The Belgium-headquartered manufacturer highlighted a strong performance by its Digital Print & Chemicals wing and at its previously problematic Offset Solutions division.
Overall sales in the three months to 31 March were up 7.2% at €424m (£362.7m), while adjusted EBITDA jumped by 22.2% to €19m.
Sales at Offset Solutions, still Agfa’s biggest division, were up 11.6% at €189m while adjusted EBITDA was up nearly four-fold, at €7.9m.
Agfa said the sales increase was fuelled by “successful price increases that have been implemented to tackle the raw material, packaging and freight cost inflation”.
Profit improvement actions included cutting admin costs.
“It is expected that cost inflation will continue to impact the business in the months to come. This impact will be mitigated by pricing actions. The most recent wave of price increases has come into effect in May 2022,” Agfa stated.
Agfa is reviewing the business model and its future options for the Offset Solutions unit and said plans to make it a standalone legal entity were “proceeding according to plan”.
At the Digital Print & Chemicals wing, which includes Agfa’s inkjet business, sales were up 9.1% at €79m but adjusted EBITDA slipped from €5.2m to €4.1m.
“Price increases have been implemented in almost all business areas to tackle the increasing raw material, packaging, energy and freight costs. The full impact of these price increases will become visible in the second half of the year. Further price increases will be communicated in the near future,” Agfa said.
The group also said that its sign and display business had “continued its upwards trend, both in terms of top line and bottom line”, and ink products continued to perform well, “clearly exceeding pre-Covid levels”.
Agfa announced it was acquiring Inca Digital Printers last month, with the deal expected to complete by the end of May.
Agfa CEO Pascal Juéry said that all of the group’s input costs from raw materials, energy, packaging, transportation and salaries “continue to increase materially” and supply chain disruptions were having a big impact on Agfa’s activities.
“We are living in a time of extraordinary inflation, geopolitical uncertainties and in particular the Russia-Ukraine conflict, unseen volatility in our supply chains and continuing Covid effects, particularly in China,” he stated.
“In this complex inflationary context, we are able to maintain margins through pricing and cost management actions. Driven by the strong performance of the Offset Solutions division, we significantly improved our recurring EBITDA, which shows that our pricing strategy and strict cost management are paying off.”
Juéry said the Inca buy would strengthen Agfa’s position in the high-speed wide format market as a whole, “and specifically in the promising packaging segment”.
“Digital printing is a profitable growth engine for us with a tremendous potential that will be further accelerated by the addition of Inca.”
At Agfa’s other operations, sales at its Healthcare IT wing slipped slightly to €55m and adjusted EBITDA fell by 32.3% to €4.4m as sales and profits are driven by projects reaching key milestones.
At Radiology Solutions, sales nudged up by 2.7% to €101m and adjusted EBITDA slipped 2.9% to €7m.
The group’s share buyback programme announced in March 2021 has now purchased more than 11m shares. The maximum volume under the scheme is 50m shares.
