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CEWE facing the corona crisis after a good year in 2019

DGAP-News: CEWE Stiftung & Co. KGaA / Key word(s): Annual Results
26.03.2020 / 07:00
The issuer is solely responsible for the content of this announcement.

CEWE facing the corona crisis after a good year in 2019

  • Annual Report press conference: 2019 turnover increases by 10.1% to 714.9 million euros; EBIT of 57.8 million euros at the upper end of the target corridor
  • New sales record: more than 6.6 million CEWE PHOTOBOOKS sold in 2019
  • Eleventh consecutive dividend increase proposed: 2.00 euros per share
  • CEWE equipped for potential effects of the corona crisis with a strong balance sheet
  • Measures put in place to guarantee capacity to take in orders and deliver

Oldenburg, 26 March 2020. In light of the current corona pandemic, CEWE Stiftung & Co. KGaA (SDAX, ISIN: DE 0005403901) has taken extensive measures to provide its staff with maximum protection and to continue to ensure that its products are available for order. In doing this CEWE is excellently positioned as an omnichannel supplier. Even if retail stores are closed, consumers can all order any CEWE photo product online; orders will also be delivered direct to their home by mail. CEWE presented its corporate figures for 2019 during the annual report and analysts' press conference held today. In the financial year of 2019, CEWE increased its turnover by 10.1% to 714.9 million euros (2018: 649.3 million euros), thus exceeding its own target (675 to 710 million euros). The biggest growth driver was the main business segment of photofinishing, which saw turnover growing by 13.8% to a current 568 million euros. At 57.8 million euros (2018: 55.7 million euros), operative earnings (EBIT) reached the upper end of the target corridor - in spite of provisions previously announced for LASERLINE improvement measures in commercial online printing already having been incorporated in an amount of 5 million euros. Given this stable positive development trend, the Board of Management and the Supervisory Board is now in a position to propose to the Annual General Meeting an eleventh consecutive increase in dividends: from 1.95 in the previous year to 2.00 euros. With a sound balance sheet and a capital ratio of 53.6% (prior to IFRS 16 lease accounting), CEWE considers itself to be equipped for the potential impact of the global corona crisis on the Group's own business development. "Customer satisfaction and customer loyalty are a sound foundation for CEWE, a foundation on which we develop the value of our company. And this is why we intend to do everything to continue to delight people for the CEWE product world," says Dr. Christian Friege, CEWE Stiftung & CO. KGaA CEO, on the occasion of the CEWE annual report and analysts' press conference held today.

Core business of photofinishing remains the main growth driver
The development of the company's most important business segment of photofinishing was extremely positive: an increase in turnover of 13.8% to a current 568 million euros (2018: 499 million euros) saw EBIT improving by 9.1 million euros to 66.9 million euros (2018: 57.8 million euros). The core product, the CEWE PHOTOBOOK, grew particularly well, increasing by an unexpected 7.2% to 6.62 million photobooks. CEWE sold altogether more than 2.4 billion photos - an increase of 7.9%, hence exceeding the target corridor of 2.22 to 2.26 billion photos. "Our customers are equally impressed by the quality of our products, the diversity of our range and the services we render," says Dr. Christian Friege. The overall positive trend towards high-quality photo products is reflected in our turnover per photo: at 23.65 eurocents, CEWE achieved another increase here: a plus of 5.5% (2018): 22.42 eurocents). In 2019 as well, the fourth quarter with its Christmas season manifested itself as CEWE's main success factor. The company showed another clear increase in Q4, with turnover exceeding that of the same quarter of the previous year by 15.0% to amount to 251.1 million euros (2018: 218.3 million euros). Dr. Christian Friege says: "We are delighted with this outstanding development in our most important business unit. CEWE is an integral part of wish lists and gift tables, bringing joy to people with personal, individual photo gifts."

Commercial online printing raised turnover, but was burdened by high price pressure
Turnover in the business unit of commercial online printing increased slightly in 2019, by 1.6% to 103.2 million euros (2018: 101.6 million euros). This result was, however, negatively affected by the weak turnover and earnings generated by LASERLINE due to price pressure. In view of this development, at the end of 2019 CEWE had already communicated that it would merge LASERLINE production and SAXOPRINT production in Dresden in order to enhance product efficiency and profitability in the business segment as a whole. Provisions in the amount of 5 million euros were correspondingly already made for these restructuring measures in the 2019 annual accounts. This overall situation at LASERLINE in the previous financial year resulted in the EBIT for commercial online printing negatively impacting consolidated earnings in the amount of -7.7 million euros (2018: -1.6 million euros).

Retailing continues with successfully focusing on photofinishing business
Turnover generated with photo hardware in the retail business unit was further reduced as planned and managed with a focus on earnings. In 2019, turnover amounted to 43.7 million euros (2018: 48.7 million euros). In spite of reduced sales, the business unit, with EBIT at 35 thousand euros, made a positive contribution to consolidated earnings in around the same amount as in the previous year (2018: 55 thousand euros). CEWE will remain consistent in its approach towards giving up low-margin business with hardware. The focus will still definitely be on the area of photofinishing, which also covers the photofinishing orders received in retailing.

Adjusted ROCE at 19.6%, after-tax earnings of 36.8 million euros
Restructuring provisions for LASERLINE in the 2019 financial year had an impact on the return on capital employed (15.0%) as well as on after-tax earnings (31.8 million euros). Without this one-off effect and without the increase in capital employed as laid down in IFRS 16 (lease accounting), ROCE amounts to a strong 19.6%, and after-tax earnings, at 36.8 million euros, are in the target corridor of 35 to 39 million euros for 2019. The same applies for earnings per share: without the extraordinary expenses for LASERLINE, the figure of 5.11 euros lies in the anticipated range (target corridor for 2019: 4.74 to 5.40 euros; earnings per share including LASERLINE extraordinary expenses: 4.41 euros).

Positive financial situation makes consecutive eleventh dividend increase possible
The capital ratio was an extremely sound 47.6% as at 31 December 2019 (31 December 2018: 53.8%). In a comparison with the previous year, on the exclusion of the IFRS 16 balance-sheet extension (lease accounting), this figure amounts to as much as 53.6%. On the basis of this stable financial situation, the Board of Management and the Supervisory Board have decided propose the payment of a dividend of 2.00 euros to shareholders at this year's Annual General Meeting (previous year's dividend: 1.95 euros). Provided the shareholders approve the proposal, this would be the eleventh dividend increase in succession. On the basis of the current share price of 88.60 euros (XETRA closing price on 25 March 2020), shareholders are realising a dividend yield of 2.3% - in addition to a rise in the share price of 70% in 2019, from 62.10 euros (31 December 2018).

CEWE puts measures in place to cope with the corona crisis
Government measures and restrictions to stop the spread of the coronavirus are currently dominating all of the people's everyday lives. In its responsibility to counter the spread of the virus as far as possible, CEWE has activated relevant contingency plans to prevent employees from being infected with the virus and operations and units from being shut down. Where possible, CEWE employees are currently working from home. Multi-shift operation in production has been organised and separated so as to make it possible to limit the risk of a loss of production. Roles and offices were correspondingly also separated and moved to other locations in the administrative area. CEWE has 13 production operations, putting it in a position to immediately redirect orders from customers electronically to other production operations throughout Europe, where they can be produced and despatched. Customers can continue to order their CEWE photo products online even in the event of possible restrictions for retail customers supplied by CEWE. Delivery will be made by mail direct to customers' homes.

Impact of corona on CEWE objectives for 2020 not yet quantifiable
It is becoming apparent that the economic consequences for Europe will be considerable. The current corona situation is likely to have a negative impact on CEWE's business development as well, in spite of the fact that many photofinishing products can typically be ordered from home and delivered by mail. This said, the specific impact of the corona pandemic is currently not yet quantifiable. This is why the profit targets shown for 2020 are to be understood exclusive of potential effects of the corona crisis on CEWE's business development. Turnover in the CEWE Group without corona effects should thus increase to an amount in the range of 725 to 755 million euros in 2020. Group EBIT should be in a corridor of 58 to 64 million euros, EBT in the range of 56.5 to 62.5 million euros, and after tax earnings between 38 million and 43 million euros. Taking into consideration potential effects of the corona crisis, the CEWE Board of Management currently considers these targets to be unachievable.

An overview of results for 2019

CEWE business segments Unit Q4 2018 Q4 2019 2018 2019
(1) Photofinishing          
Photos in billion photos 0.81 0.89 2.23 2.40
CEWE PHOTOBOOK in million books 2.5 2.7 6.2 6.6
Turnover in EUR m. 218.3 251.1 499.0 568.0
EBIT in EUR m. 55.6 64.3 57.8 66.9
Purchase price allocation effects in EUR m. -0.6 -1.1 -2.2 -3.6
Sale of former operation in Nuremberg in EUR m. - - +1.2 -
Non-recurring costs for photokina in EUR m. - - -1.3 -
EBIT before one-off effects in EUR m. 56.2 65.4 60.2 70.5
(2) Retailing          
Turnover in EUR m. 13.6 12.4 48.7 43.7
EBIT in EUR m. 0.8 0.8 0.1 0.0
(3) Commercial Online Printing          
Turnover in EUR m. 28.6 28.2 101.6 103.2
EBIT in EUR m. 2.0 -5.5 -1.6 -7.7
Purchase price allocation effects in EUR m. -0.2 -0.1 -1.0 -0.6
LASERLINE restructuring costs in EUR m. - -5.0 - -5.0
LASERLINE integration costs in EUR m. -0.1 - -0.9 -
EBIT before one-off effects in EUR m. 2.3 -0.4 0.3 -2.2
(3) Other          
Turnover in EUR m. 1.1 1.5 4.0 5.5
EBIT in EUR m. -1.0 -0.7 -2.6 -2.3
CEWE Group Unit Q4 2018 Q4 2019 2018 2019
Turnover in EUR m. 260.5 291.7 649.3 714.9
EBIT in EUR m. 58.0 59.0 55.7 57.8
Total one-off effects in EUR m. -0.9 -6.2 -4.2 -9.2
EBIT before one-off effects in EUR m. 59.0 65.2 59.9 67.0
EBT in EUR m. 57.9 56.3 55.3 54.3
Earnings after tax in EUR m. 39.2 32.9 36.3 31.8

Rounding differences may occur. Percentage deviations have all been calculated at the exact values.

The CEWE Group turnover described here and the Group EBIT have been shown excluding Group company futalis, which is held for sale and is nevertheless still included in the "Other" business segment as a "discontinued operation" in the segment reports for the current reporting period and for the figures for the previous year pursuant to IFRS 5.

Notes to the "Earnings by Business Segment" chart

(1) Photofinishing: Production and sale of photo products such as CEWE PHOTOBOOKS, CEWE CARDS, CEWE CALENDARS, CEWE WALL ART and individual (analogue and digital) photos as well as other photo products
(2) Retailing: Trading in photo hardware, such as cameras and lenses, in Norway, Sweden, Poland, the Czech Republic and Slovakia
(3) Commercial online printing: Production and sale of commercial print products in the online printing portals, e.g., SAXOPRINT, Viaprinto and LASERLINE

Full year of 2019 and targets for 2020

CEWE Group Unit 2019 actual 2020 target
Before corona
Impact of the corona crisis
Photos 1 in billion photos 2.40 2.4 to 2.5 expected negative
CEWE PHOTOBOOK in million books 6.6 6.7 to 6.9 expected negative
Investments 2 in EUR m. 39.3 57 not clear
Turnover in EUR m. 714.9 725 to 755 expected negative
EBIT in EUR m. 57.8 58 to 64 expected negative
EBT 3 in EUR m. 54.3 56.5 to 62.5 expected negative
Earnings after tax 4 in EUR m. 31.8 38 to 43 expected negative
Earnings per share EUR/share 4.41 5.34 to 5.90 expected negative

Rounding differences may occur. Percentage deviations have all been calculated at the exact values.

1 The number of photos is the total amount of photos used to create CEWE photo products and includes all the photos used in added-value products (e.g. CEWE PHOTOBOOKS, CEWE CARDS, CEWE CALENDARS, CEWE WALL ART and other photo gifts).

2 Operative investments without potential investments in expanding the business volume (such as corporate acquisitions and/or additional customer-base acquisitions) on the exclusion of IFRS 16 new lease contracts

3 Target for 2020: Excluding subsequent valuation of equity instruments

4 Target for 2020: Based on the normalised Group tax rate for the previous year


Should you have any queries, please contact:
CEWE Stiftung & Co. KGaA, Axel Weber (Investor Relations)
Tel.: 0441 / 404 - 2288, Fax: 0441 / 404 - 421, email:

Internet: , , , , , ,,

The CEWE apps are all available in the app stores: CEWE PHOTO WORLD, CEWE POSTCARD and other photo apps, and the CEWE Investor Relations app for iPad(c) or android tablets, with annual reports and quarterly reports, presentations and sustainability reports.

Financial schedule
(insofar as already scheduled)

12.05.2020 Publication of the 2020 Q1 interim communication
12.05.2020 Press release on Q1 2020
10.06.2020 Annual General Meeting
10.06.2020 Press release on the 2020 AGM
06.08.2020 Publication of the 2020 HY1 interim report
06.08.2020 Press release on 2020 HY1
22.09.2020 2020 Berenberg & Goldman Sachs German Corporate Conference
23.09.2020 2020 Baader Investment Conference
12.11.2020 Publication of the 2020 Q3 interim communication
12.11.2020 Press release on Q3 2020
16.11.2020 German Equity Forum, Frankfurt

About CEWE
The CEWE Group is Europe's leading photo service and online printing supplier.

From its beginnings in 1912, CEWE has progressed to become the leading photo service company for all those wanting to make more of their photos. This is mainly due to the much-awarded CEWE PHOTOBOOK, with more than six million books being sold each year. Customers can purchase other personalised photo products under the brand names of CEWE, WhiteWall and Cheerz - and from many leading retailers in Europe. In terms of their personal photos, they are inspired to produce a variety of creative designs and they entrust the company with around 2.4 billion photos every year.

The CEWE Group has also set up a highly efficient production system for the online printing market, which is still new. Every year billions of high-quality printed products are delivered reliably to their purchasers through the SAXOPRINT,, LASERLINE and viaprinto sales platforms.

The CEWE Group, through the founder family of Neumüller as an an anchor shareholder, focuses on sustainable corporate management and has already received many awards for this effort: economically sustainable in the long term; cooperative and fair in dealings with customers, employees and suppliers; socially responsible and protective of the environment and resources. An example of this is the climate-neutral process used to produce all the CEWE brand-name products.

The CEWE Group has a staff of more than 4,000 employees and operates in more than 20 countries. Group sales rose to 714.9 million euros in 2019. CEWE is listed on the SDAX.

More information is available at

26.03.2020 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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Axel Weber
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Planung & Reporting

Telefon: +49 (0) 441 404-2288
Fax: +49 (0) 441 404-421

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