Annual report 2005 - Xeikon

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CHAIRMAN’S STATEMENT
It is a pleasure to present Punch Graphix’s first Annual
Report and Accounts as a listed company following its
admission to AIM in May 2005.
I am delighted to report that our performance for the
year exceeded our expectations at the time of the
flotation in almost every respect.
Turnover for the year to 31 December 2005 increased by
46%, operating profit by 58%, and profit before taxation
68%. Earnings per share rose 51%. Sales of the Xeikon
products, including the industry leading Xeikon 5000
model, showed good growth, both in the European and
North and South American markets and throughout
2005, sales of both the basysPrint and OEM products
distributed by Agfa also showed promising growth.
In Asia, the uptake of digital printing technology has
been slower, with customers still preferring to use more
traditional printing methods. However, this has resulted
in stronger demand for our pre-press technology in
this region as customers are able to use cheaper
consumables and therefore enjoy the benefits of much
reduced production costs over time.
As reported at the interim stage, the Group is focused on
improving efficiency across all of its operations. Excellent
progress was made during 2005 and this remains an
ongoing programme and an important element of the
Group’s strategy for future profitable growth.
The flotation of the Group raised €28.3 million net of
expenses which is being used to develop its marketing
infrastructure, to expand its direct sales organisation into
key countries and to enhance its product development
programme. During the year, the group invested
€7.9 million in plant and machinery in order to support
its expansion programme and opened new sales offices
in China, Canada and Brazil. The new manufacturing
facility in Shenzhen, China, outlined in the interim
statement, will begin assembling its first products,
in 2006.
Dividend
As set out in the Company’s AIM Admission Document,
it is the Board’s intention to pay an aggregate annual
dividend representing 30 per cent of the Group’s
consolidated profit after taxation and minority interests,
split as to one third / two thirds between the interim and
final dividends. The Board is therefore recommending a
final dividend payment of 2.35 Eurocents, in line with this
policy, to be paid on 9 June 2006 to shareholders on the
register on 12 May 2006.
Chief Executive Officer
Management and staff were all shocked by the sad and
unexpected death of Dick Tilanus, the Company’s CEO,
in January 2006. Dick joined the Punch International
Group as CEO of the Graphic Solutions Division in
November 2004 and led the formation of Punch Graphix
and its subsequent flotation. The performance of the
group in its maiden year, detailed in this report, is a
testament to Dick’s managerial skills. He was an
inspiration to us all and will be sorely missed.
The process to recruit a new CEO was completed on 5
April 2006, with the announcement of the appointment
of Ben C. Van Assche.
Ben C. Van Assche was previously CEO of Cytec Surface
Specialties nv and a member of the Executive Committee
of the Cytec Group. Before that he was a member of the
Executive Committee of the UCB Group, responsible for
the chemical sector.
We are extremely pleased to welcome Ben to Punch
Graphix. Ben’s experience will allow us to continue with
our stated strategy and he will bring further focus to our
internal and external global growth ambitions.
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