Written by • At around 1.64 billion euros, sales revenue in fiscal 2011 just below the high level of 2010
• Consolidated net income at 52.4 million euros
• First major orders in new areas of business
• Increased investment in research and development
• Sales and earnings set to rise again in fiscal 2012
At around 1.64 billion euros, G&D Group sales in fiscal 2011 were just below the high levels of previous years. Earnings before interest and income taxes (EBIT) for 2011 amounted to 92.3 million euros, while the company posted consolidated net income of 52.4 million euros. The difficult economic climate in key G&D markets, the postponement of investment decisions by customers owing to political uncertainty, and a dramatic hike in cotton prices all weighed heavily on the 2011 result.
As in previous years, G&D financed its successful innovation strategy entirely with its own funds. Investment in research and development rose by 2 percent in the year under review to 119 million euros or the equivalent of 7.3 percent of Group sales, indicating how G&D is exploiting the opportunities for growth presented by the fast pace of innovation in its markets.
“We have always been there at the right time with the right vision and technology, ready to tap new markets and achieve success. In 2011, we systematically pursued that innovation strategy,” said Dr. Karsten Ottenberg, Chairman of the Management Board and CEO of Giesecke & Devrient. “Even in the face of testing global economic conditions, Group earnings still exceeded our cost of capital, meaning we again generated enterprise value for G&D,” he added. “Initial successes in our new areas of business show that our investments in promising technologies are paying off.”
The Banknote business unit grew its sales by 3.8 percent to 781 million euros. The Banknote Processing division was the main driver of this growth, achieving an increase in sales in 2011 over the already high level of the previous year.
Rising demand for electronic ID solutions fueled substantial year-on-year growth in the Government Solutions business unit too, where like-for-like sales rose by 14.4 million euros or 7.9 percent to 197.1 million euros. The business unit’s German portfolio – which mainly comprises the new German ID card, electronic residence permits, and the electronic healthcare card – grew substantially. Electronic ID card business in Brazil also contributed to this robust growth.
Sales in the Mobile Security business unit in 2011 weighed in at 657.1 million euros, which amounts to a 12.7 percent decline compared with the high level of 2010. One of the main reasons for this fall was the end of the one-off boom in payment cards in 2010 triggered by the migration to EMV chips in several large markets. The Mobile Security business unit continues to invest in innovative solutions.
“We intend to enhance both our revenue and our profits once again in fiscal 2012,” said Ottenberg. “Revenue is forecast to top the 1.7 billion euro mark, while EBIT should again be well over 100 million euros. Our first-quarter figures in 2012 confirm this trend.”