to be driven primarily by higher sales volumes and cost savings rather than a major current-year contribution from defense activities. Heidelberg also said it expects group margins to expand year over year in the second quarter.
About Heidelberger Druckmaschinen Aktiengesellschaft (ETR:HDD)
Heidelberger Druckmaschinen Aktiengesellschaft, together with its subsidiaries, engages in manufacture, sale, and dealing of printing presses and other print media industry products in Europe, the Middle East, Africa, Asia/Pacific, Eastern Europe, North America, and South America. The company operates through Print Solutions, Packaging Solutions, and Technology Solutions segments. It offers printing machines, including digital, offset, narrow web, screen, and inline-flexo printing, as well as remarketed equipment; and finishing equipment comprising cutting, die-cutting and embossing, folding, inspection, folding carton gluing, hot foil stamping, and shingled folding.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.
Continue following MarketBeat
Add MarketBeat as your preferred source on Google to see our latest stories in your feed.
Before you consider Heidelberger Druckmaschinen Aktiengesellschaft, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Heidelberger Druckmaschinen Aktiengesellschaft wasn't on the list.
While Heidelberger Druckmaschinen Aktiengesellschaft currently has a Hold rating among analysts, top-rated analysts believe these five stocks are better buys.
View The Five Stocks Here
Discover the 10 Best High-Yield Dividend Stocks for 2026 and secure reliable income in uncertain markets. Download the report now to identify top dividend payers and avoid common yield traps.
Get This Free Report
