Chief executive Bernhard Schreier said the economic climate had put restraints on advertising spend, leading to lower capacity utilisation and a reluctance to invest in new equipment. He added that the downturn had affected all divisions.
In Germany, capital expenditure for the print industry is down 11% on the same time last year, while Heidelberg's orders for the first quarter were down 20% on 2001's figures at £700m.
The company said there would be very little growth in the second half of the year, and that the upturn it had expected in July would be "heavily delayed".
Full details of the cost-cutting measures will be announced in the next few weeks, but Schreier said they would not influence Heidelberg's strategy. "We will continue to offer a full range of products to our customer base," he said.
Although Schreier said there were no plans to cut jobs, he added: "We are reviewing all possibilities to improve our future flexibility. This means all divisions and production sites will be checked."
A spokesman for German utilities group RWE, Heidelberg's major shareholder with a 50%-plus-one stake, declined to comment on the warning, but said it still planned to exit non-core businesses, including Heidelberg, by the end of 2003 (PrintWeek, 5 April).
Despite the downturn, Schreier said the company had seen interesting developments in Asia and Eastern Europe.
In a week full of stock market jitters Heidelberg was no exception, with its share price falling almost 9% on the news.
Story by Andy Scott
