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Belgium : Agfa-Gevaert publishes its second quarter 2014 results

August 30, 2014

Our top line reflects the adverse currency effects and the continuously depressed economic conditions in certain parts of the world, including most emerging markets. In these tough circumstances, we continued to progress on our main goals. Continuing to work towards our target of delivering a double digit recurring EBITDA percentage, we further improved the gross profit margin. Furthermore, efficiency programs, targeted actions to limit the restructuring costs and positive raw material effects allowed us to post a strong net profit. Cash flow generation also continued to be strong, leading to a further decrease in net financial debt. These elements will remain our main focus points in the second half of the year. Meanwhile, we will also focus on controlling the top line evolution, said Christian Reinaudo, President and CEO of the Agfa-Gevaert Group.

The Agfa-Gevaert Group s revenue declined by 11.1 percent compared to the second quarter of 2013. On a currency comparable basis, the decline amounted to 8.3 percent. The weakness in most of the emerging markets and the unstable political situation in certain regions impacted the Group s top line. Agfa HealthCare s Imaging IT Solutions division suffered from the uncertain investment climate in the US healthcare sector. The business group s Direct Radiography business posted very strong sales growth. The hardcopy business and the Healthcare Information Solutions division also performed well.

The Group made good progress in improving the gross profit margin to 31.8 percent of revenue, versus 28.8 percent in the second quarter of 2013 and 29.3 percent in the first quarter of 2014. The Group s efficiency programs and positive raw material effects were the main drivers behind this evolution.

As a percentage of revenue, Selling and General Administration expenses amounted to 19.2 percent.

R&D expenses amounted to 37 million Euro, versus 36 million Euro in last year s second quarter.

Recurring EBITDA (the sum of Graphics, HealthCare, Specialty Products and the unallocated portion) and recurring EBIT improved to 9.7 percent and 7.1 percent of revenue respectively.

Due to targeted actions, restructuring and non-recurring items were limited to an expense of 2 million Euro. In the second quarter of 2013, these items resulted in an income of 31 million Euro, as the Group booked the effects of the closure of the post-retirement medical plan in the USA.

The net finance costs amounted to 13 million Euro, versus 21 million Euro in the second quarter of 2013. Tax expenses amounted to 3 million Euro, versus 23 million Euro in the second quarter of 2013, when a one-off deferred (non cash) tax expense related to the closure of the post-retirement medical plan in the USA was booked.

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Source: TendersInfo (India)

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