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Solvency position remains undiminished strong
Groenlo, 4 February 2010 The N.V. Nederlandsche Apparatenfabriek "Nedap" ended the year 2009 with a modest profit of At the start of 2009 it soon became clear that Nedap had also been hit by the economic crisis. Virtually all market groups were confronted with a strong decline in demand. In light of the high added value of the revenue, the profitability of the company was affected immediately. Due to the rapidity and intensity of these economic developments, drastic measures were unavoidable. The solid financial position of Nedap, however, made it possible for us to take measures that will have both a short-term beneficial impact and contribute to the further development of Nedap in the longer term. In the year under review a reorganisation took place with the loss of 56 jobs, and a large part of the production capacity was concentrated at Inventi B.V., a 100% subsidiary, in Neede. Furthermore, we increased our investment in marketing and sales activities. The market groups Healthcare (computerisation of administrative tasks of health workers) and Library Solutions (RFID self-service check-in/checkout systems for libraries) saw their revenue rise once more in 2009, despite the economic crisis. The Healthcare group mainly achieved its revenue from software licenses to homecare organisations. In addition, the group successfully launched a new service for the employment agency sector which has made paper timesheets a thing of the past. The Library Solutions group generated its revenue mainly from RFID (radio frequency identification) solutions for libraries, which are marketed in various European countries. The Security Management market group (systems for access control, payment, fire and intruder alarms, observation and biometrics) suffered less from the worldwide economic crisis than expected. Thanks to its extensive network of business partners and the enlargement of its product portfolio the market group was able to maintain its revenue in the year under review at the level of the previous year. The revenue of the Agri market group (computerisation, management and information systems for the dairy and pig farming industry) fell considerably compared to the excellent year of 2008. In 2007 and 2008 Agri still benefited strongly from the investment wave in above all the dairy farming sector. The economic crisis and low milk and pig prices, however, resulted in a marked drop in investment in the sector in 2009. The AVI market group (Automatic Vehicle Identification) experienced the negative consequences of the poor economic situation in various European countries primarily in the 2nd half of 2009. In other continents, however, its revenue continued to grow or stabilised. In total, revenue were modestly behind those of 2008. The relatively small market groups Education (access control and computerised attendance registration of students) and Locker Management Systems (electronic locks and management systems for lockers for clothing, luggage, medicines, etc.) also suffered from modest willingness to invest in the markets where it is active. Revenue were down on those for 2008 here too. The Election Management Systems market group is currently in a transitional phase. The group, active in several countries, was working on the development of a new election management system and a system with which local councils can consult citizens via the internet in the year under review. The group was hardly able to realise any revenue in the year under review. The market groups Power Supplies (electronic controlling systems based on power electronics for light, environments, office automation, medical scanning equipment, and autonomous energy systems) and Specials (electronic control systems for home comfort and car comfort, as well as telecom connecting equipment) operated in 2009 almost entirely as classical suppliers, with a relatively high dependency on their clients. Nedap has previously decided to rapidly reduce this dependency by introducing its own product lines and focusing its commercial activities on these products. Product lines are currently being developed for energy and lighting control systems. The first new products were launched on the market in the autumn of 2009. Revenue of both market groups in 2009 were strongly down on 2008. This was largely due to the automotive and mobile power supply sub-markets. Revenue of the market group Retail Support (anti-shoplifting systems, control and information systems to combat stock losses) were slightly down on the previous financial year. This was caused by the poor economic situation in East Europe, Spain, and Great Britain. The group developed and launched new market concepts during the 2nd half of the year. This has allowed it to further intensify its contacts with end users. The initial results are promising. The group has had a presence in Asia with its own branch in Shanghai since the start of 2009. It has thus strengthened its position both in terms of purchasing and sales. Other market groups are now also operating out of this branch. Financial Total revenue for 2009 reached € 115.2 million, and thus were almost 20% lower than 2008 (€ 143.0 million). The added value (revenue less movement in inventories and cost of materials) over 2009 amounted to € 78.8 million (2008 € 95.6 million). The policy that was introduced for a shift towards products with a higher added value was reflected in the financial year by an increase in the added value percentage from 66.9% in 2008 to 68.4% in the year under review. Expenditure on 'Subcontracting and other external costs' fell in the year under review by € 0.8 million. On the one hand costs fell due to the lower production levels, but on the other hand there was an increase in expenditure on marketing. Salaries, including social security charges, fell by almost € 1 million primarily due to lower variable remuneration and social security contributions. The normal depreciation in the year under review was € 0.4 million lower and the impairment was € 1.5 million lower than in 2008. The costs incurred in connection with the reorganisation amounted in total to € 4.7 million before taxes. This mainly concerned redundancy payments. The operating profit before deduction of the reorganisation costs reached € 6.7 million, 6% of revenue (2008: 14%). Low interest rates and lower expenditure on interest protectors resulted in a drop of € 0.3 million in financing expenses. The profit after taxes of our associate Nedap France S.A.S. was € 0.1 million down on the previous year. Investment in a new collaboration model with major clients and expenditure to strengthen the organisation for the future put pressure on the result here. At the end of the year under review, Nedap France S.A.S. moved to its own new futuristic office building just outside Paris. The impact of fiscal incentive schemes meant the tax liability of the Nedap Group (without the associate) was 18% (2008: 26%). The above resulted in a profit for the year under review of € 1.1 million. Excluding reorganisation costs, the profit was € 4.6 million, 4% of revenue (2008: 10%). The total investments in tangible fixed assets required € 5.4 million. The total depreciation amounted to € 6.3 million. Capital expenditure on intangible assets (capitalised development costs) was € 2.4 million, € 1.1 million more than was amortised. The financial fixed assets rose by € 2.4 million, primarily due to the increase in the fund value of our pension scheme. The current assets fell by almost € 3.5 million, primarily due to lower 'Trade and other receivables'. Solvency (shareholders´ equity excluding undistributed profit divided by total assets) rose from 42.6% at year-end 2008 to 44.2% at year-end 2009. The non-current liabilities stayed virtually the same. Also noteworthy is the extension of the financing agreement with the company's main bank by two years until mid-2012. This new agreement does not include any covenants either. The most important reason for the increase in current liabilities is the payment of the dividend for 2008. The bank overdraft increased by more than € 9 million as a result. The number of employees at the end of the year was 601. This was on balance 51 less than at the beginning of the financial year. This decrease was primarily the result of the reorganisation carried out. On average, there were 652 employees during 2009, 8 more than in 2008. Perspectives Knowledge of the customer´s (business) process and application of new technologies form the basis for the development of new, original and sustainable applications that give the customer a distinctive capability. This qualitative aspect of the revenue, as expressed in good added value in percentages of revenue, is of central importance. This has the highest priority and serves to create the solid foundations on which Nedap is continuing to build organic revenue and results growth. In the short term, revenue and results may be influenced by caution in the market due to current economic developments. The year 2009 was an extreme example of this, and at this point in time we can see no clear economic recovery in the markets we focus on. On the basis of recent investment in product innovation and marketing, however, we are confident that revenue - notwithstanding unforeseen circumstances - will increase in 2010. The structural savings resulting from the reorganisation of last year should begin to make a positive contribution to the profit in 2010 and thereafter. The annual report for 2009 will be published in early April, and the Annual General Meeting of Shareholders will be held on Thursday 29 April 2009 in the Hermitage Amsterdam, Nieuwe Keizersgracht 1, 1018 DR Amsterdam.
For more information: G.J.M. Ezendam
PROFILE NEDAP Nedap is characterised by a development- and entrepreneurship-orientated open, innovative and creative culture. Nedap's long-term policy is aimed at creating sustainable added value for customers, staff, and shareholders. It wants to achieve this through organic growth in revenue and profit where diversification and innovation, based on the company's expertise, play a central role. Nedap focuses on the development and supply of distinctive and sustainable
To continue operating in a manner that makes Nedap strong, it pursues an operating profit of at least 10% of the revenue, a return on equity of 15% to 20%, and a solvency level of approximately 45%. Nedap was founded in 1929 and has been listed on the NYSE Euronext since 1947.
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News |
| Half-yearly report 2010 |
| Press release half-year figures 2010 |
| Annual report 2009 |
| Press Release ´interim report´ |
| Press release financial results 2009 |