The following section describes the main opportunities available to the Koenig & Bauer Group. In the absence of any indication to the contrary, these affect all segments equally. However, they represent only a selection of the opportunities available. The order in which the opportunities are presented reflects the assessment of their relative significance for the Koenig & Bauer Group and provides a basis for assessing them. The assessment of opportunities is also subject to continuous change, as the company, the technologies it uses, the markets and its customers are constantly evolving. New opportunities may arise from this, existing ones may cease to exist or the significance of an opportunity may change.
Industry
In principle, the greatest opportunities for Koenig & Bauer arise in the printing industry itself. Above all else, there are opportunities for improving business performance by harnessing the development potential of special applications, such as packaging and industrial printing, the growing importance of digital printing in the packaging sector in the future and the continuing transformation processes with regard to digital products, processes and services. Looking forward, Koenig & Bauer will continue to work closely on expanding its service business. The company is trying to take advantage of additional opportunities by structuring service with a focus on digitisation. These aspects are expressly addressed by Koenig & Bauer’s “Exceeding Print” corporate strategy, which aims to make the Group even more sustainable, digital and modular. Opportunities outside the printing industry are currently seen in battery cell production. Further detailed information can be found in “Goals and Strategy” on pages 20 et seq., “Markets addressed and growth opportunities”, on pages 23 et seq. and “Partnerships and cooperation” on pages 26 et seq. Opportunities for growth may also arise from gains in market share if a competitor exits the market or abandons an area of business.
Opportunities through acquisitions and alliances
Koenig & Bauer monitors current and potential markets to identify opportunities for strategic mergers, acquisitions, investments and partnerships that it can use to complement organic growth. These activities could help Koenig & Bauer to strengthen its position in its current markets, to complement its portfolio in strategic areas or to open up new markets. It could include the partnership agreement with Volkswagen subsidiary PowerCo SE for joint development activities in sustainable battery cell production. Under current plans, the development phase is to continue up to the end of 2024. Whether the ambitious development goals will be achieved cannot be determined until after the completion of the development phase. The same thing applies to the partnership with Mitsubishi Electric for joint activities in quality control systems for electrode foils in battery cell production. Further information can be found in “Partnerships and cooperation” on pages 26 et seq.
Macroeconomic and cyclical opportunities
The containment of inflation in particular would spur the recovery of the global economy and, along with it, the printing industry. This would also be aided by an easing of the current procurement situation, particularly for electronic components such as semiconductors, and the transport situation as well as energy costs. In a number of countries there are also opportunities for social and political changes, government intervention, customs regulations and legislative amendments that may have a positive impact on the Koenig & Bauer Group’s business performance. The legislative measures and government action to accelerate the response to halt global climate change, especially in Europe, through the Green Deal, are a recent example of this.
Planning, control and monitoring
The forecasts of future business performance are based on assumptions that are subject to certain uncertainties. In addition to the risks already described, they also entail opportunities. Higher revenue than assumed for budgeting purposes and a more advantageous cost situation would have a positive impact on earnings.
Financial opportunities
A shift in exchange rates in the company’s favour would have a positive impact on its revenue and earnings. In a favourable capital market environment, an increase in the discount rate on future retirement benefits (as well as the performance of plan assets) offers scope for reducing provisions for retirement benefits and similar obligations and for an increase in equity due to actuarial gains. The implementation of the ESG rendezvous clause, which is part of the new syndicated loan, could also have a positive impact on Group earnings.
Summary of the situation with respect to opportunities
The overall situation with regard to opportunities available to the Koenig & Bauer Group is considered moderate. Even though the challenging macroeconomic conditions are factored into its expectations and business plans, Koenig & Bauer does not believe that the opportunities presented here outweigh the risks described above given the economic weakness in connection with increased inflation and mounting geopolitical tensions together with the associated risks in the supply chains. There are no changes in the opportunities available to the Koenig & Bauer Group compared with the previous year.