GLUNZ & JENSEN HOLDING A/S Glunz & Jensen Holding A/S; Selandia Park 1, 4100 Ringsted, Denmark CVR 10239680
GLUNZ & JENSEN
Glunz & Jensen is a supplier of innovative, high-quality plate making equipment and solutions for the global prepress industry. In addition to developing and producing processing equipment for Offset and Flexo printing technologies, we also offer premier customer support as well as a full range of spare parts, wear parts and consumable products. Our diverse product portfolio includes inkjet imaging systems, exposure units, wash out units (processors), dryers, light finishers, full- automatic platemaking (inline) systems, mounting tables, plate stackers & turners.
Our R&D, supply chain, production, testing, and training facilities are in Presov, Slovakia, and our products are based on application know-how and own developed technology. In addition, we have an R&D and test facility in Odense, Denmark, working on unique applications and technology for our single largest customer.
Glunz & Jensen has been operating in prepress for more than 50 years. We have long-standing relations with major industry leading companies such as Asahi, DuPont, ECO3, Fuji Film, Heidelberg, KBA, Kodak, MacDermid, Miraclon, TechNova and more. We market our products and solutions globally through a well-established, comprehensive, and worldwide network of distributors and dealers. We have approx. 114 employees in our facilities in Denmark, Slovakia and the USA.
We are on the path to be the most innovative high-end equipment and services provider, delivering outstanding value for money in our product areas, and thereby growing our market share with our global partners. We are also set to strengthen our earnings through improved trade profitability and optimized manufacturing including within procurement and supply chain.
The segment Prepress consists of two product areas described below:
OFFSET | FLEXO | |
Products | CtP and iCtP technology solutions | Flexographic (Thermal and Solvent) |
which prepare Offset plates for Offset | technology solutions which expose, | |
printing together with aftermarket | process and handle plates for Flexo | |
services. | printing together with aftermarket | |
services. | ||
Primary applications | Commercial printing - production of | Labels & Packaging industry |
newspapers, magazines, books, flyers, | ||
business cards, stationary etc. | ||
Share of revenue | Approx. 52% of Prepress | Approx. 48% of Prepress |
Main sales channels | Through large customers such as Fuji | Through large customers such as |
Film, Kodak, Heidelberg, Technova, | DuPont, KBA, MacDermid, Miraclon, | |
and multiple large dealers | and multiple large dealers | |
Markets | Global | Global |
Main market drivers | Maintain a high-end suite of innovative | Improve technological solutions and |
products and solutions in close | automation of prepress production | |
cooperation with key customers as well | processes in close cooperation with | |
as ongoing consolidation to maintain | customers. There will be focus on | |
critical mass. Limited brand-new sites | developing environmentally friendly | |
but an abundance of replacement sales | solutions which improves performance, | |
to existing accounts as well as | through longer lifetime, higher | |
competitive accounts capturing. In the | efficiencies, and lower emissions | |
past the addressable market has | impact and energy consumption. Key | |
witnessed significant consolidation as | technology convergence from Gravure | |
well as migration towards process-less | and Offset in packaging in particular | |
plate technologies as well as print | onto Flexo technology drives | |
output via digital technology solutions. | expectation for growth in years ahead. |
Besides the main segment Prepress Glunz & Jensen reports and operates within the segment investment property, Selandia Park.
ANNUAL REPORT 2023 | Page | 1 |
TABLE OF CONTENTS | |
RISK FACTORS | 13 |
REPORTING ON MANAGEMENT | 15 |
STATEMENT ON CORPORATE SOCIAL RESPONSIBILTY AND GENDER DIVERSITY | 19 |
SHAREHOLDER INFORMATION | 24 |
BOARD OF DIRECTORS AND EXECUTIVE MANAGEMENT | 26 |
GROUP COMPANIES | 28 |
STATEMENT BY THE BOARD OF DIRECTORS AND THE EXECUTIVE MANAGEMENT | 29 |
INDEPENDENT AUDITOR'S REPORT | 30 |
INCOME STATEMENT | 34 |
STATEMENT OF COMPREHENSIVE INCOME | 34 |
BALANCE SHEET | 35 |
STATEMENT OF CHANGES IN EQUITY | 37 |
STATEMENT OF CASH FLOWS | 38 |
NOTES | 39 |
DEFINITIONS OF RATIOS | 64 |
The consolidated financial statements are presented in compliance with International Financial Reporting Standards (IFRS) as adopted by the EU and additional requirements in the Danish Financial Statements Act. The registered office of Glunz & Jensen Holding A/S is in Denmark. References to the future in the annual report reflect Management's current expectations as to future events and financial results. References to the future are associated with uncertainty, and the results achieved may therefore deviate from the expectations stated in the annual report. Circumstances which may imply that results achieved differ from expectations are, e.g., developments in the business cycle and financial markets, including economic developments in the world, wars, pandemics, changes in laws and regulations affecting Glunz and Jensen Holding A/S' business areas and markets, trends in demand for products, competitive and supplier relationships, and energy and commodity prices. See also the sections on risk factors in the annual report.
Page | 2 | ANNUAL REPORT 2023 |
HEADLINES FOR 2023
- The accounting period in 2023 is from January 1st to December 31st, hence covering a 12-month period. The accounting period in 2022 is from April 1st to December 31st, hence covering a 9-month period only. Unless otherwise stated, all references to 2022 cover a 9-month period, whereas all references to other years are based on periods consisting of a 12-month period. The reader should be cautious in comparing 2022 to 2023 or to previous years.
- Revenue in Glunz & Jensen Holding A/S came to DKK 143,3 million in 2023 vs. DKK 103,4 million in 2022. Revenue in Selandia Park increased from DKK 9,7 million in 2022 to DKK 11,2 million in 2023. Revenue is in line with our expectations announced to the market on November 21st, 2023, as revenue then was guided at approximately DKK 145 million.
- Gross profit totaled DKK 31,9 million (2022: DKK 27,5 million), and the gross profit margin decreased to 22,2%
(2022: 26,6%). - Profit before financial income and expenses, tax, depreciation, amortization, and impairment of assets, - the EBITDA, was DKK 10,8 million (2022: DKK 18,2 million). The EBITDA is in line with our expectations announced to the market on November 21st, 2023, as it was then guided at approximately DKK 11 million.
- As a result of sharply increased interest rates, financing costs increased with DKK 2,8 million during 2023.
- Profit for the year before tax totaled DKK 3,5 million (2022: DKK 15,3 million). This is in line with the expectations announced to the market on November 21st, 2023, as profit for the year before tax was then expected at approximately DKK 5 million. The profit for the year before tax is not considered satisfactory.
- Profit for the year totaled DKK 2,9 million (2022: DKK 12,0 million), equal to a profit in earnings per share (EPS)
of DKK 1,6 in 2023 (2022: DKK 6,6 per share). - Net cash flows from operating activities came at DKK 13,9 million (2022: DKK -9,3 million), net investments were
DKK -0,7 million (2022: DKK -1,4 million), and cash flow from financing activities were DKK 13,0 million (2022:
DKK -10,6 million). Free cash flows at year-end were DKK 13,3 million (2022: DKK -10,7 million). - The Board of Directors recommends not to distribute dividend for 2023.
ANNUAL REPORT 2023 | Page | 3 |
GLUNZ & JENSEN HOLDING A/S LOCATIONS
Glunz & Jensen Prepress currently has 4 locations:
Ringsted, Denmark including headquarter, administration, finance, sales and service. In addition, there is a branch office in Odense, Denmark hosting Thermal R&D.
Presov, Slovakia including administration, finance, R&D, internal sales, supply chain, Offset and Flexo manufacturing and global spare parts center.
Inman, SC, USA including service and regional spare parts center.
The investment properties in Selandia Park A/S are in Ringsted, Denmark.
Page | 4 | ANNUAL REPORT 2023 |
MANAGEMENT'S REVIEW
FINANCIAL HIGHLIGHTS
DKK | DKK | DKK | DKK | DKK | EUR | ||||
12 months | 12 months | 12 months | 9 months | 12 months | 12 months | ||||
In millions, except per share data | 2019/20 | 2020/21 | 2021/22 | 2022 | 2023 | 20231) | |||
Key figures | |||||||||
Income statement | |||||||||
Revenue | 195,6 | 136,9 | 147,0 | 103,4 | 143,3 | 19,2 | |||
Gross profit | 35,3 | 28,4 | 39,1 | 27,5 | 31,9 | 4,1 | |||
Operating profit/(loss) | (17,8) | 4,7 | 17,8 | 17,0 | 8,6 | 1,2 | |||
Net financials | (3,1) | (3,9) | (3,1) | (1,8) | (4,9) | (0,7) | |||
Profit/(loss) before tax | (20,8) | 0,9 | 14,6 | 15,3 | 3,5 | 0,5 | |||
Profit/(loss) for the year | (18,4) | 0,9 | 12,1 | 12,0 | 2,9 | 0,4 | |||
Profit/(loss) before financial income and expenses, tax, | ||||||
depreciation, amortization, and impairment of assets | ||||||
(EBITDA) | 1,7 | 19,6 | 23,9 | 18,2 | 10,8 | 1,5 |
Balance sheet | ||||||
Assets | ||||||
Completed development projects | 5,6 | 0,2 | - | - | - | - |
Other non-current assets | 166,3 | 154,7 | 152,7 | 157,7 | 154,1 | 20,7 |
Current assets | 75,3 | 57,4 | 67,5 | 82,8 | 64,2 | 8,6 |
Total assets | 247,2 | 212,3 | 220,2 | 240,5 | 218,3 | 29,3 |
Liabilities | ||||||
Share capital | 73,6 | 73,9 | 86,3 | 98,4 | 101,2 | 13,6 |
Non-current liabilities | 88,9 | 76,5 | 70,1 | 65,9 | 72,1 | 9,6 |
Current liabilities | 84,7 | 61,9 | 63,8 | 76,2 | 45,0 | 6,1 |
Total Equity and liabilities | 247,2 | 212,3 | 220,2 | 240,5 | 218,3 | 29,3 |
Cash flows | ||||||
Cash flows from operating activities | (2,1) | 15,6 | 23,2 | (9,3) | 13,9 | 1,8 |
Cash flows from investing activities2) | (7,4) | 0,2 | (4,1) | (1,4) | (0,6) | (0,1) |
Free cash flow | (9,5) | 15,8 | 19,1 | (10,7) | 13,3 | (1,7) |
Cash flows from financing activities | 9,3 | (16,4) | (18,9) | 10,6 | (13,0) | (1,7) |
Change in cash and cash equivalents for the year | (0,2) | (0,6) | 0,2 | (0,1) | 0,3 | 0,0 |
2) including investments in property, plant and | ||||||
equipment and investment properties | (7,4) | (0,3) | (4,1) | (1,4) | (0,8) | (0,1) |
Financial ratios in % | ||||||
Operating margin | (9,1) | 3,5 | 11,7 | 16,5 | 6,0 | 6,0 |
EBITDA margin | 0,9 | 14,3 | 16,3 | 17,6 | 7,5 | 7,5 |
Return on assets | (7,3) | 2,1 | 8,0 | 7,4 | 3,8 | 3,8 |
Return on equity (ROE) | (22,9) | 1,2 | 15,1 | 13,0 | 2,9 | 2,9 |
Solvency ratio | 29,8 | 34,8 | 39,2 | 40,9 | 46,4 | 46,4 |
Other information | ||||||
Credit institutions net interest-bearing debt | 97,5 | 86,5 | 71,1 | 83,9 | 73,4 | 9,8 |
Interest coverage | (12,4) | 1,7 | 6,9 | 9,3 | 2,0 | 2,0 |
Earnings per share (EPS) | (10,1) | 0,5 | 6,7 | 6,6 | 1,6 | 0,2 |
Diluted earnings per share (EPS-D) | (10,1) | 0,5 | 6,7 | 6,6 | 1,6 | 0,2 |
Cash flow per share (CFPS) | (1,1) | 8,6 | 12,7 | (5,1) | 7,7 | 1,0 |
Book value per share (BVPS) | 40,4 | 40,6 | 47,4 | 54,1 | 55,6 | 7,5 |
Share price (KI) | 55 | 65 | 78 | 75 | 72 | 9,6 |
Average number of shares outstanding (in thousands) | 1.821 | 1.821 | 1.821 | 1.821 | 1.821 | 1.821 |
Dividend per share | 0,0 | 0,0 | 0,0 | 0,0 | 0,0 | 0,0 |
Average number of employees | 158 | 119 | 101 | 108 | 113 | 113 |
The accounting period in 2022 is from April 1st to December 31st hence covering a 9-month period only. For definitions of financial ratios, see page 64.
- The DKK/EUR exchange rate applied is 745.
ANNUAL REPORT 2023 | Page | 5 |
MANAGEMENT'S REVIEW
BUSINESS AND FINANCIAL REVIEW
Strategy/Turnaround
Following the decline in gross profit margins over the previous year, a short-term plan (referred to as the Plan 2023/24) was developed during 2023 covering a 1½- year period. This plan - among others - included further operational consolidation, additional focus on purchase of parts and materials, additional focus on new markets, an updated go-to-market approach, new product launches, and organizational adjustments.
Plan 2023/24 initiated by mid-2023 will improve the annual EBITDA by approximately DKK 7,0 million and improve the annual profit before tax by approximately DKK 5,0 million.
Main events in 2023:
- Higher prices due to inflation on i.e., mechanical parts, electronic components, electricity, and gas. The subsequent sales price increases were not implemented fast enough to fully cover the cost within 2023.
- The inflation in Denmark came to 3,3% Y-O-Y in 2023, whereas it remained relatively high in Slovakia at 10,8% Y-O-Y in 2023.
- A significant increase in cost of capital as the short- term interest rates soared from approximately 3% to approximately 7% within 1-1½ year.
- The supply of especially electronic components improved during Q3, 2023.
- We handed back the rented facility in Nyborg to the owner earlier against a one-off payment. This impacts 2023 negatively by DKK 0,5 million but will improve our financial results in 2024 and 2025.
- Our strong focus on improving the balance sheet/working capital was successful. Inventories were reduced from DKK 56,8 million to DKK 43,0 million - a reduction of 24%. This included an inventory write down of DKK 4,2 million.
- Our bank loans were restructured to allow for a higher element of fixed-interest loans. And our solvency ratio improved.
- Our investment property, Selandia Park, saw important changes during 2023. This included a new tenant for a substantial part of the building complex as well as extended rental agreements. As a result, the outlook for 2024 onwards has improved.
Offset market
Glunz & Jensen's sales to the Offset market increased by 45,2% in 2023 compared to 2022. The market has seen a slow decline over a long period due to changes in consumer behavior driving less need for commercial print as well as a shift from traditional to digital print production. Our sales of offset products in 2023 represents organic growth of 5% (based on a 12-month period), which exceeded our expectations.
Flexo market
While competition in the Flexo market remained fierce in 2023 we saw sales increasing by 8,3% compared to calendar year 2022.
Glunz & Jensen estimates that the global market volume continues to grow at 1-3% annually and remains confident that we maintain momentum in this segment due to our professional network of partners as well as significant value offering.
Focused development activity
Glunz & Jensen's strategic focus in recent years has been to meet customer demands through the development of new and competitive products, both in Offset and in Flexo. We develop machines both for our own brand and act as a trusted development partner for some of the world's largest plate manufacturers.
Selandia Park A/S
Selandia Park A/S' business objective is to invest in and operate a property portfolio. Rental income in Selandia Park A/S increased to DKK 11,2 million (2022: DKK 9,7 million), excluding rental income from Glunz & Jensen A/S. Approximately 8% of the property complex was idle by the end of 2023.
One tenant vacated Selandia Park by July 2023 after the expiration of the 10-year rental contract agreement. The tenant had occupied a rental area equal to approximately 25,4% of the total square meters at Selandia Park. Approximately 13,9% of the vacant area was leased to a new tenant by August 2023 and the remaining 11,5% was leased to another new tenant by November 2023. The portfolio of rental contracts is currently set to expire from 2026 at the earliest and to 2033 at the latest. Selandia Park A/S contributed DKK 6,0 million to profit before tax. The fair value of the investment properties amounts to DKK 146,5 million by December 31st, 2023 (2022: DKK 146,5 million). The value was positively impacted compared to 2022 due to increased rental income but also negatively impacted by higher market expectations on return on investments compared to 2022 as the cost of financing has increased during the past year.
Page | 6 | ANNUAL REPORT 2023 |
MANAGEMENT'S REVIEW
OPTIMIZATION OF THE VALUE CHAIN
Glunz & Jensen's strategy is based on the following key themes:
1. Leading the market for Offset prepress equipment
Offset is one of Glunz & Jensen's cornerstone business areas with iCtP solutions and CtP processors as main products. These develop and prepare aluminum Offset plates for commercial printing applications such as newspapers, inserts, magazines, books, information, promotional material, and a variety of other printed medias.
Our aim is to further strengthen our position as market leader on the global Offset market by consolidating our variety offering and through continuing to invest in R&D and deliver cutting-edge quality products with low energy consumption and reduced environmental impact at competitive prices. Further we will increase our footprint in regions which are still showing notable progress for Offset products, mainly APAC and North America.
2. Developing a leading position in the Flexo market through customer satisfaction and the development and launch of cost-efficient products
Glunz & Jensen is one of the largest providers of Flexo equipment globally. In addition, we act as a valued development and manufacturing partner for some of the largest plate manufacturers. The Flexo market - which mainly serves the labels and packaging industry - develops at an estimated annual growth rate of 1-3%, driven by underlying growth in packaging, changing demographics, and shares gained from other printing technologies. We expect to continue to gain market share in this segment going forward.
ANNUAL REPORT 2023 | Page | 7 |
3. Growing the after sale-market
Glunz & Jensen's after sale-market business includes sales of spare parts, consumables for iCtP products, installation, repair, preventive maintenance of hardware and software. In addition to enhanced profitability, these activities strengthen our relationship with customers and provide valuable feedback and dialogue with the end- users.
Early in 2024 we will launch a new training academy at our plant in Presov, Slovakia with the objective here to continue to build technology understanding and skills with our partners and their customers.
We strive to increase the after sale-market business by streamlining our supply chain to serve customers faster and continue to offer high-quality OEM parts to keep our equipment running smoothly.
4. Improving profitability
During the last years, a significant number of steps have been taken to further improve the profitability of Glunz & Jensen. These include reduction of product range (overlapping products), transfer of functions from Glunz
- Jensen A/S, Denmark to Glunz & Jensen s.r.o., Slovakia and discontinuation of loss-making parts of our business and product portfolio plus a stringent focus on cost throughout the value chain.
These significant steps combined with great effort by our staff have resulted in a significantly improved profitability, despite the shortages of parts and electronic components and higher-than-normal inflation.
MANAGEMENT'S REVIEW
OUTLOOK
For the fiscal year 2024, the Group revenue is expected to come in at approximately DKK 148 million, while operating profit (EBITDA) is expected at approximately DKK 18 million. The profit before tax is expected at approximately DKK 10 million.
Management underlines that the outlook for the fiscal year 2024 is associated with some uncertainty as the Company may be impacted by wars, inflation, challenges on the supply side of parts and other events.
It is the Group's intention to use the free cash flow to the greatest possible benefit of its shareholders. This includes investment in business development and technology as well as reduction of debt.
BUSINESS MODEL
Glunz & Jensen is a supplier of innovative, high-quality plate making equipment and solutions for the global prepress industry. In addition to developing and producing processing equipment for Offset and Flexo printing technologies, we also offer premier customer support as well as a full range of spare parts, wear parts and consumable products. Our diverse product portfolio includes inkjet imaging systems, exposure units, wash out units (processors), dryers, light finishers, full- automatic platemaking (inline) systems, mounting tables, plate stackers & turners.
Our R&D, supply chain, production, testing, and training facilities are in Presov, Slovakia, and our products are based on application know-how and own developed technology. In addition, we have an R&D and test facility in Odense, Denmark, working on unique applications and technology for our single largest customer.
Glunz & Jensen has been operating in prepress for more than 50 years. We have long-standing relations with major industry leading companies such as Asahi, DuPont, ECO3, Fuji Film, Heidelberg, KBA, Kodak, MacDermid, Miraclon, TechNova and more. We market our products and solutions globally through a well-established, comprehensive, and worldwide network of distributors and dealers. We have approx. 114 employees in our facilities in Denmark, Slovakia and the USA.
We are on the path to be the most innovative high-end equipment and services provider, delivering outstanding value for money in our product areas, and thereby growing our market share with our global partners. We are also set to strengthen our earnings through improved trade profitability and optimized manufacturing including within procurement and supply chain.
Page | 8 | ANNUAL REPORT 2023 |
MANAGEMENT'S REVIEW
FINANCIAL STATEMENTS
The Group
Income statement
Important note: All references to 2022 are based on the period April 1st - December 31st, 2022, equal to 9 months. All other fiscal years consist of the periods equal to 12 months.
Group revenue
The Group's revenue totaled DKK 143,3 million in 2023 (2022: DKK 103,4 million).
Figure 1: Revenue (million DKK), fiscal years, note 2022 at only 9 months.
Figure 2: Revenue (million DKK) by product, fiscal years, note 2022 at only 9 months.
Ongoing products and solutions development
Glunz & Jensen is close to having completed a major project in Thermal Flexo, for our single most important customer. Final testing in labs as well as at customer sites nears their completion before commercial release of mentioned product, targeted in Q2, 2024.
Ongoing optimization updating to today's technology platform of our existing product mix including new user controls for Flex-Dry and Flex-Finish will see light of day in Q1. Similarly, for our main offset range of processors we have replaced legacy user control units and software with a friendlier and current technology Android based tablet platform, that will allow for remote operation too. All steps to assure the ongoing respect and appreciation of premier end consumer value in our services offering.
Selandia Park
Selandia Park A/S' business objective is to invest in and operate a property portfolio. Rental income in Selandia Park A/S increased to DKK 11,2 million (2022: DKK 9,7 million), excluding rental income from Glunz & Jensen A/S. Approximately 8% of the property complex was idle by the end of 2023.
One tenant vacated Selandia Park by July 2023 after the expiration of the 10-year rental contract agreement. The tenant had occupied a rental area equal to approximately 25,4% of the total square meters at Selandia Park. Approximately 13,9% percentage points of the vacant area was leased to a new tenant by August 2023 and the remaining 11,5% percentage points was leased to another new tenant by November 2023. The portfolio of rental contracts is currently set to expire from 2026 at the earliest and to 2033 at the latest. Selandia Park A/S contributed DKK 6,0 million to profit before tax. The fair value of the investment properties amounts to DKK 146,5 million by December 31st, 2023 (2022: DKK 146,5 million). The value was positively impacted compared to 2022 due to increased rental income but also negatively impacted by higher market expectations on return on investments compared to 2022 as the cost of financing has increased during the past year.
Gross profit
Gross profit for 2023 totaled DKK 31,9 million (2022: DKK 27,5 million), corresponding to a decrease in gross profit margin to 22,2% (2022: 26,6%).
Figure 3: Gross profit and gross profit margin for the fiscal years.
ANNUAL REPORT 2023 | Page | 9 |
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Glunz & Jensen Holding A/S published this content on 18 March 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 19 March 2024 13:04:04 UTC.
