CEWE reports modest earnings improvement

CEWE Stiftung & Co. KGaA reported a 3.3% sales decline to 413.3 million euros, compared to 427.2 million euros, for the first three quarters of 2020. The EBIT improved by 1.4 million euros to -0.6 million euros, compared to -2.0 million euros.

Dr. Christian Friege

“Just like the economy in general, we are naturally also feeling the impact of the coronavirus pandemic,” says Dr. Christian Friege, CEO, CEWE. “More than anything else, this applies for our retail and commercial online printing business segments, both of which have been affected by the crisis. On the other hand, our core business segment of photofinishing has shown itself to be robust, continuing to grow in the first nine months of the year. This gives us reason to be confident about the upcoming Christmas season, since it is very significantly marked as an occasion to give individual, personal photo products as gifts.”

CEWE reports, despite the COVID-19 pandemic, the core photofinishing business grew 5.9% to 335.7 million euros. Despite the fact there were fewer overall photo orders due to changes in consumer travel habits and retail shutdown, the company saw an increase in at-home orders. Salers per photo increased by altogether more than 10%, to 23.18 eurocents, in the first nine months of the year. The EBIT for this business segment rose sharply by 6.0 million euros to 8.6 million euros (Q1-3 2019: 2.6 million euros), in part due to cost-reduction programs begun as early as March.

On the other hand, the comany’s commercial business segment was hit hard, with a 35% sales decline to $48.8 million euros. “Intensive cost management” enabled the EBIT decline of 2.7 million euros to -5.0 million euros to be contained. The integration of LASERLINE production in Berlin into the SAXOPRINT operation in Dresden, has been successfully implemented.

“We are convinced that our brand portfolio, which we streamlined as early as at mid-year, and our sustainably optimised cost structure will see us emerging stronger from the crisis,” explains Friege.

CEWE’s retail segment continues to struggle; this is an area the company has been reducing in favor of higher-margin categories. Sales in the retail business segment in the first three quarters thus declined by 23.0% to 24.0 million euros (Q1-3 2019: 31.2 million euros). Retailing also traditionally achieves its annual net income in the fourth quarter of a calendar year.

Christmas season is decisive for annual net income

“In this exceptional year it is not possible to make any reliable prediction concerning fourth-quarter earnings,” says Friege. “We are confident that our first-class photo products have long established themselves as individual, personal Christmas gifts and that we are in a position to provide an extremely wide range of products.”

CEWE launched a Christmas campaign – “My very personal gift” – in November, where CEWE customers go on-camera to share their experience with the CEWE PHOTOBOOK. Example below:


An overview of 2020 Q3 and Q1-3 results

CEWE business segments Unit Q3 2019 Q3 2020 Q1-3 2019 Q1-3 2020
(1) Photofinishing
Photos m. photos 549.6 474.6 1,508.9 1,448.1
CEWE PHOTOBOOK in th. units 1,407 1,188 3,973 3,921
Turnover EUR m. 116.2 110.4 316.9 335.7
EBIT EUR m. 0.8 0.2 2.6 8.6
Purchase price allocation effects EUR m. -1.1 -1.1 -2.5 -3.3
EBIT before special effects EUR m. 1.9 1.3 5.1 11.9
(2) Retailing
Turnover EUR m. 10.2 9.0 31.2 24.0
EBIT EUR m. -0.1 -0.1 -0.8 -3.7
Restructuring provisions EUR m. -1.7
Allowances for inventories of stocks EUR m. -1.5
EBIT before special effects EUR m. -0.1 -0.1 -0.8 -0.5
(3) Commercial Online Printing
Turnover EUR m. 24.8 15.4 75.1 48.8
EBIT EUR m. -0.8 -1.6 -2.3 -5.0
Purchase price allocation effects EUR m. -0.1 -0.1 -0.4 -0.2
Conversion to performance-oriented
allowances for depreciation
EUR m. 0.6
EBIT before special effects EUR m. -0.7 -1.5 -1.8 -5.3
(3) Other
Turnover EUR m. 1.4 1.6 4.0 4.7
EBIT EUR m. -0.3 -0.2 -1.5 -0.5
CEWE Group Unit Q3 2019 Q3 2020 Q1-3 2019 Q1-3 2020
Turnover EUR m. 152.7 136.3 427.2 413.3
EBIT EUR m. -0.5 -1.7 -2.0 -0.6
Total special effects EUR m. -1.2 -1.2 -2.9 -6.1
EBIT before special effects EUR m. 0.8 -0.5 0.9 5.5
EBT EUR m. -1.0 -2.0 -2.8 -1.5

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

Notes to the “Earnings by Business Segment” chart

(1) Photofinishing: Production and sale of photo products such as the CEWE PHOTO BOOK, calendars, greeting cards, 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 of SAXOPRINT, viaprinto and LASERLINE