KHD Humboldt Wedag International AG

Earnings Release • Mar 30, 2012

News Details

Corporate | 30 March 2012 10:09

KHD Humboldt Wedag International AG: KHD posts virtually unchanged EBIT margin despite fall in revenue

KHD Humboldt Wedag International AG / Key word(s): Final Results

30.03.2012 / 10:09

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KHD Humboldt Wedag International AG posts
virtually unchanged EBIT margin despite fall in revenue

• Global economic crisis is felt

• Revenue down but EBIT margin remains satisfactory at 7.5%

• Constructive cooperation with AVIC leads to first projects

• Order intake expected to increase in 2012, but revenue and EBIT likely
  to fall

Cologne, Germany - March 30, 2012: KHD Humboldt Wedag International AG
(KHD), one of the world's leading suppliers of equipment and services for
the cement industry, published its 2011 Group Annual Report today. Group
revenue fell from EUR 286.9 million to EUR 234.6 million, largely as a
result of delayed projects. Nevertheless, KHD succeeded in maintaining a
virtually unchanged EBIT margin of 7.5% (previous year: 8.7%). The
Management Board expects that operating conditions will remain difficult in
the markets relevant for KHD in 2012. Nevertheless, it forecasts a rise in
order intake. However, the Company does not expect to match its 2011 EBIT
margin and revenue in the current financial year.

Demand dropped on the worldwide cement market in 2011. The global economic
turmoil was felt, even in high-growth countries such as China, India, and
Russia. This resulted in lower economic growth which had consequences for
construction. Many customers also struggled with financing for their
projects. For KHD this meant that a number of contracts were delayed in the
2011 financial year. Order intake was also lower, at EUR 224.7 million in
2011 compared with EUR 268.9 million a year earlier.

Revenue was down by 18.2% in 2011 at EUR 234.6 million. The operating
result (EBIT) also fell, from EUR 25.0 million to EUR 17.6 million. With
the aid of consistent cost management, KHD secured an EBIT margin of 7.5%
(previous year: 8.7%). The completion of a large high-margin order and
valuation effects also had a positive effect on the figure. The valuation
effects arose in connection with the acquisition of the remaining shares in
the Russian subsidiary KHD Humboldt Engineering OOO, Moscow, Russia. Group
net profit fell from EUR 15.8 million to EUR 13.5 million.

Company management was pleased with the progress of the cooperation with
Chinese partner and shareholder AVIC. AVIC holds a 20% stake in KHD
following the capital increase carried out in the first quarter of 2011.
The attractive combination of KHD's premium technology and competitive cost
structure has improved the company's position in the EPC sector which has
led to the first joint contract in Venezuela. The partnership with Weir
Minerals - which aims to ramp up use of roller presses in the mining
industry - also gathered pace in 2011.

The proceeds of approximately EUR 75 million from the capital increase
further improved the Group's equity base. The equity ratio was 54.1% as of
December 31, 2011, having stood at 35.9% at year-end 2010. At EUR 300.3
million the liquidity position was comparable to the previous year's
figure. This gives the Group a sound basis for future growth. At the Annual
General Meeting 2012 the Management and Supervisory Boards will propose
that no profits should be distributed in the interests of sustainably
increasing the Company's value.

'2011 was a challenging - but good - year for KHD,' commented CEO Jouni
Salo, summing up the course of business for the 2011 financial year. 'We
finished 2011 in a much better competitive position than we were in at the
beginning of the year.' He added that more service, more customer focus,
more efficiency and more tenders for turnkey plants around the world were
all positive developments which should give the Company a good starting
point for 2012 and beyond.

KHD expects to see a moderate increase in its order intake in 2012 due to
its improved market position. However, its revenue and EBIT margin are not
expected to reach their 2011 levels, especially given that further delays
are anticipated in the completion of projects due to difficult market
conditions.

The complete 2011 Annual Report for KHD Humboldt Wedag International AG can
be downloaded from the Investor Relations section of the Company's website,
www.khd.com.

KHD Group
KHD is a global leader for providing equipment and services to cement
producers with over 150 years of experience in the cement industry. Process
engineering and project management are among the core competencies of the
technology-focused group. KHD offers a wide spectrum of products and
services for the cement industry and is a leader in environmentally
friendly and energy-efficient products for the grinding and pyroprocessing
sections of the plants. The holding company KHD Humboldt Wedag
International AG, based in Cologne, Germany, coordinates its
internationally operating subsidiaries. The group employs more than 750
employees worldwide with customer service centers in growing markets like
India, Russia and the Asia Pacific region. Other major customer service
centers include 'Americas' covering both North and South America and EMEA
Europe, Middle East and Africa), based in Cologne. KHD Humboldt Wedag
International AG (ISIN: DE0006578008, WKN: 657800) is listed on the
Frankfurt stock exchange (General Standard). More information: www.khd.com

Contact:
KHD Humboldt Wedag International AG
Elisabeth Prigge
Investor Relations
Tel.: +49 (0)221 - 6504-1500
Fax: +49 (0)221 - 6504-1409
E-Mail: Elisabeth.prigge@khd.com
Website: www.khd.com

End of Corporate News

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Language: English
Company: KHD Humboldt Wedag International AG
Colonia-Allee 3
51067 Köln
Germany
Phone: +49 (0)221 6504 1500
Fax: +49 (0)221 6504 1409
E-mail: elisabeth.prigge@khd.com
Internet: www.khd.com
ISIN: DE0006578008
WKN: 657800
Listed: Regulierter Markt in Frankfurt (General Standard);
Freiverkehr in Berlin

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