The course of the past financial year was successful for the FP Group. The company strategy is starting to prove successful. The new, flexible production site in Wittenberge is running smoothly. The new, innovative franking system PostBase is very popular with our clients; in 2013 the modular PostBase system was introduced in the most important sales markets. The new digital ranges, particularly the De-Mail solutions, are also attracting wide interest from our clients in Germany.
Chances in material items in the Group statement of comprehensive income.
Business performance by segment
The company is divided into four segments, namely Production, Sales Germany, International Sales, and Central Functions. This segmentation corresponds to the FP Group’s internal reporting.
The FP Group was able to strengthen its financial clout in the period under review. To do this, it primarily used the cash flow from operating activities to finance itself, along with existing or newly signed loan agreements with financial institutions and finance lease agreements of less than one year. These liabilities were below the previous year’s level as at 31 December 2013. Reference is made to the “Hedging policy and risk management” Section of the consolidated financial statements with respect to potential effects of altered interest levels and loan conditions. At the year-end 2013, cash and cash equivalents stood at EUR 29.0 million compared with EUR 26.0 million at 31 December 2012.
The FP Group is pursuing a focused investment strategy and concentrating, in particular, on investments that will facilitate the company’s ongoing development into a complete service provider for mail communication. Investments remained relatively stable in 2013 at EUR 14.8 million after EUR 14.7 million in the previous year. The capitalisation of development costs decreased in 2013 to EUR 4.2 million, compared with EUR 5.2 million in the previous year, when development investments were still accruing for the new franking system PostBase and higher development costs were capitalised for De-Mail at the same time.
Asset situation and asset structure analyses
The balance sheet as of 31 December 2013 is characterized by an increase in non-current assets. Non-current liabilities are rising by EUR 8.4 million, primarily as a result of the newly arranged Group financing. Current assets barely saw a change from the previous year, whereas debts were significantly reduced compared with the previous year, likewise as a result of the refinancing.
Compared with 31 December 2012, total assets increased by EUR 0.9 million, from EUR 136.5 million* to EUR 137.4 million. The ratio of non-current assets to total assets rose from 50.9%* to 51.6%. As at 31 December 2013, the ratio of current assets to current liabilities was 107.7%, compared with 91.1%* one year before.
Overall statement on performance of the business
2013 was a good year of business for the FP Group. The company was able to achieve the objectives set down at the start of 2013 and even exceed them in some cases. On the revenue side, the company particularly benefited from the success of the franking system PostBase in a variety of markets, and from broadening the range of services in its German home market. PostBase was introduced in important markets such as the United Kingdom, Canada and Italy in 2013 and met with great interest there; investments in developing this promising system are starting to pay off. In Germany, the FP Group expanded its sales strategy and has since been offering its products and solutions – from the classic franking machine to the De-Mail gateway – via regionally established specialist retailers and also IT systems houses. In view of the E-Government Act, which entered into force in summer 2013, the FP Group also stepped up its De-Mail business. The company gained renowned partners and customers in 2013 in the shape of the Deutsche Rentenversicherung pension provider and the Süddeutsche Krankenversicherung health insurer.
On the earnings side, the company benefited from the increased effectiveness of the new production site in Wittenberge across the whole year for the first time. The new production site is able to react flexibly and swiftly to changes on the market and was therefore able to cope effortlessly with the rising demand for PostBase. Higher profitability in the operating business and higher revenues provided a crucial boost to the FP Group’s financial clout in 2013. Despite higher capital expenditure in rental markets, free cash flow improved significantly. In addition, the company was able to sign up for new long-term financing at more advantageous conditions in the period under review.
*) In the company report in the previous year 2012 the indicators Free cash flow
and Net debt were not indicated in the forecast, which is why no plan / actual
comparison is performed here.