GEA Group AG

Earnings Release • Aug 10, 2003

News Details

Ad-hoc | 10 August 2003 21:11

mg technologies AG english

mg’s earnings depressed by substantial one-time charges Ad-hoc-announcement transmitted by DGAP. The issuer is solely responsible for the content of this announcement. ——————————————————————————– In the second quarter of 2003, the performance of mg technologies ag, Frankfurt, failed to meet expectations. This was largely attributable to one-time charges. The sales and earnings reported by the mg Group were down year on year during the period under review. In the second quarter, the Company generated sales of EUR 2.0 billion, which was 6.2 percent less than in the same period of last year. In the first half of the year, sales declined from EUR 4.3 billion to EUR 3.9 billion. In the second quarter it posted a pre-tax loss of EUR 21.2 million, EUR 100.4 million down on the figure it reported for the same period last year. In the first six months of the current fiscal year, consolidated pre-tax earnings came to EUR18.1 million, a year-on-year decrease of EUR 107.5 million. In the first half of 2003 alone, earnings were depressed by one-time charges of EUR 53.1 million. Moreover, the strong euro reduced the Group’s earnings by roughly EUR 25 million. mg technologies ag is currently conducting a thorough and comprehensive review, which will be completed in late fall. We aim to use this to strengthen the Company’s balance sheet and create sufficient financial leeway to enable us to take advantage of selected growth opportunities. Despite the difficult economic conditions and the continued strength of the euro, as things stand the operating results posted by the Group’s two main companies, GEA and Dynamit Nobel, for 2003 will be down only slightly year on year. However, mg still expects to be burdened by substantial one-time effects in the second half of the year: the Company’s balance sheet will be placed on a more conservative footing, which might necessitate changes to the accounting and valuation methods it applies. The Group’s structures, including its multi-level holding companies, are being scrutinized. Their simplification, which will incur one-time charges in the short term, will deliver significant cost savings for the future. The review will also entail a reassessment of risk. The mg Group’s earnings will therefore remain under considerable pressure throughout 2003. From today’s perspective, mg does not expect to see any improvement on its weak first-half earnings in the second half of the year. end of ad-hoc-announcement (c)DGAP 10.08.2003 ——————————————————————————– WKN: 660200; ISIN: DE0006602006; Index: MDAX Listed: Amtlicher Markt in Berlin-Bremen, Düsseldorf, Frankfurt (Prime Standard), Hamburg und München; Freiverkehr in Hannover und Stuttgart; EUREX 102111 Aug 03