Paderborn, Germany, 2014-1-20 — /EPR Retail News/ — Wincor Nixdorf AG completed the first quarter of its current fiscal year with a decline in net sales and growth in operating profit. Compared with the same period a year ago, net sales for the first quarter fell by 5%. In total, net sales stood at €638 million (previous year: €669 million). Operating profit (EBITA) increased by 5% to €42 million (40 million). As a result, the EBITA margin rose by 0.6 percentage points to 6.6 % (6.0%). Profit for the first three months of fiscal 2013/2014 stood at €28 million (€27 million). Wincor Nixdorf had anticipated that business would move in this direction, given the strong performance recorded in the same period a year ago. Against this backdrop, the company is confident that it will be able to maintain the pattern of growth to which it had returned in the preceding fiscal year. With this in mind, the company has confirmed its forecast. It expects to generate growth of 4% in net sales in the current fiscal year 2013/2014, while operating profit is again projected to expand significantly by an estimated 17% to €155 million.
“Having completed our restructuring program last year, we consider ourselves well placed to sustain the considerable level of growth generated in emerging markets,” said CEO & President Eckard Heidloff in justifying the company’s favorable business outlook. He went on to explain that this forward momentum would again compensate for the persistent sluggishness affecting Wincor Nixdorf’s business activities in Europe. Alongside growth in the emerging markets, expansion of the company’s Software business is at the top of the agenda. “Increasingly, consumers are wanting to decide for themselves whether they use a smartphone, a tablet, the Internet or branch-based services to make their transactions. Banks and retailers are responding to this trend, and we are here to support them in their efforts,” said Heidloff.
Alongside sustained cost-related pressures, trends such as these illustrate the growing importance of software to Wincor Nixdorf’s overall business. Within the next five years, the company is looking to double its revenue generated through Software business and associated Professional Services – from net sales of around €300 million at present to €600 million. Its commitment in this area is underpinned, among other things, by the recent acquisition of DATEC, a Czech software enterprise that specializes in retail solutions. DATEC focuses, in particular, on data integration relating to omni-channel and ERP processes. The software specialist has developed proprietary software that delivers information for sales consultations via mobile devices, such as tablets.
Net sales down year on year in Banking segment – Retail segment records growth in net sales
In the first quarter, net sales in the Banking segment were down 11% at €400 million (€448 million). EBITA for the Banking segment amounted to €30 million (€33 million) in the first three months of the fiscal year, which constitutes a decline by 9% or €3 million. By contrast, net sales generated in the Retail segment rose by 8% to €238 million (€221 million) in the first three months of the fiscal year. Thus, Wincor Nixdorf managed to lift EBITA attributable to the Retail segment by 71%, or €5 million, to €12 million (€7 million).
Performance by region
In Germany, net sales for the first quarter of the fiscal year contracted slightly by 2% to €151 million (€154 million), thus accounting for 24% (23 %) of the Group’s total net sales in the reporting period. Net sales generated in Europe (excluding Germany) over the first three months of the fiscal year stood at €303 million (€317 million), which corresponds to a decline of 4%. Against this backdrop, Europe continued to account for 47% of the Group’s total net sales, unchanged from the same period a year ago and still the largest contributor to consolidated revenue. Asia/Pacific/Africa saw net sales fall by 4% to €115 million (€120 million) in the first three months of the current fiscal year. Asia/Pacific/Africa contributed a share of 18% (18%) to total net sales for the Group. Expressed in U.S. dollars, net sales generated in the Americas fell by 8% during the reporting period. Translated into euros, net sales for this region declined by 12% to €69 million (€78 million). Thus, the Americas accounted for 11% (12%) of total net sales within the Group.
Performance by business stream
In the first quarter of the fiscal year, net sales attributable to Hardware business totaled €305 million (€332 million), which corresponds to a year-on-year decline of 8%. Net sales from Software/Services fell by 1% to €333 million (€337 million). The share of total net sales attributable to the Hardware business stood at 48% (50%). Correspondingly, Software/Services business accounted for 52% (50%) of total net sales.