Bobst reports sales increase for first half of 2022

Bobst Group continued to record strong order entries in the first half of 2022, 8% higher compared to the first half year 2021. Sales were at 773-million Swiss Franc for the first six months of 2022, compared to 667-million Swiss Franc in the first half of 2021.

25 Jul 2022 | By Rahul Kumar

The operating result increased to 29-million Swiss Franc, compared to 15-million in 2021

The operating result increased to 29-million Swiss Franc, compared to 15-million in 2021. The net result reached 22-million Swiss Franc, up from 5-million in the previous year. Sales and results for the first half year were according to expectations. Net cash decreased from 154-million Swiss Franc at the beginning of the year to a net debt position of 3-million at the end of June 2022. Order backlog is 40% higher than in the previous year.

The Group expects a good second half of the year due to the high backlog and service activities but there are also significant risks which can negatively impact the full year results. These are mainly due to the very tense supply chain situation and material price increases as well as insufficient global transportation capacities, but also the uncertain geopolitical situation.

During the first half of 2022, consolidated sales amounted to 772.5-million Swiss Franc, representing an increase of 105.1-million, or 15.7%, compared with the same period in 2021. Volume and price variances had a positive impact of 115.7-million Swiss Franc, or 17.3%.

The exchange rates had an overall negative impact on sales of 11.5-million Swiss Franc, or -1.7%.

An improvement of 0.9-million Swiss Franc, or +0.1%, came from the full year effect of the acquisition of Jetpack SAS, Paris, France, completed on 11 January 2021, and the acquisitions of Cm Service Italia, Lonato del Garda, Italy, in September 2021, North American Cerutti Corporation, and 24/7 Cerutti Service, Italy, in November 2021.

The increase of consolidated sales was due to higher backlog at the beginning of the year and record high sales for spare parts and services due to very high level of activity at customers’ plants. Less travel restrictions caused by the pandemic situation allowed the Group to install more machines and to perform more service interventions than in the same period in 2021.

The availability of several specific components needed to assemble the equipment deteriorated compared to the second half of 2021. The missing parts led to inefficiencies and rework in all Bobst production sites and the Covid-shutdown in China created additional under-absorption in its Chinese factories.

The business unit experienced a positive evolution with slightly higher order entries compared to the previous year. The backlog is at an all-time 40% higher than the previous year, mainly due to increased demand for eCommerce, shelf-ready packaging as well as replacement of old equipment. Turnover increased about 20% compared to previous year despite the difficulties in the global supply chain and lockdowns in China in the second quarter.

According to the company, the main market trends remain eCommerce, sustainability, and recyclability (circular economy) in all industries. This generates excellent opportunities for Bobst to address these market demands with new solutions for barrier film and paper, new recyclable mono-material laminates, and films for the flexible packaging industry. 

For the folding carton and corrugated board industry, the company’s new real-time performance monitoring, quick set-up, and waste reduction solutions are well perceived by the market. 

In general, the consolidation in the industry goes on, including the creation of new greenfield plants and the vertical integration from paper and film producers into converting activities. In parallel, brand owners are tending to start a regionalisation of solid and resilient supply chains to better mitigate the global risks.

The severe impact of foreign exchange rates trends, the supply chain turbulence, the energy and raw material price increases and availability represent the greatest challenges for the company. A dedicated cross-functional task force is managing these by leveraging our global scale and production planning capabilities.

The company said, for the full year, order entries should remain at a good level. The uncertainties caused by the high inflation in its core markets, by the unpredictable supply chain and by the geopolitical situation, could however easily lead to a strong slowdown in the second half of 2022. Not to forget the evolution of the sanitary situation and travel restrictions which might impact the last quarter of the year.

Public tender offer for Bobst 

JBF Finance SA, Buchillon, Switzerland (JBF) has announced a public tender offer for all publicly held shares of Bobst Group. JBF is Bobst Group’s largest shareholder and already holds approximately 53% of the shares and voting rights in the company.

JBF has announced that it will pay 78.- Swiss Franc in cash per Bobst Group share, which represents a premium of 22% compared to the average price of the last four weeks. The offer is not subject to substantial conditions. Following completion of the offer, JBF expects to be able to take Bobst Group private through a delisting of its shares from SIX Swiss Exchange to allow the company to focus on long-term and sustainable growth. 

This offer will give the company the appropriate conditions to deploy a long-term strategy, to execute its digital transformation, and to maintain its strong Swiss industrial activities.

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