With a boost in earnings and strong sheetfed orders, KBA is expected to reward shareholders with a 40 cent dividend.

The company says group sales were up 10.9 per cent at 1.29 billion Euros, leading to an operating profit of 43.1 million Euros, four times that for the previous year. While the order backlog was lower than 2011’s record, sheetfed orders jumped by 17.1 per cent.

Financial statements for 2012 show earnings before and after tax were higher than in 2011, despite a considerable one-off special depreciation. The 40 cents per share dividend will be proposed at the annual meeting June 13.

“Despite newspaper, illustration and magazine printers’ reluctance to invest, sales in the web and special press division increased 11.5 per cent to 650.7 million Euros driven by strong business in special presses,” the report says. New orders were down 28.1 per cent, however.

KBA says cost-cutting measures and higher contribution margins from a rise in sales and the growth in service and special press turnover contributed to the 43.1 million Euros operating profit before special items amounting to a similar amount. KBA’s sheetfed division was affected by a one-off special depreciation on fixed assets of 27.1 million Euros. Following this, group operating profit stood at 16 million Euros.

Cash flow remains high despite the cost of major projects and decline in new web orders, meaning free cash flow now exceeds bank loans.

“The world’s second-largest press manufacturer’s financial and balance sheet ratios positively outperform other companies in the industry,” says the report. The group spent about 4.5 per cent of its turnover on research and development.

Lower domestic sales nudged the proportion of exports to 88.2 per cent, with the Asia-Pacific growth region, pushed by China, contributing to 24.1 per cent. A boost in sheetfed sales is expected from China Print, now the world’s second-largest trade show.

In the outlook for 2013, KBA management refers to the unstable market environment, ongoing consolidation in the printing press industry and further risks, such as exchange rate developments, which make longer-term forecasts difficult. A “slight decline” in sales for web presses and security printing systems will have to be counteracted with cost-cutting measures in the web division.

Pictured: A new Commander CL press at Heart Corporation’s Times Union newspaper in Albany, New York, bucked the trend in the North American industry. Publisher George R. Hearst III and director of operations Dan Couto are pictured during the official inauguration on March 19