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Title: Disclaimer


1
Disclaimer
  • Forward-looking statements
  • This report contains certain forward-looking
    statements within the meaning of Section 27A of
    the Securities Act of 1933, as amended referred
    to hereafter as the Securities Act, and Section
    21E of the Securities Exchange Act of 1934, as
    amended referred to hereafter as the Exchange
    Act. These forward-looking statements, which may
    be expressed in a variety of ways, including the
    use of future or present tense language, refer to
    future events. Océ has based these
    forward-looking statements on its current
    expectations and projections about future events.
  • Océs expectations and projections may change
    and Océs actual results, performance or
    achievements could be significantly different
    from the results expressed in or implied by these
    forward-looking statements based on various
    important factors, risks and uncertainties some
    of which are beyond Océs control and which are
    neither manageable nor foreseeable by Océ. When
    considering these forward-looking statements, you
    should keep in mind these risks, uncertainties
    and other cautionary statements made in this
    presentation or Océs annual or periodic reports
    filed with the United States Securities and
    Exchange Commission. In view of these risks,
    uncertainties and assumptions, the
    forward-looking events presented today might not
    occur.
  • These factors, risks and uncertainties, which
    include, but are not limited to, changes in
    economic and business conditions, customer demand
    in competitive markets, the successful
    introduction of new products and services into
    the markets, developments in technology, adequate
    pricing of products and services, competitive
    pricing pressures within Océs markets, the
    financing of Océs activities, efficient and
    cost-effective operations, changes in foreign
    currency exchange rates, fluctuations in interest
    rates, uncertainty of political situations,
    changes in governmental regulations and laws, tax
    rates, successful acquisitions, joint ventures
    and disposals and the effects of recent and
    potential future terrorists attacks and the war
    on terrorism.
  • For a more detailed discussion of the risks,
    uncertainties and other factors that may affect
    Océs actual results, performance or
    achievements, you should refer to pages 69 to 73
    of the Annual Report for 2004, to pages 6 to 11,
    56 and 57 of Océs 2004 Annual Report on Form
    20-F and any other filings made by Océ with the
    United States Securities and Exchange Commission.
  • Océs forward-looking statements speak only as
    of the date on which the statements are made, and
    Océ undertakes no obligation to update or revise
    publicly any forward-looking statement, whether
    as a result of new information, future events or
    otherwise.

2
Printing for Professionals
  • Results second quarter 2005
  • Rokus van Iperen
  • CEO

2
3
Agenda
Summary Q2 2005
Profile
Financial Results Q2 2005
Strategic Business Units
Strategy
Outsourcing Manufacturing
Leasing
Outlook
4
Summary Q2
  • Operational performance second quarter 2005
  • 2.5 organic growth in sales of print systems
  • Stable development in recurring revenues (-/-
    4.8)
  • First printers from Asia have been shipped to
    customers
  • Financials second quarter 2005
  • Operating profit Euro 13.6 million
  • Operating profit from commercial activities Euro
    7.5 million
  • Net profit Euro 10.6 million
  • Free cash flow Euro 34.9 million

5
Agenda
Summary Q2 2005
Profile
Financial Results Q2 2005
Strategic Business Units
Strategy
Outsourcing Manufacturing
Leasing
Outlook
6
Profile
Revenues by regions
Europe (58)
ROW (7)
Americas (35)
Revenues by category
80
28
72
20
Recurring revenues
Non-recurring revenues
2005
7
Strategic Business Units
  • Strategic Business Unit Digital Document Systems
    (69)
  • Corporate Printing 36
  • Commercial Printing 18
  • Business Services 15
  • Strategic Business Unit Wide Format Printing
    Systems (31)
  • Technical Documentation Systems 18
  • Display Graphics Systems 3
  • Imaging Supplies 10

8
DDS Market Position
  • Competition
  • Corporate Commercial Canon, Ricoh, Xerox,
    Konica Minolta, IBM
  • Business Services Xerox, IKON, Pitney Bowes,
    Williams Lea/Bowne
  • Position
  • Number 5 in HV / VHV Document Printing
  • Number 2 in HV / VHV Transaction Printing
  • Number 4 in Commercial Printing
  • Number 5 in Business Services
  • Strengths
  • Own technology
  • Direct sales organisation
  • Customer loyalty
  • High service level
  • Large outsourcing business

9
WFPS Market Position
  • Competition
  • TDS HP, (Fuji)Xerox, Ricoh, KIP
  • DGS HP, Epson, Vutek, Kodak, etc.
  • Position
  • Number 1 in Technical Documentation (B/W)
  • Number 3 in Display Graphics (MV/HV)
  • Strengths
  • Own technology
  • Direct sales organisation
  • Customer loyalty
  • High service level

10
Agenda
Summary Q2 2005
Profile
Financial Results Q2 2005
Strategic Business Units
Strategy
Outsourcing Manufacturing
Leasing
Outlook
11
Financial Results Q2 2005
Euro million 2005 2004 ? ?
Organic Revenues 640.4 682.2 -/- 6.1
-/- 4.1 Gross Margin 257.5 293.1 -/- 12.1
-/- 10.2 Operating Costs 243.9 258.9 -/- 5.8
-/- 4.3 Operating Income 13.6 34.2 -/- 60.2 -/
- 54.1 Net Income 10.6 21.4 -/- 50.6 -/- 44.8
In euro per share Net Income 0.12 0.25 -/-
52.2 -
12
Balance Sheet
  • Euro million Q2 2005 Q2 2004
  • Fixed assets 867 1,004
  • Current assets 1,287 1,339
  • Total 2,154 2,343
  • Group equity 757 750
  • Interest bearing debt 454 554
  • Non-interest bearing liabilities 943 1,039
  • Total 2,154 2,343
  • Interest bearing debt
  • Long term 414 461
  • Short term 40 93
  • Total 454 554
  • Net debt 229 439

13
Non-Recurring Revenues
2005
Q1
Q2
2004
25
Q1
Q2
Q3
Q4
6
10
5
7
2002
2003
2001
2.5
-14
-10
-12
Excl. VLP
14
Industry Results
  • Autonomous Machine Autonomous Machine
  • Revenues Sales Revenues Sales
  • Canon 7 n.a. 7 n.a.
  • Hewlett-Packard 2 n.a. 2 5
  • Océ 0 7 2 12
  • Ricoh 3 n.a. 0 n.a.
  • IKON - 3 3 - 7 2
  • Xerox - 3 2 - 3 - 2
  • Danka - 11 - 8 - 14 - 10
  • Sources Company reports

FY 2004
Q1 2005

H1 2005
15
Recurring Revenues
2002
2004
2003
2005
2001
Q1
Q2
Q3
Q4
Q1
4
2
Q2
2
-1.7
- 4.3
-2.0
-2.5
-2.1
-1.7
-2.0
- 1
- 1
- 3
- 3
- 3
- 3
- 4.8
- 5.0
Total Population related
- 7.5
16
Breakdown Recurring Revenues 2004/2005
  • In points of total recurring Q2 Q3 Q4 Q1
    05 Q2,05
  • sec sec sec sec sec
  • Population-related revenues
  • DDS - 2.6 - 2.2 - 4.3 -1.9 -1.9
  • WFPS 0.5 0.2 0.0 0.2 -0.1
  • Business Services 2.1 1.5 - 0.2 - 0.8
    -0.5
  • Imaging Supplies - 0.5 - 0.6 - 1.0 - 0.4
    0
  • Interest income lease - 0.7 - 1.6 -2.0 -2.1
    -2.3
  • Total recurring revenues - 1.3 -2.7 - 7.5 -
    5.0 -4.8

17
Agenda
Summary Q2 2005
Profile
Financial Results Q2 2005
Strategic Business Units
Strategy
Outsourcing Manufacturing
Leasing
Outlook
18
Digital Document Systems Results Q2 2005
  • Euro million 2005 2004 ? Organic
  • Revenues 432 470 -/- 8.0 -/- 2.7 )
  • EBIT 0 18 -/- 99
  • Print systems (non-recurring) -/- 7.3 -/-
    0.5 )
  • Services (recurring) -/- 8.3 -/- 3.4 )
  • ) Excluding VLP effect

19
Digital Document Systems 2005
  • Growth in sales of print systems
  • Slowdown in Q2 is not structural, because of
  • Strong demand for colour printers and HV/VHV
    monochrome printers
  • Recurring revenues will improve in H2 2005
  • Trend is improving quarter by quarter
  • Recurring revenues are now growing in some
    regions
  • Positive impact of high demand for new machines
  • Profitability will improve in H2 2005
  • Higher profitability in Business Services
  • Stronger focus on cost control and reduction of
    working capital
  • Lower cost prices by manufacturing in Asia

20
Wide Format Printing Systems Results Q2 2005
  • Euro million 2005 2004 ? Organic
  • Revenues 208 212 -/- 1.8 2.2 )
  • EBIT 13 16 -/- 16.8
  • Print systems (non-recurring) 3.5 8.5 )
  • Recurring -/- 4.0 -/- 0.5 )
  • ) excluding VLP effect

21
Wide Format Printing Systems 2005
  • Continued growth in sales of print systems
  • Growth in TDS driven by colour
  • Continued strong growth in DGS driven by new
    productportfolio
  • Recurring revenues (excl. lease) will increase in
    H2 2005
  • Growth in population-related revenues
  • Growth in Imaging Supplies
  • Profitability will improve in H2 2005
  • Growth in machine sales and population-related
    revenues
  • Focus on cost control and reduction of working
    capital
  • Lower cost prices by manufacturing in Asia

22
Agenda
Summary Q2 2005
Profile
Financial Results Q2 2005
Strategic Business Units
Strategy
Outsourcing Manufacturing
Leasing
Outlook
23
Strategic Objectives
  • Océ strives for a Top 3 position in the selected
    strategic market segments
  • Technical Documents
  • Display Graphics
  • Productive Printing in Corporate and Commercial
    segments
  • Océ aims for a leading position in
    document-related Business Services
  • Financial objectives RoA 12 RoE 18

24
Strategic Segment Developments 2003-2008
  • Strategic Segment Size 2003 CAGR
  • Technical Documentation 3.5 billion -/- 1
  • Colour 1.4 billion 2
  • Display Graphics 2.6 billion 6
  • Corporate Printing 8 billion 5
  • Commercial Printing 9.2 billion 11
  • Document Management 10.4 billion 9Services and
    Software

25
DDS Strategic Actions
  • Investments in distribution
  • Expansion of direct sales force
  • Possible acquisitions / Partnerships in
    distribution
  • Investments in competitive product portfolio
  • RD activities in colour, software and HV-B/W
  • Outsourcing of manufacturing to Asia
  • Higher added value solutions in Business Services
  • Operational Excellence
  • Cost reduction in IT, Logistics and Purchasing
  • Reduction of working capital

26
WFPS Strategic Actions
  • Investments in distribution
  • Expansion of sales channels in USA, Germany and
    Asia
  • Possible acquisitions
  • Investments in competitive product portfolio
  • RD activities focus on colour and software
  • Outsourcing of manufacturing to Asia
  • Focus on DG-media in Imaging Supplies
  • Operational excellence
  • Cost reduction in IT, Logistics, Purchasing
  • Reduction of working capital

27
Agenda
Summary Q2 2005
Profile
Financial Results Q2 2005
Strategic Business Units
Strategy
Outsourcing Manufacturing
Leasing
Outlook
28
Outsourcing of Manufacturing
  • First phase of outsourcing manufacturing
    according to plan
  • Cost price targets achieved
  • High quality standards maintained
  • 20 of original Venlo volume will be delivered
    from low cost countries in 2005
  • New Océ TDS100 fully assembled in Asia
  • Next phases of outsourcing announced
  • 50 of original Venlo volume will be delivered
    from low cost countries by end of 2006
  • Improved natural hedge
  • Shift of costs from euros to dollars
  • Level playing field with competition

29
Agenda
Summary Q2 2005
Profile
Financial Results Q2 2005
Strategic Business Units
Strategy
Outsourcing Manufacturing
Leasing
Outlook
30
Leasing
  • Main part of portfolio has been outsourced
  • 60 of total lease outsourced
  • Euro 349 million of lease on Q2 2005 balance
    sheet
  • Temporarily high cash balances
  • Proceeds of the sale will be used for
  • Repayment of debt and deferred taxes
  • Investments and acquisitions
  • Buy back of shares
  • Outsourcing outside Europe is temporizedexpected
    year end lease debtors on balance sheet Euro
    300 million

31
Commercial vs Financial Results
  • Euro million Q2 2005 Q2 2004
  • Commercial activities
  • Revenues 631.3 661.7
  • Operating Income 8.8 19.5
  • Profit on sale of lease contracts 1.3 10.5
  • Operating Income excl. sale of
  • lease contracts 7.5 9.0
  • Financial activities
  • Revenues 9.1 20.5
  • Operating Income 4.8 14.7

32
Agenda
Summary Q2 2005
Profile
Financial Results Q2 2005
Strategic Business Units
Strategy
Outsourcing Manufacturing
Leasing
Outlook
33
Outlook 2005
  • Expected growth in sales of print systems through
  • Momentum of new products especially colour
  • Investments in distribution power
  • Will lead to
  • Increase of installed base of digital machines
  • Growth of print volume
  • This will lead to a reversal of the declining
    trend in recurring revenues, which we expect to
    take placein the second half of 2005
  • Growth of operational result of commercial
    activities excluding lease effects
  • Net profit for 2005 will be below 2004 because of
    the reduced revenues from leases
  • Based on the developments of the business as
    presented today

34
Questions Answers
35
Printing for Professionals
35
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