Francotyp-Postalia Holding AG, a Digital Mailroom provider, has started the fiscal year 2016 as expected. In the traditionally strong first quarter, the company increased its revenues by 3.7% to €51.3 million. Despite a growing headwind from the stronger euro, the company asserted itself in the traditional business with franking machines. Here, revenues amounted to €32.2 million compared to €32.3 million in the same period of the previous year. This stable performance was primarily the result of the ongoing strong demand for the PostBase franking system. Following the successful introduction of the PostBase One and PostBase 100 franking systems in Germany, their introduction in key countries – the US and the UK – is also planned for the current year. In the new business areas, the FP Group increased its revenues by 11.6% to €19.1 million in the first quarter of 2016. The Mail Services segment relating to the collection, franking, sorting and delivery of postage discounted business mail was a key contributor to this success. Revenues increased here by 15.0% to €15.3 million, also as a result of the increase in postal charges as of 1 January 2016. Revenues in the Software segment remained at the previous year’s level of €3.9 million.
Operating result at the previous year’s level
In the first quarter of 2016, the FP Group achieved EBITDA of €8.2 million and thus repeated the strong quarterly figures of the previous year. As expected, depreciation and amortisation rose by €0.2 million to €4.2 million in this period. Operating earnings (EBIT) remained at the level of the previous year (€4.0 million).
The other financial result fell to €0.1 million compared to €1.8 million in the same period of 2015. In the previous year, the FP Group particularly benefited from positive exchange rate effects on the revaluation of consolidated balance sheet items at the end of the reporting period. The FP Group thus generated consolidated net income of €2.5 million in the first quarter 2016 after €3.5 million in the previous year’s first quarter. Earnings per share (undiluted) reached 15 cents after 21 cents in the first quarter of 2015.
Positive free cash flow in the first quarter
Thanks to its innovative product portfolio, the FP Group has been successful, especially on leasing markets. In the first quarter of 2016, investments, particularly in leased inventories and capitalised development cost, amounted to €4.2 million after €5.0 million in the previous year. Cash flows from investing activities were offset by cash flows of €5.9 million from operating activities in the first quarter of 2016. Free cash flow reached €1.6 million, compared with €2.6 million in the previous year.
FP Group confirms forecast
As announced in April 2016, the FP Group is focusing on strengthening its profitability, continuously developing the traditional business with franking systems and expanding its new business areas in the current fiscal year. On the assumption that exchange rates remain unchanged, the company continues to anticipate a slight increase in revenues and EBITDA in addition to positive free cash flow for 2016 as a whole.
FP Group CEO, Rüdiger Andreas Günther, explains: “Our company started 2016 as expected – but we could be even better. This is why we are sharpening our growth strategy this year and will initiate measures in line with operational excellence. Our company is characterised by a unique mix of longstanding expertise in mail processing and digital know-how. We therefore see opportunities to both grow against the market trend in our traditional business and significantly advance on the markets of the future. This is what we want and this is what we will become.”
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