Manroland Sheetfed reports pre-tax profits of €72.4mn

The accounts show that the sheetfed business and assets excluding German properties were acquired last February for €55 million in cash. The deal was funded by Langley Holdings, whose property arm acquired the press builder's headquarters and manufacturing facilities in Offenbach and other properties in Germany for €21.8 million in a separate transaction.

Langley Holdings reported a non-recurring gain of €25.2 million arising from the property deal in its 2012 Annual Report & Accounts published last month, which contributed to its pre-tax profit of €121.3 million. Langley's property arm has subsequently purchased the freeholds to manroland operating properties in the US, Italy and Belgium and plans to acquire freeholds to other outposts in 2013.

SFHL is currently owned by the British industrialist Tony Langley, who is also the sole shareholder of Langley Holdings. It is planned to absorb the press builder into Langley Holdings later this year and when the merger is completed the group will employ around 4000 people and have annual revenues close to €1 billion euros.

Since being acquired, Manroland Sheetfed has been transformed from a heavily loss-making business into a viable stand-alone concern. The press builder will be the third under-performing German engineering business to have been acquired by Langley over the last 10 years.

Tony Langley, CEO and chairman of the group said,” In my review at the half-year, I said that I was expecting 2012 to be another record year for the Langley Group. That has proven to be the case, with these results surpassing those of 2008 and 2011. For some years now the Group has been operating debt free and with substantial cash reserves. Recently, we have invested some of our surplus cash to acquire business premises occupied by our subsidiaries.”

“The most significant real estate purchase in this programme so far occurred in February 2012, when the Group purchased the million-plus square foot headquarters and manufacturing facilities of related company, Manroland Sheetfed, in Offenbach, Germany. As rental income from our subsidiaries and related companies is now a material amount we have identified this within operating profit for the first time this year. The Offenbach purchase gave rise to a fair value adjustment of €25.2 million which is shown as a non-recurring gain in these accounts,” he added.

Commenting on the results, Natasha Tandon, manager - marketing and strategy, Manroland India, “It is certainly a very positive development that further reiterates that Manroland is a strong brand. This makes Manroland Sheetfed the only German sheetfed manufacturer making a profit last year in the difficult industry conditions.”

In February, Langley had said, “Whilst our competitors are losing money at current price levels, we are not. Our company’s cost base is much lower, so I am content to sit it out. Revenue for vanity, profit for sanity goes the motto.”

“In 2013 the Manroland Sheetfed Group, which includes some forty subsidiaries world-wide, is now structured to break even on revenue of €350 million. At this level the production facilities in Germany would be operating at around one third of capacity and at 80% utilisation with current manning levels. Considering demand for printing presses remains depressed and there is currently significant overcapacity in the market, this is a satisfactory situation. As the business achieved slightly over this volume in a year which saw much upheaval, I would expect to see something of an improvement in 2013,” added Langley.