Koenig & Bauer AG
(notes according to the German Commercial Code)
The annual financial statements of Koenig & Bauer AG were prepared in accordance with the provisions of the German Commercial Code (HGB).
As a holding company Koenig & Bauer AG does not conduct any operating business of its own but performs central and strategic functions for the Group. Central functions performed for the Koenig & Bauer Group include compliance/auditing, controlling, corporate development, innovation promotion, investor relations, corporate responsibility, accounting, purchasing, IT, corporate accounting, patent and licensing, human resources, legal and insurance, tax and central marketing/corporate communications. In addition, Koenig & Bauer AG provides IT hardware and operates the computer centre for Group tasks and grants licences and brand rights to the subsidiaries. In connection with the restructuring of the Koenig & Bauer Group as a holding company in the course of 2025, Koenig & Bauer AG is streamlining its tasks and assigning more operational responsibilities to the two segments. In addition to pursuing the Group’s strategic responsibilities, the holding company will continue to provide shared services for all Group subsidiaries, including IT, HR, IR, communications, central purchasing and financial services. The number of employees on 31 December 2024, excluding apprentices, was 477 (previous year: 479).
In addition to income from the services recharged to the Group companies and the fees for the use of licences and brand rights, Koenig & Bauer AG’s business performance depends on the dividend income and profit transfers received from the subsidiaries and, hence, their business performance. The direct and indirect investments held by Koenig & Bauer AG are shown in a list in the notes to the consolidated financial statements.
Report on risks, opportunities and forecasts
The developments described in the chapters of the economic report mainly affect the business activities of Koenig & Bauer AG and its subsidiaries. Koenig & Bauer AG’s business performance is significantly influenced by its subsidiaries and is therefore directly or indirectly subject to the same risks and opportunities as the Koenig & Bauer Group. The risks to which Koenig & Bauer AG is exposed include impairments of investments in subsidiaries and receivables from affiliated companies. The impairment tests for the investments in subsidiaries are generally based on a discounted cash flow model, which is influenced by the performance and earnings of the subsidiaries and their own investments. Therefore, adverse effects on subsidiaries or indirect investments may necessitate the recognition of impairments for investments and loss allowances for receivables in Koenig & Bauer AG’s annual financial statements. Impairments and loss allowances would reduce the net profit available for distribution to the shareholders. As the investments in subsidiaries and receivables from affiliated companies constitute a substantial proportion of the total assets, this is a signifiant risk. Fluctuations in net investment income and loss allowances for receivables from affiliated companies would have a correspondingly large effect on Koenig & Bauer AG’s net profit. Due to these interrelationships between Koenig & Bauer AG and its subsidiaries, the outlook for the Koenig & Bauer Group also reflects the expectations for Koenig & Bauer AG. Therefore, the above statements for the Koenig & Bauer Group also apply to Koenig & Bauer AG. No separate significant performance indicators have been defined for Koenig & Bauer AG.
Earnings
At €132.5m, revenue was up on the previous year’s figure of €112.0m and chiefly comprised income from transfer pricing for shared services provided by Koenig & Bauer AG for the operating Group companies and fees for the utilisation of licences and brand rights as well as land and buildings. Gross profit rose by €12.1m to €42.1m. Compared with the previous year, the cost of sales increased by €8.3m to €-90.4m (previous year: €-82.1m). The gross margin widened to 31.8%, up from 26.7% in the previous year, mainly due to higher revenue from shared services. General administrative expenses increased by €1.1m to €44.2m (previous year: €43.1m) and mainly resulted from expenses for personnel and other expenses as well as expenses for adjustments to property, plant and equipment and personnel costs in connection with “Spotlight”. The other operating income of €6.8m (previous year: €6.0m) mainly includes the reversal of other provisions. Other operating expenses of €60.8m (previous year: €1.9m) primarily relate to expenses from individual loss allowances in the Group. On balance, this resulted in operating earnings of €-56.0m, compared with €-9.0m in the previous year.
Net investment income consists of dividend distributions (2024: €38.5m; 2023: €16.9m), income from profit transfer agreements (2024: €5.6m; 2023: €38.2m), impairments of financial assets (2024: €-6.4m; 2023: €-17.9m), fair-value remeasure gains on financial assets (2024: €7.8m; 2023: €1.3m) and loss absorption expenses (2024: €-31.6m; 2023: €-7.5m) from subsidiaries. It fell by €17.2m to €13.9m as of 31 December 2024 (previous year: €31.1m)
The financial result amounted to €-5.5m (previous year: €14.2m), mainly due to the higher interest expense as a result of increased borrowings. Net interest expense came to €-19.4m as of 31 December 2024 (previous year: €-16.9m). Income taxes amounted to €-0.2m (previous year: €0.6m). On balance, this resulted in a net loss for the year of €61.7m (previous year: net profit for the year of €5.8m). Including the profit carried forward of €2.9m and the retained amount of €2.9m, the accrued deficit stands at €-61.7m.
The Executive Board and the Supervisory Board acting in accordance with Section 58 of the German Stock Corporation Act have passed a resolution to retain an amount of €2.9m. The Executive Board acting with the Supervisory Board’s approval proposes that the unappropriated surplus of €2.9m be retained.
Assets and finances
As of 31 December 2024, Koenig & Bauer AG’s total assets stood at €753.9m, down from €761.7m in the previous year. Non-current assets rose by a total of €9.9m to €542.0m (31 December 2023: €532.1m). This increase is mainly due to additions to the shares in affiliated companies. As of the reporting date, financial assets were valued at €416.7m, compared with €407.4m in the previous year. The increase in intangible assets from €56.1m to €61.1m, which primarily included prepayments towards intangible assets, was accompanied by a decline in property, plant and equipment from €68.6m to €64.2m as a result of systematic depreciation. The opposite effect arose from the acquisition of land in connection with a merger. The reduction in current assets from €227.0m to €209.0m was due to the decrease in receivables from affiliated companies from €159.1m to €123.1m and is mainly characterised by individual loss allowances. They include receivables under loans to affiliated companies of €29.2m (31 December 2023: €47.6m), receivables from offsetting cash flows of €86.0m (31 December 2023: €96.5m) as well as trade receivables of €8.0m (31 December 2023: €14.9m). In addition, receivables from associates rose from €20.8m to €28.9m. Cash in hand and at banks increased from €45.1m to €52.9m.
As a result of the net loss at the end of 2024, equity fell to €253.2m (31 December 2023: €314.9m). The equity ratio stood at 33.6% as of the reporting date (31 December 2023: 41.3%). Provisions fell slightly from €107.6m in the previous year to €103.1m. Provisions for pensions and similar obligations decreased to €73.5m (31 December 2023: €78.2m) and tax provisions to €0.0m (31 December 2023: €0.1m). Provisions for pensions decreased mainly as a result of the higher discount rate. In contrast, other provisions rose slightly to €29.6m (December 31, 2023: €29.3m). All told, liabilities climbed from €338.5m to €397.1m as of 31 December 2024. Liabilities to banks increased from €235.4m to €254.9m mainly due to drawing on the syndicated loan. Prepayments received on orders also increased year-on-year, while trade payables and other liabilities were slightly lower. Liabilities to affiliated companies climbed from €94.9m to €132.1m.
Cash flow from operating activities amounted to €20.8m (previous year: €-47.1m) and is mainly attributable to active net working capital management, in which receivables were reduced and liabilities accrued. The cash flow of €-31.4m (previous year: €-17.9m) from investing activities resulted from the increase in investments or the acquisition of companies and additions to intangible assets. Cash flow from financing activities of €18.6m (previous year: €46.2m) also reflects changes in the syndicated loan.