FRANCOTYP-POSTALIA GROWS EBITDA AND FREE CASH FLOW IN THE FIRST HALF OF 2010

Francotyp-Postalia Holding AG, a global service provider for professional mail management, was able to further increase its financial strength and profitability in the first half of 2010. On stable revenues and as a result of improved cost structures, the Company grew its EBITDA to EUR 12.8 million, compared to EUR 9.5 million for the corresponding period the year before. In the second quarter of 2010, EBITDA was EUR 5.7 million, compared to EUR 4.2 million for the corresponding quarter the year before.

The FP Group was also able to significantly improve its net income. In the first half of 2010, net income was EUR -0.87 million, partly because of declining depreciation expense compared to EUR -4.8 million for the corresponding period the year before. In the second quarter of 2010, the Company generated a break-even net income. In the corresponding quarter the year before, a net loss of EUR 2.8 million was still recorded. Free cash flow, the difference between cash flows from operating activities and cash flows from investing activities, also rose during the first half of the current fiscal year, amounting to EUR 4.9 million, compared to EUR 3.3 million for the corresponding period the year before. “The FP Group continues to benefit from its optimised cost structures and the restructuring programme that had been implemented in 2009,” explains the Group’s Chief Financial Officer, Hans Szymanski.

Revenues stood at EUR 66.0 million in the first half of 2010, compared to EUR 66.8 million for the previous quarter. In the second quarter of 2010, the Company generated revenues in the amount of EUR 32.4 million, compared to EUR 32.6 million for the second quarter of 2009. In this connection, recurring revenues from service agreements, leasing, the sale of consumables, as well as mail management services and software solutions remained stable compared with the previous year’s level. Revenues generated by the sale of franking and inserting machines slightly increased in the first half of 2010 to EUR 17.3 million, as opposed to EUR 17.2 million for the corresponding period the year before.

Guidance for 2010 confirmed

Given the anticipated course of business in the first half of 2010, which was characterised by stable revenues and improved cost structures, the FP Group confirms its guidance for the full fiscal year. The Company anticipates revenues between EUR 130 million and 135 million for the 2010 fiscal year, as well as an EBITDA between EUR 22 million to EUR 24 million, comparable to the EBITDA prior to last year’s restructuring. „In a challenging market environment, the FP Group will continue to focus on high-margin products and services with the aim of improving profitability in the long and medium term,“ states Szymanski. “In connection with sustained strict cost discipline, we are thus able to secure FP Group’s competitiveness long term and to open up new perspectives for the Company.“