Earnings Release • Oct 1, 2008
Earnings Release
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June 2008 – August 2008
P.O. Box 101, 5900 MA Venlo, the Netherlands, phone +31 77 359 22 40 Trade register Venlo number 12002283 Océ investor information on internet: http://www.investor.oce.com
Printing for Professionals
'The current turmoil in the world economy continues to put pressure on our revenues and margins. We are meeting this challenge by providing new, value adding products and services for our customers, enhancing operational excellence and continuously cutting costs aggressively. Our cost reduction program will achieve € 80 million savings in 2008 and an additional € 50 million savings in 2009. Year to date we reduced costs by € 59 million.
In the third quarter we continued to grow our revenues in the office, print room, display graphics and business services segments. This is a result of our consistent strategy to strengthen our product portfolio and cooperate with partners.
The financial services and construction markets are experiencing well publicized challenges. These developments are significantly impacting revenues from our continuous feed printers and technical document systems, the main cause of our decline in profitability.
Over the quarter, we have achieved rapid growth in color. We sold several multi-million euro Océ JetStream printers and many other color systems, including the recently launched Océ ColorWave 600.
The normalized operating income in the third quarter is positive. Due to one-off items the reported operating income is negative [- € 11.2 million].
In the current economic turmoil we refrain from giving an outlook for our full year income. We did however start the fourth quarter of 2008 with an order backlog comparable with last year. Continued cost savings are expected to amount to € 21 million in the fourth quarter. Supported by a strong focus on improving all working capital elements and by the anticipated sale of finance lease receivables, we expect a positive free cash flow for the 2008 full year.'
| Key figures | Third quarter | Nine months | ||||
|---|---|---|---|---|---|---|
| In million € / as % | 2008 | 2007 | Δ | 2008 | 2007 | Δ |
| Total revenues | 700.1 | 753.5 | –7.1% | 2,107.0 | 2,259.8 | –6.8% |
| Normalized operating income** | 16.8 | 21.2 | –20.7% | 54.5 | 72.1 | –24.4% |
| One-off items | –28.0 | – | – | –24.4 | –0.7 | – |
| Operating income [EBIT] | –11.2 | 21.2 | – | 30.1 | 71.4 | –57.9% |
| Normalized net income** | 1.7 | 12.6 | –86.3% | 20.6 | 43.6 | –52.7% |
| Net income | –23.7 | 12.6 | – | 3.0 | 43.1 | –93.0% |
* The figures in this report are unaudited.
** Adjusted for one-off items, representing continuing business.
Total revenues decreased organically by 1.5% if the non-core fax business is excluded. Non-recurring revenues, sales of printing systems and software, decreased 2.7%, due to continuing adverse conditions in the financial services and the construction sector. Recurring revenues excluding fax decreased 0.9%. During 2008 Océ acquired Intersoft whilst Arkwright and Océ Document Technologies were divested. Excluding these transactions recurring revenues were stable. Recurring revenues include services as well as sales of toners, inks and media, and represent some 70% of total revenues. An increasing part, currently 26%, of our total revenues relates to color.
Normalized operating income, representing the continuing business, amounted to € 16.8 million [2007: € 21.2 million], including a negative currency exchange impact of € 6 million. One-off items amounted to €28.0 million of which € 10.2 million restructuring charges; the remainder related to the sale of the loss making coating business of Arkwright, being a € 4.6 million book loss and the realization of € 13.2 million currency translation differences. Under IFRS, translation results on equity in subsidiaries denominated in non-euro currencies are recognized directly in Equity under the heading 'Currency Translation Differences'. Upon disposal of the subsidiary the accumulated translation results are realized via the Income Statement. This IFRS accounting rule has no impact on Equity or cash flow.
In Digital Document Systems [DDS] revenues generated by continuous feed systems declined as a consequence of the continued turmoil in the financial markets. DDS increased its revenues in cutsheet printing, driven by continued growth in the office and print room segment. As a result DDS improved its normalized operating income.
Océ Business Services [OBS] continued its revenue growth. Normalized operating income decreased, driven by continued investments at large new contracts as well as the slowdown of litigation services activities in the US.
The slowdown in the construction sector impacted revenues in Technical Document Systems and Imaging Supplies. Wide Format Printing Systems [WFPS] grew its revenues in the display graphics markets due to the success of its product portfolio. Normalized operating income declined as a result of lower revenues and start-up costs of the Océ ColorWave 600.
We started the fourth quarter of 2008 with an order backlog comparable with last year. Continued cost savings are expected to amount to € 21 million in the fourth quarter. Supported by a strong focus on improving all working capital elements and by the anticipated sale of finance lease receivables, we expect a positive free cash flow for the 2008 full year.
As an internationally operating company, Océ generates approximately 60% of its revenues outside the euro zone and is therefore exposed to fluctuations in exchange rates, especially the US dollar [USD] and the Pound sterling [GBP]. In the third quarter the very strong euro, which rose against the USD by 10.9% and the GBP by 14.8%, impacted the financial results. Océ acts to reduce exchange rate exposures amongst others via exchange rate hedges, relocating manufacturing activities and increased procurement in non-euro currencies.
Total revenues in the third quarter amounted to € 700.1 million, a decrease of 7.1%. Excluding exchange rate effects and the non-core fax business, revenues decreased organically by 1.5%.
Our share of color continues to grow and now accounts for 26% of revenues, up from 20% in the same period last year. The focus of our new product introductions is to continue to bring more color products to market in all of our business segments. Over the past year Océ launched the full color Océ JetStream series and Océ ColorStream 10000 continuous feed printers, the Océ ColorWave 600 and Océ Arizona 200 GT wide format printers, the Océ CS 650/620 cutsheet printers and various other color products serving the office market. Océ expects that color will continue to grow at a rapid pace and will become a much larger part of the revenue stream going forward.
Non-recurring revenues amounted to € 219.5 million, decreasing by 7.2%. The adverse conditions in the financial services and the construction sector impacted sales, resulting in an organic revenue decrease of 2.7%, compared to the very strong third quarter of 2007 [in which non-recurring revenues rose 17.9%].
Recurring revenues amounted to € 480.6 million, decreasing by 7.0%. Excluding fax, organic recurring revenues decreased 0.9%. Excluding the acquisitions and divestments, the recurring revenues were stable.
Océ has an ongoing operational excellence program to improve business processes which will enhance customer service, shorten equipment delivery times and reduce costs. In 2008, in response to the weak economic situation, Océ accelerated the cost savings program in order to improve profitability. The operational excellence objective is to reduce expenses by € 80 million in 2008 and by an additional € 50 million in 2009. Year to date Océ achieved € 59 million savings. The total program includes a reduction of 950 job positions of which year-to-date 560 have been realized. In the third quarter some 280 positions were eliminated whilst € 10.2 million in restructuring expenses were incurred. In the third quarter Océ sold the loss making coating related activities of Arkwright in the US. The sale resulted in a book loss of € 4.6 million and the realization of € 13.2 million currency translation differences. Under IFRS, translation results on equity in subsidiaries denominated in non-euro currencies are recognized directly in Equity under the heading 'Currency Translation Differences'. Upon disposal of the subsidiary the accumulated translation results are realized via the Income Statement. This IFRS accounting rule has no impact on Equity or cash flow.
In total, one-off items amounted to € 28.0 million of which € 4.6 million impacted gross margin and € 23.4 million impacted operating expenses.
Normalized gross margin, excluding one-off items, was 38.1% [2007: 39.1%1 ]. Volume/mix effects and exchange rate effects caused a decline of 0.8% point. The sale of Océ Document Technologies and Arkwright accounted for a decline of 0.2% point.
1] In 2008 and in the comparative figures for 2007 the transportation costs from distribution center to customer are fully included in the gross margin.
Normalized operating expenses amounted to 35.7% [2007: 36.3%]. This decrease was realized by vigorous execution of the operational excellence program. Net capitalized R&D costs amounted to € 3.9 million [2007: € 3.6 million].
On balance, normalized operating income amounted to € 16.8 million [2007: € 21.2 million]. The strong euro caused a negative currency exchange impact of € 6 million. Operating income amounted to – € 11.2 million [2007: € 21.2 million].
Financial expenses [net] amounted to € 11.3 million [2007: € 10.1 million].
Taxation was € 1.3 million [2007: € 1.3 million contribution to net income].
On balance, normalized net income was € 1.7 million [2007: € 12.6 million].
The balance sheet total was € 2,378 million, compared with € 2,573 million at the end of the third quarter of 2007. The year-on-year change was mainly attributable to a reduction in accounts receivable, lower cash balances, the sale of fixed assets and exchange rate effects.
The net debt/EBITDA ratio amounted to 2.3 which is within the aspired bandwidth of 2.0 to 2.5 and well below the maximum in the loan covenants.
Net Capital Employed was € 1,292 million, compared to € 1,371 million at the end of the third quarter of 2007. In relation to normalized operating income, RoCE amounted to 6.6% [2007: 6.8%].
Free cash flow in the third quarter was – € 17 million [2007: € 23 million]. Cash flow from operating activities, – € 6 million, was adversely affected by higher finance lease receivables, reflecting the situation in the financial markets, and lower accounts payable. The cash flow from investing activities, – € 11 million, reflected higher expenditures both in intangible assets and Property, plant and equipment.
Océ has taken action to improve the free cash flow including an increased focus on inventories, accounts receivable and accounts payable. Océ also intensified its action to reduce out-of-pocket expenses and reduce the finance lease receivables.
| In million € / as % | DDS | OBS | WFPS | Total |
|---|---|---|---|---|
| Revenues | 395.7 | 101.1 | 203.3 | 700.1 |
| Organic growth in revenues, excl. fax | –1.7% | 5.9% | –4.5% | –1.5% |
| Non-recurring revenues | 144.8 | – | 74.7 | 219.5 |
| Organic growth in non-recurring revenues | –2.0% | – | –3.9% | –2.7% |
| Recurring revenues | 250.9 | 101.1 | 128.6 | 480.6 |
| Organic growth in recurring revenues, excl. fax | –1.5% | 5.9% | –4.8% | –0.9% |
| Normalized operating income* | 1.6 | 0.8 | 14.4 | 16.8 |
| One-off items | –8.3 | –0.1 | –19.6 | –28.0 |
| Operating income | –6.7 | 0.7 | –5.2 | –11.2 |
* Adjusted for one-off items, representing continuing business. One-off items comprise restructuring charges and for WFPS also € 17.8 million related to the sale of Arkwright.
Revenues in DDS amounted to € 395.7 million. Organically and excluding fax, revenues decreased by 1.7%. DDS grew its revenues in cutsheet systems. The revenue related to continuous feed systems declined following mainly the developments in the financial services sector.
The share of color increased to 23% of revenues [2007: 17%].
Non-recurring revenues amounted to €144.8 million. Revenues decreased organically by 2.0%. Excluding the divestment of Océ Document Technologies nonrecurring revenues declined 0.7%, compared to the very strong third quarter of 2007 [in which nonrecurring revenues rose 16.5%]. DDS increased the sales of cutsheet equipment. The sales of continuous feed systems decreased as a result of a decline in the worldwide market.
The growth in cutsheet was achieved through our expanded distribution power and the competitive office product portfolio sourced via our strategic
alliance with Konica Minolta. In the productive cutsheet segment DDS again increased its installed base for both color and Océ VarioPrint 6xxx equipment. In the third quarter DDS introduced the Océ VarioPrint 1105 and the Océ VarioPrint 4000, which will fuel further growth in cutsheet printing.
Worldwide the market for continuous feed systems declined in 2008, reflecting ongoing developments in the financial sector. As a result, DDS placements in the third quarter declined compared to the same period of the previous year. DDS has a highly professional and appreciated sales and service force organization and a competitive product portfolio for continuous feed systems. DDS maintained its market share and increased its installed base of continuous feed systems. DDS is confident of maintaining its strong position thanks to our continuous feed order book as well as the new successful full color portfolio. This portfolio
consists of the Océ VarioStream 9240, the Océ ColorStream 10000 and the Océ JetStream series for which DDS booked several substantial orders in the third quarter.
Recurring revenues amounted to € 250.9 million. In the third quarter organic recurring revenues, excluding fax, decreased by 1.5%. DDS grew its volume of invoiced prints both for black-and-white and color prints. As a result the recurring revenues related to cutsheet equipment increased in the quarter.
Recurring revenues related to continuous feed systems decreased due to declining print levels, mainly following developments in the financial services sector.
Normalized operating income amounted to € 1.6 million [2007: – € 4.0 million]. DDS achieved this improvement by growing its business in the office segment and productive cutsheet printing.
Revenues in OBS amounted to € 101.1 million. Organic growth was again strong with 5.9%. OBS shows consistent growth as the trend to outsource document management activities continues.
Hertz Corp. has selected Océ Business Services to provide global document process outsourcing services. Océ will provide a range of services that span the document lifecycle [creation through disposal] to help Hertz achieve its efficiency enhancement goals, for example by changing the manual document management process into an electronic flow. This assignment is a five year multimillion dollar international contract encompassing North America and Europe, and the OBS operations center in the Philippines.
Normalized operating income amounted to € 0.8 million [2007: € 3.2 million]. The growth of OBS requires continued customer start-up investments. Furthermore the slowdown of litigation services activities in the US negatively impacted profitability. OBS has taken actions to restore profitability including a change in management structure and
increased focus on business growth at existing customers.
Revenues in WFPS amounted to € 203.3 million. On an organic basis the revenue decrease was 4.5%. The share of color increased to 34% of revenues significantly higher than the 28% in the third quarter of last year.
Non-recurring revenues amounted to € 74.7 million. The organic decrease was 3.9%. Excluding the acquisition of Intersoft the decline was 7.1% compared to the very strong third quarter of 2007 [in which non-recurring revenues rose 20.8%]. This decline was caused by lower equipment sales in Technical Document Systems following the slowdown in the construction sector. WFPS continued to ramp up the production of the new, much demanded, Océ ColorWave 600. As announced earlier the Océ ColorWave 600 contribution to 2008 revenues will be limited. In the display graphics market WFPS grew its equipment sales as a result of its enhanced product portfolio, e.g. the new Océ Arizona Roll Media option and the initial sales of the new Océ Arizona 200 GT. The Océ Arizona 250 GT continued to sell well.
Recurring revenues amounted to € 128.6 million. The organic decrease was 4.8%. Excluding the acquisition of Intersoft and the divestment of Arkwright the decline was 3.0%, caused mainly by lower print volumes in the construction market. WFPS grew its revenues in the display graphics segment. On balance revenues relating to the installed base were in line with the third quarter of 2007 and the decline in recurring revenues was mainly attributable to lower media [especially wide format paper] sales in Imaging Supplies.
Normalized operating income was € 14.4 million [2007: € 22.0 million]. The decline was mainly caused by lower revenues and start-up costs of the Océ ColorWave 600.
For 2008 Océ will pay an interim dividend of € 0.15 per ordinary share outstanding [2007: € 0.15]. The ex-dividend date is October 2, 2008. The interim dividend will be payable in cash from October 21, 2008. The proposal with respect to the final dividend will be announced in January together with the provisional results for the full financial year 2008.
In the current economic turmoil we refrain from giving an outlook for our full year income. We did however start the fourth quarter of 2008 with an order backlog comparable with last year. Continued cost savings are expected to amount to € 21 million in the fourth quarter. Supported by a strong focus on improving all working capital elements and by the anticipated sale of finance lease receivables, we expect a positive free cash flow for the 2008 full year.
Board of Executive Directors Océ N.V. October 1, 2008
Non-recurring revenues: revenues from the sale of machines, software and professional services. Organic growth: the development of the results after adjustment for exchange rate effects and the impact of substantial acquisitions or disposals. Recurring revenues: revenues from services, inks, toners, media, rentals, interest and business services. RoCE: Return on Capital Employed: operating income on an annual basis after normalized taxes [20%] as a percentage of average Net Capital Employed [total assets excluding cash and cash equivalents, less non-interest bearing liabilities adjusted for derivatives.]
Wide Format printing: wide format printing [bigger than A3].
For further information: Investor Relations: Carlo Schaeken, Vice President Investor Relations Phone +31 77 359 2240, e-mail [email protected]
Jan Hol, Senior Vice President Corporate Communications Phone +31 77 359 2000, e-mail [email protected]
| Third quarter | Nine months | |||
|---|---|---|---|---|
| In million € | 2008 | 2007 | 2008 | 2007 |
| Total revenues | 700.1 | 753.5 | 2,107.0 | 2,259.8 |
| Cost of sales | –437.8 | –458.9 | –1,294.9 | –1,364.1 |
| Gross margin | 262.3 | 294.6 | 812.1 | 895.7 |
| Selling and marketing expenses | –153,1 | –165.6 | –472.4 | –506.3 |
| Research and development expenses | –54.6 | –61.4 | –165.0 | –175.7 |
| General and administrative expenses | –48.0 | –46.4 | –147.5 | –142.3 |
| Other income, gains/losses | –17.8 | – | 2.9 | – |
| Operating expenses | –273.5 | –273.4 | –782.0 | –824.3 |
| Operating income | –11.2 | 21.2 | 30.1 | 71.4 |
| Financial income | 1.2 | 5.1 | 9.4 | 14.7 |
| Financial expenses | –12.5 | –15.2 | –38.5 | –43.5 |
| Share in income of associates | 0.1 | 0.2 | 0.3 | 0.4 |
| Income before income taxes | –22.4 | 11.3 | 1.3 | 43.0 |
| Income taxes | –1.3 | 1.3 | 1.7 | 0.1 |
| Net income | –23.7 | 12.6 | 3.0 | 43.1 |
| Net income attributable to | ||||
| Shareholders | –24.2 | 12.2 | 1.7 | 41.8 |
| Minority interest | 0.5 | 0.4 | 1.3 | 1.3 |
| –23.7 | 12.6 | 3.0 | 43.1 | |
| Free cash flow | –17.1 | 23.2 | –123.3 | –17.3 |
| Average number of ordinary shares outstanding [x 1,000] | 84,813 | 84,441 | 84,777 | 84,183 |
| Earnings per ordinary share for net income attributable to | ||||
| shareholders in € | ||||
| Basic | –0.29 | 0.14 | 0.00 | 0.47 |
| Consolidated Balance Sheet | August 31, 2008 | November 30, 2007 | |
|---|---|---|---|
| In million € | |||
| Assets | |||
| Non-current assets | Intangible assets | 535 | 512 |
| Property, plant and equipment | 357 | 374 | |
| Rental equipment | 103 | 108 | |
| Investments in associates | 2 | 2 | |
| Deferred income tax assets | 86 | 87 | |
| Available-for-sale financial assets | 10 | 9 | |
| Derivative financial instruments | – | 5 | |
| Trade and other receivables | 201 | 184 | |
| 1,294 | 1,281 | ||
| Current assets | Inventories | 372 | 328 |
| Derivative financial instruments | 8 | 12 | |
| Trade and other receivables | 644 | 684 | |
| Current income tax receivables | 13 | 8 | |
| Cash and cash equivalents | 39 | 167 | |
| 1,076 | 1,199 | ||
| Non-current assets held for sale | 8 | 11 | |
| Total | 2,378 | 2,491 | |
| Equity and Liabilities | |||
| Equity | Share capital | 54 | 54 |
| Share premium | 512 | 512 | |
| Other reserves | –159 | –176 | |
| Retained earnings | 225 | 210 | |
| Net income attributable to shareholders | 2 | 77 | |
| Equity attributable to shareholders | 634 | 677 | |
| Minority interest | 35 | 36 | |
| 669 | 713 | ||
| Non-current liabilities | Borrowings | 571 | 536 |
| Derivative financial instruments | 15 | 15 | |
| Retirement benefit obligations | 393 | 414 | |
| Trade and other liabilities | 6 | 12 | |
| Deferred income tax liabilities | 17 | 15 | |
| Provisions for other liabilities and charges | 43 | 49 | |
| 1,045 | 1,041 | ||
| Current liabilities | Borrowings | 76 | 64 |
| Derivative financial instruments | 8 | 1 | |
| Current income tax liabilities | 16 | 24 | |
| Trade and other liabilities | 548 | 632 | |
| Provisions for other liabilities and charges | 16 | 16 | |
| 664 | 737 | ||
| Total | 2,378 | 2,491 |
| Consolidated Statement of Changes in Equity attributable to shareholders In million € |
Nine months 2008 | Financial year 2007 |
|---|---|---|
| Balance at December 1, 2007 / 2006 | 677 | 684 |
| Net income attributable to shareholders | 2 | 77 |
| Dividend | –44 | –52 |
| Share-based compensation | 1 | 13 |
| Purchase of treasury shares | – | – |
| Repurchased shares | – | – |
| Cash flow hedges | –7 | –3 |
| Currency translation differences | 5 | –42 |
| Balance at August 31, 2008 / November 30, 2007 | 634 | 677 |
| Third quarter 2008 | Nine months 2008 | |||
|---|---|---|---|---|
| As percentage | excluding fax | including fax | excluding fax | including fax |
| Non-recurring revenues | ||||
| Digital Document Systems | –2.0 | –2.0 | –3.0 | –3.0 |
| Océ Business Services | – | – | – | – |
| Wide Format Printing Systems | –3.9 | –3.9 | 2.6 | 2.6 |
| Total | –2.7 | –2.7 | –1.1 | –1.1 |
| Recurring revenues | ||||
| Digital Document Systems | –1.5 | –2.6 | –1.3 | –2.7 |
| Océ Business Services | 5.9 | 5.9 | 5.8 | 5.8 |
| Wide Format Printing Systems | –4.8 | –4.8 | –2.6 | –2.6 |
| Total | –0.9 | –1.6 | –0.2 | –1.0 |
| Total revenues | ||||
| Digital Document Systems | –1.7 | –2.4 | –1.9 | –2.8 |
| Océ Business Services | 5.9 | 5.9 | 5.8 | 5.8 |
| Wide Format Printing Systems | –4.5 | –4.5 | –0.8 | –0.8 |
| Total | –1.5 | –1.9 | –0.5 | –1.0 |
| Nine months 2008 | Nine months 2007 | |
|---|---|---|
| In million € | ||
| Income before income taxes | 1 | 43 |
| Adjustments for: | ||
| Depreciation and amortization | 136 | 151 |
| Impairment | – | – |
| Share-based compensation | –4 | 5 |
| Share in income of associates | – | – |
| Other | 2 | –1 |
| Changes in provisions, rental equipment and working capital: | ||
| Retirement benefit obligations | –5 | –4 |
| Provision for other liabilities and charges | –4 | –18 |
| Other provisions [for inventories, finance lease and trade receivables] | 27 | 18 |
| Rental equipment | –43 | –54 |
| Inventories | –66 | –57 |
| Finance lease receivables | –25 | 22 |
| Trade and other receivables [excluding finance lease receivables] | 32 | 4 |
| Trade and other liabilities | –77 | –43 |
| Income taxes | –10 | 4 |
| Cash flow from operating activities | –36 | 70 |
| Investment in intangible assets | –45 | –33 |
| Investment in property, plant and equipment | –61 | –63 |
| Divestment in intangible assets | – | 1 |
| Divestment in property, plant and equipment | 6 | 7 |
| Change in other non-current assets | –1 | –4 |
| Change in investments in associates | – | – |
| Sale finance lease portfolio | 6 | 7 |
| Divestments/acquisitions | 8 | –2 |
| Cash flow from investing activities | –87 | –87 |
| Free cash flow | –123 | –17 |
| Proceeds from borrowings | 60 | 78 |
| Repayments of borrowings | –10 | –30 |
| Dividend | –44 | –38 |
| Change in equity related to shares | 1 | 10 |
| Change in minority interest | –2 | –3 |
| Cash flow from financing activities | 5 | 17 |
| Currency translation differences | –10 | –2 |
| Changes in cash and cash equivalents | –128 | –2 |
| Cash and cash equivalents at start of reporting period | 167 | 85 |
| Cash and cash equivalents at end of reporting period | 39 | 83 |
Océ innovative by nature Océ is a leading worldwide supplier of professional printing and document management systems. A business that is innovative by nature, both commercially and technologically. Océ develops and manufactures systems for the production, distribution and management of documents, in color and black-and-white, in small format and in wide format, for users in offices, education, industry and the graphic arts market. The product offerings comprise printers, scanners, peripheral equipment and printing media but also document management software and innovative products in the areas of system integration, the outsourcing of document management activities and the leasing of printing systems. Océ's core product range, developed and manufactured by the company itself, focuses on the small format and wide format and, within the small format, on the [very] high volume segments. To supplement this, Océ offers its customers selected systems sourced from Original Equipment Manufacturers [OEMs], often as part of total solutions.
Océ's reputation is founded on productivity and reliability, ease of use and a favorable 'total cost of ownership'.
Océ is commercially active in over 90 countries; in more than 30 of these it has its own sales and service organization. In Europe, North America and Asia, Océ also operates 9 own research and manufacturing facilities. In 2007 Océ, which had nearly 24,000 employees, achieved revenues of € 3.1 billion and a net income of € 78.9 million.
Business model Océ is one of the few suppliers that is active in the entire value chain of printing systems: from development via manufacturing, sales and financing to service. Thanks to constant feedback within the chain Océ is able to anticipate and respond alertly to changing market requirements and new market opportunities. Océ's policy is steered in the various sub-markets by three Strategic Business Units: Digital Document Systems [DDS] for the small format, Océ Business Services [OBS] for document-related services and Wide Format Printing Systems [WFPS] for the wide format, in close co-operation with Research & Development on the one hand, and Marketing & Sales on the other.
DDS serves the market via Document Printing and Production Printing. OBS serves the market geographically in Europe and the United States. WFPS via the Technical Document Systems, Display Graphics Systems and Imaging Supplies business groups.
A separate activity, Software & Professional Services, concentrates on development and implementation of software in printing systems and therefore supports all business groups. In a number of countries in which Océ itself is not represented the business offers part of the product range via specialized distributors. Via its own Research & Development Océ itself develops its basic technologies and the majority of its product concepts. The direct feedback of customer experience serves here as an important source of inspiration for concrete, current and future solutions. Océ also broadens and strengthens its innovative capacity via alliances with strategic partners and co-operation with codevelopers and with OEMs for printing systems in the high, medium and low volume segments.
The publicly listed holding company of the Group is Océ N.V. The issued share capital amounts to around € 53.7 million, divided into € 43.7 million ordinary shares and € 10 million financing preference shares with a nominal value of € 0.50 each.
The ordinary shares of Océ are listed on the stock exchange in Amsterdam [NYSE Euronext]. Options to Océ shares are traded on the Euronext Options Exchange.
This report contains information as meant in article 5:59 jo. 5:53 of the Dutch "Law on financial supervision" [Wet op het financieel toezicht].
Forward-looking statements, which can form a part of this report refer to future events and may be expressed in a variety of ways, such as 'expects', 'projects', 'anticipates', 'intends' or other similar words ['Forward-looking statements'].
Océ N.V. ["Océ"] has based these forward-looking statements on its current expectations and projections about future events. Océ's expectations and projections may change and Océ's actual results, performance or achievements could be significantly different from the results expressed in or implied by these forward-looking statements based on various important factors, risks and uncertainties which are neither manageable nor foreseeable by Océ and some of which are beyond Océ's control.
When considering these forward-looking statements, one should keep in mind these risks, uncertainties and other cautionary statements made in this report or in Océ's other annual or periodic filings.
For a more detailed discussion of these not limited factors, risks and uncertainties that may affect Océ's actual results, performance or achievements, reference is made to the annual report and any other publications made by Océ.
Given these uncertainties no certainty can be given about Océ's future results or financial position. We advise you to be careful with Océ's forward-looking statements, which speak only as of the date on which the statements are made. Océ is under no obligation to update or revise publicly any forward-looking statement, whether as a result of new information, future events or otherwise, except as may be required under applicable [securities] laws.
Océ enables its customers to manage their documents efficiently and effectively by offering innovative print and document management products and services for professional environments.
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