Belgian imaging technology group Agfa-Gevaert reported a bigger-than-expected 46% drop in fourth-quarter operating profit, hit by one-offs and lower production, sending its stock sharply lower.
“We cannot be happy with this set of results and will... have to lower our earnings forecast,” Bank Degroof analyst Siddy Jobe said in a note to clients.
The company, which specializes in hospital imaging systems and top-end printers for publishers and newspapers, said on Wednesday that recurring earnings before interest and tax (REBIT) fell to €32 million ($40.60 million).
The market had been expecting REBIT of €43 million, according to the average forecast given in a Reuters poll of four analysts.
The group reported its net loss widened to €167 million in the fourth quarter from a loss of €27 million in the same period in 2007.
The bottom line was hit by an impairment on goodwill and other assets of €119 million and a tax charge of €16 million.
Sales for the fourth quarter dropped 12% to €761 million.
“As it is highly uncertain how deep the crisis will go and how long it will last it is impossible to give an outlook for the months to come,” Agfa-Gevaert said in a statement.
It warned, however, that it expected demand at its Graphics and Specialty Products businesses to continue to weaken.
Sales at its two biggest units, healthcare and graphics, declined 13.1% and 8.2%, respectively, while sales at the smaller specialty products division fell 2.7%.
Printers were postponing their investments in equipment, it said, and the slowdown in the advertising market was also leading to lower demand.
The healthcare unit would suffer less, although some projects could be delayed, the group added.
The group had not given specific guidance for 2008, saying in November that it was impossible to offer a clear outlook for the months to come, given the uncertain economic outlook.
Agfa, once a photographic company, has struggled to shift from declining analogue and traditional film-based products to digital applications for its core graphics and healthcare markets. (Reuters)