In 2013 the FP Group celebrated its 90th anniversary. The company has grown and evolved from its origins, and today we are more than just a franking machine manufacturer. Today, Francotyp-Postalia is an expert in innovative mail communication, with franking systems, mail services and software packages. In recent years we have taken numerous steps to align the FP Group successfully. These steps have led to important milestones: We have a new production facility in Wittenberge; we have successfully developed and launched the new PostBase franking system; we have acquired an important order for the Russian market and now have a presence in France; we have become the first accredited De-Mail provider; and we are also continuing to grow in the areas of outsourcing and mail services. This development has confronted the whole company with enormous challenges in the past years and has demanded a high degree of willingness to change on the part of all involved. The present consolidated financial statements for 2013 show that this determination is beginning to pay off, with revenue growth of 2% to EUR 168.9 million and EBIT improving 14.3% to EUR 10.4 million. Concentration on profitable growth is strengthening earning and financial power as planned, with free cash flow improving within the year by EUR 10.5 million to EUR 3.5 million.
Rising profits and capital inflows are making it possible for the Management Board and Supervisory Board to propose distribution of a dividend of EUR 0.08 per share for the past financial year to the Annual General Meeting on 19 June 2014. This proposal is just a beginning, with the knowledge that we will still have to invest heavily in 2014 for the successful further development of Francotyp-Postalia. In future, we intend to let our shareholders participate regularly in the company's success, and we should like to thank you at this point for your confidence and ongoing engagement during the past years which have not always been easy.
The positive development of FP and the trust of its shareholders were also reflected in 2013 in our share price, which rose within the year by around 67% to EUR 4.17. The visible success of FP's strategy strengthened confidence in the capital market.
The banks also rewarded the improved balance sheet structure and positive development of the FP Group in group financing, which we secured at the start of 2013 for the next 3.5 years, with an optional extension of a further 1.5 years. The new loan includes some improved conditions which take into account the needs of the operating companies, and permit a greater degree of flexibility. With the increased financial scope, we are able to push ahead with our projects consistently and secure the future growth as planned.
FP is following a committed growth strategy, and is developing as a trendsetting global expert in physical and electronic mail communication. There are four priority areas in the further development of our operating business:
1. We are continuing to expand our franking and inserting machine business in traditional markets. Companies still send millions of letters every day, which they have to print out, insert and frank. FP provides custom solutions and professional advice for such requirements. The innovative PostBase franking system is now available in all major markets, and is very popular, with over 15,000 PostBase systems in use in the USA alone.
2. We are developing new and rapidly growing markets in emerging nations. In 2013 we delivered the first franking machines to Russia, and there are initial successes in sales in India as well. These countries are in the infancy of professionalised mail communication, and FP is there with them.
3. We are systematically strengthening the service business in our home market, Germany, because this is where FP offers an even more comprehensive range of services than in other markets, as a result of consolidation and hybrid mail.
4. We are the front runners in Germany in the area of fully-electronic mail communication. The growth potential of fully-electronic mail communication is the core of the fourth pillar of our growth strategy. For two years, the FP Group has been an accredited De-Mail provider, offering a secure, confidential and verifiable form of communication on the Internet for companies, authorities and individuals, in compliance with statutory requirements. As public authorities in Germany are required to offer an electronic means of communication from mid-2014, we expect further progress for De-Mail this year in becoming an important and accepted means of communication. FP has already acquired hundreds of companies and authorities as customers, including such prominent companies as Süddeutsche Krankenversicherung and Deutsche Rentenversicherung.
This is FP Group's strategy for continuing profitable growth in the years to come. But this is by no means a given: in its core business, the FP Group is sometimes operating in stagnant markets and competing in new business areas with major, financially sound providers of information technology and telecommunication. We are therefore pushing forward with our “Aufbruch 2015” initiative. At present, we are systematically establishing an indirect sales channel with specialist retailers in Germany as well as direct and agent sales. IT system companies and other experts are able to extend their portfolios in the area of physical and electronic mail communication through the use of FP products. In the past few months we have already gained several important partners, e.g. Büroring eG, a group of some 350 independent specialist office suppliers.
Another important project under Aufbruch 2015 is further optimisation of the cost structure. One measure in this is the return of the FP headquarters to Berlin. From October 2014, this will be home with around 5,000 m2 for sales, administration and product R & D. The site at Birkenwerder was considerably larger, so from 2015 on we will be saving costs of around EUR 1 million a year, to the benefit of our liquidity.
The relocation to one of Europe's leading technology centres is also a visible sign of FP Group's further development: where Birkenwerder stood for the age of production, Berlin stands for the new age of innovation and solutions. At this point we should like to thank all our employees for their commitment and readiness to support these changes. We also wish to thank our customers and partners for good cooperation in the past financial year. In 2014 we intend to continue the successes of 2013. We are planning on continuing our profitable growth, increasing revenue to at least EUR 173 million, EBITDA to at least EUR 25 million, and EBIT to at least EUR 12 million. All this shows that the further development of the FP Group is paying off!
Hans Szymanski Thomas Grethe
CEO & CFO CSO