CEWE is planning further turnover and earnings growth in 2024

CEWE Stiftung & Co. KGaA  presented the results for 2023 and the outlook for 2024 at the Annual Press and Analysts’ Conference. The company closed the 2023 financial year with a significant increase in turnover and earnings: Group turnover, including futalis, which was sold in December 2023, increased by +6.5%, rising by €47.8 million to 788.8 million euros (2022: €741.0 million), while the CEWE Group’s operating result (EBIT) calculated in this way rose to 81.6 million euros (2022: 75.6 million euros). The Group EBIT reported following IFRS (excluding futalis) even increased by 11.0% or 8.3 million euros compared to the previous year to 83.9 million euros (2022: €75.6 million), while the reported Group turnover (excluding futalis) rose to €780.2 million (2022: €732.7 million).

The targets for 2023 have thus clearly been achieved: CEWE had planned Group turnover in the range of 720 to €780 million and EBIT of up to €82 million for 2023. The dividend for the 2023 financial year is to rise to €2.60 per share (previous year: €2.45). Subject to approval by the Annual General Meeting, this is the 15th consecutive dividend increase. CEWE is thus one of the top 3 of the 644 listed German companies that have been able to increase their dividend for so many years.

“The CEWE PHOTOBOOK, the photo calendar, the wall picture, and many other unique photo products full of personal memories have once again made millions of people throughout Europe happy in the past year. I would like to thank all CEWE colleagues for this outstanding team effort. I am very much looking forward to continuing the CEWE success story together with all employees and partners in 2024,” said Yvonne Rostock, Chairwoman of the Board of Management of CEWE Stiftung & Co. KGaA, at today’s annual press conference. CEWE is also planning further growth for the 2024 financial year: Group turnover is expected to reach a value in the range of 770 to 820 million euros in 2024, while Group EBIT is expected to be in the corridor of 77 to 87 million euros.

Photofinishing contributes to the year’s success with another strong Christmas business

The traditional seasonal peak in the Christmas business for CEWE also contributed significantly to the annual success in the past business year. Photo products in particular have a very high emotional value for many people – especially as Christmas gifts – and are increasingly in demand, largely independently of the overall economic development. Thanks to its strong brand positions and the marketing activities carried out in the past financial year, CEWE was able to successfully convert the strong activity in vacation travel, which picked up again in 2023, with many new photo images among consumers into its business growth: The total number of photos across all CEWE products rose by 4.8% to 2.39 billion in the reporting year (2022: 2.28 billion photos), and the CEWE PHOTOBOOK also saw pleasing growth with an increase of 3.4% to a sales volume of 6.1 million copies (2022: 5.8 million copies). Turnover in the core business segment of Photofinishing rose significantly by 42.7 million euros or +6.9% to 658.8 million euros in 2023 (photofinishing turnover in 2022: 616.1 million euros). The operating result (EBIT) in Photofinishing increased pleasingly to 80.0 million euros (Photofinishing EBIT 2022: 73.7 million euros). Together with its strong retail partners, who guarantee customer-oriented service with over 20,000 stores in Europe, CEWE is continuously developing the photo market through innovations.

Commercial Online-Print with profitable growth and EBIT margin of 4.5%

Commercial Online-Print closed the 2023 financial year with a significantly improved result. The business segment benefited from the cost efficiency achieved in production at SAXOPRINT and the resulting “best price guarantee” for its customers: Turnover grew by +6.6% year-on-year to EUR 92.2 million in 2023 (2022: EUR 86.5 million). Thanks to the improved cost structure, Commercial Online-Print significantly increased its EBIT by EUR +1.9 million to EUR 4.2 million (2022: EUR 2.3 million) and thus achieved a solid EBIT margin of 4.5%.

Retail continues to be well-positioned

In 2023, Hardware Retail achieved a turnover of 31.3 million euros (2022: 32.4 million euros;  -3.4%), which was actively reduced in line with the strategy. The good positioning of CEWE Retail is reflected in the earnings development: despite the reduction in turnover, the Retail business segment was able to improve its contribution to Group EBIT quite significantly by 0.3 million euros to 0.5 million euros in 2023 (2022: 0.2 million euros). In retail, CEWE continues to focus on business with Photofinishing products (reported in the Photofinishing segment) and remains deliberately avoiding lower-margin retail business in the area of photo hardware (cameras and accessories).

Strong and solid: further increase in equity ratio, free cash flow, and ROCE

The equity ratio in 2023 has risen again to 58.4% after already being at a very solid level in the previous year (31.12.2022: 57.3%), underlining that CEWE continues to be extremely stable. The operationally meaningful free cash flow, normalized primarily for cut-off effects, reached a strong 69.7 million euros (normalized free cash flow 2022: 61.4 million euros). The free cash flow reported as at the reporting date of December 31, 2023 was as high as EUR 82.8 million (reported free cash flow as at December 31, 2022: EUR 31.5 million). The return on capital employed (ROCE) was also even stronger in 2023 at 18.8% (ROCE 2022: 17.6%).

Strong results also planned for 2024

Group turnover is expected to be in the range of EUR 770 million to EUR 820 million in 2024. Group EBIT is expected to be in the range of EUR 77 million to EUR 87 million in 2024, EBT between EUR 75.5 million and EUR 85.5 million and earnings after tax between EUR 51 million and EUR 58 million. The ranges of these targets for the 2024 financial year are roughly expected values and the lower figure in each case reflects the uncertainty that currently arises from inflation-related price increases and their potential impact on CEWE’s business development. So far, inflation has not had any visible impact on customers’ ordering behavior and thus on CEWE’s turnover development.

Dividend to increase for the fifteenth time in a row

Based on the results for the 2023 financial year, the Management Board and Supervisory Board have proposed to the Annual General Meeting that the dividend should be increased to EUR 2.60 per dividend-bearing share (dividend for the 2022 financial year: EUR 2.45). Subject to shareholder approval at the Annual General Meeting to be held on June 5, 2024, the proposed dividend of EUR 2.60 per share corresponds to a dividend yield of 2.6% based on the 2023 year-end share price of EUR 101.20. This is the fifteenth consecutive dividend increase and also the highest dividend in the company’s history.

Full year 2023 and targets for 2024

An overview of results for 2023