Agfa-Gevaert reports decreased revenues for Q1

“In the seasonally weaker first quarter, the growth engines in the HealthCare IT and Digital Print & Chemicals divisions reported solid margin performances, which were offset by volume declines for some of our traditional products, as well as inflationary pressure. The Radiology Solutions division faced volume and price pressure for its medical film products due to the introduction of new centralized procurement practices in China. For the rest of the year, we expect the division’s volumes and margins to recover substantially versus the exceptionally weak first quarter.

Our disciplined working capital management and our broad cost reduction program continued to be successful. Additionally, several divisions announced price increase programs, which will allow us – when they will be in full effect – to mitigate the impact of raw material, packaging and freight cost inflation on our profitability.

In these first months of the year, we saw encouraging business developments for most of our activities. We expect the business momentum to continue in the second quarter,” said Pascal Juéry, President and CEO of the Agfa-Gevaert Group.

Pension de-risking measures
As mentioned previously, Agfa plans to spend about 350 million Euro of the proceeds of the sale of part of the HealthCare IT activities to increase the funding ratio of the funded pension plans in Belgium, the UK and the USA, as well as to implement pension de-risking actions. Agfa is well on track with this plan. The total amount contributed in 2020 was around 218 million Euro. In the first quarter of 2021, 16 million Euro was used for an annuity purchase in relation to the liabilities of the Swedish pension plan. In April, 103 million Euro was contributed to the UK pension plan to support an annuity purchase (buy-in), which was successfully placed. The whole pension program is expected to be completed in the second quarter of 2021.

Share buyback program
March 10, the Agfa-Gevaert Group announced a share buyback program with a volume of up to 50 million Euro. The program allows shareholders to benefit from the sale of part of the HealthCare IT activities and shows the Group’s confidence in its ongoing transformation process. The program was launched April 1. Every week, the Group issues a press release on the status of the program. During the first month of the program, the Group bought 686,118 shares for a total amount of 2.8 million Euro.

Revolving credit facility
In the first quarter of 2021, Agfa-Gevaert NV has closed a new three year multi-currency revolving credit facility of 230 million Euro. This new revolving credit facility will be used for general corporate purposes.
MB Bureau