Homag Group AG — Earnings Release 2010

Nov 12, 2010

News Details

Corporate | 12 November 2010 07:07

The HOMAG Group outpaces the industry

Homag Group AG / Key word(s): Quarter Results

12.11.2010 07:07

• 2010 order intake already exceeds level of full-year 2009 after only nine
  months
• Liquidity rises substantially in the third quarter of 2010
• Company announces heavy investment in future markets and further growth
  for 2011

Schopfloch, November 12, 2010. The positive trend reported by HOMAG Group
AG in the first half of the year has continued into the third quarter of
2010. As a result, the world's leading manufacturer of machines and
production lines for the wood processing industry was able to clearly
improve on its prior-year sales revenue, order intake and earnings figures.
Sales revenue was up 26 percent to EUR 171 million (prior year: EUR 135
million). Between July and September 2010, order intake climbed to EUR 136
million (prior year: EUR 107 million) and order backlog reached EUR 203
million on September 30, 2010 (prior year: EUR 173 million).

CEO Rolf Knoll sees the good third quarter as confirmation that 'the
current fiscal year has served to secure the recovery from the crisis.'
Apart from the successfully implemented cost improvement program, he
attributes the above-trend development compared to the industry mainly to
the broad and innovative product portfolio as well as the HOMAG Group's
global presence. 'This allows us to benefit directly from the various
segments within our industry and the regions around the globe at the
forefront of the global recovery,' Knoll explains. The Company reports that
it is extremely successful in the growth markets China, India, Brazil and
Russia. These contributed more than 24 percent to order intake in the third
quarter of 2010.

Despite some special factors, the HOMAG Group generated a slight net profit
for the third quarter of 2010 again, together with an EBITDA margin before
employee profit participation and before restructuring/non-recurring
expenses in relation to sales revenue at the same level as in the first
half of 2010. Accordingly EBITDA before extraordinary expenses of EUR 0.8
million for restructuring measures/non-recurring effects and before the
result from employee profit participation (EUR -1.2 million) came to EUR
13.7 million (prior year: EUR 5.5 million), while EBT on the same basis
reached EUR 3.4 million (prior year: EUR -2.7 million). The net profit for
the period after non-controlling interests improved to EUR 0.3 million
(prior year: EUR -2.9 million), which equates to earnings per share of EUR
0.02 (prior year: EUR -0.18).

CFO Andreas Hermann does not hide his satisfaction with the current
liquidity situation: 'Within only a year, we have cut our net liabilities
to banks very substantially from EUR 112 million to EUR 67 million as of
September 30, 2010. Plus our cash flow has also significantly improved
thanks to the continued optimization of our receivables management.'

From 4,954 employees at year-end 2009, the Company's headcount increased to
5,040 (prior year: 5,017 employees) as of September 30, 2010, including
over 50 new apprentices.

First to third quarters of 2010
With sales revenue after nine months up 37 percent to EUR 517 million
(prior year: EUR 376 million) and order intake up 54 percent to EUR 436
million (prior year: EUR 283 million), the HOMAG Group has practically
matched the sales revenue and, indeed, exceeded the order intake figures
reached in the full prior year 2009 within a mere three quarters. In the
first nine months of 2010, EBITDA before extraordinary expenses and before
the result from employee participation came to EUR 41.4 million (prior
year: EUR 5.0 million) and EBT on the same basis came to EUR 12.1 million
(prior year: EUR -20.3 million). The net profit for the period after
non-controlling interests improved to EUR 3.1 million (prior year: EUR
-21.7 million), and leads to earnings per share of EUR 0.20 (prior year:
EUR -1.38).

Outlook
Owing to the good order situation, the management board is confident that
the HOMAG Group will comfortably exceed the sales revenue of EUR 650
million forecast for 2010, and expects to grow its sales revenue by as much
as 30 percent compared to 2009. This means that the Company would
outperform the industry, as the VDMA ['Verband Deutscher Maschinen- und
Anlagenbau e.V.': German Engineering Federation] anticipates revenue growth
of 18 percent for 2010. Order intake is likewise expected to grow by more
than 25 percent in fiscal 2010, despite the cooling down usually seen in
the industry in the fourth quarter. The management board also anticipates a
slight net profit for 2010.

CEO Knoll looks ahead to the coming year with optimism, and aims to ratchet
up sales revenue above the EUR 700 million mark, while raising earnings
even faster. The growth markets China and India are expected to contribute
to the positive trend. Indeed, in October the supervisory board approved an
investment package of EUR 8 million for the period up to 2011 as proposed
by the management.

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Background information
With its 16 specialized production companies worldwide, 20 group-owned
sales and service companies and approximately 60 exclusive sales partners,
HOMAG Group AG's market position is excellent and its portfolio as a
comprehensive system supplier and technology partner makes it unique.
Backed by a workforce of some 5,000 employees, the company sees itself as
the leading global manufacturer for plants and machinery for the
woodworking and wood materials industry for the production of furniture and
construction elements as well as timber frame houses. The group also offers
its customers a wide range of services in related areas for production
machines and equipment. HOMAG Group AG shares have been trading on the
Prime Standard of the Frankfurt Stock Exchange since July 13, 2007 and were
listed on the SDAX of the German Stock Exchange on October 2007.

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Disclaimers
This press release contains certain statements relating to the future.
Future-oriented statements are all those statements that do not pertain to
historical facts and events or expressions pertaining to the future such as
'believes', 'estimates', 'assumes', 'forecasts', 'intend', 'may', 'will',
'should' or similar expressions. Such future-oriented statements are
subject to risks and uncertainty since they relate to future events and are
based on current assumptions of the company, which may not occur in the
future or may not occur in the anticipated form. The company points out
that such future-oriented statements do not guarantee the future; actual
results including the financial position and the profitability of the HOMAG
Group as well as the development of economic and regulatory framework
conditions may deviate significantly (and prove unfavorable) from what is
expressly or implicitly assumed or described in these statements. Even if
the actual results of the HOMAG Group including the financial position and
profitability as well as the economic and regulatory framework conditions
should coincide with the future-oriented statements in this press release,
it cannot be guaranteed that the same will hold true in the future.

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Information:

HOMAG Group AG

Investor Relations
Simone Mueller
Phone: +49 7443 13-2034
simone.mueller@homag-group.com
www.homag-group.com

12.11.2010 Dissemination of a Corporate News, transmitted by DGAP -
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Language: English
Company: Homag Group AG
Homagstr. 3-5
72296 Schopfloch
Deutschland
Phone: +49 (0)7443 / 13 - 0
Fax: +49 (0)7443 / 13 - 2300
E-mail: info@homag-group.de
Internet: www.homag-group.de
ISIN: DE0005297204
WKN: 529720
Indices: SDAX
Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr
in Hamburg, München, Düsseldorf, Berlin, Stuttgart, Hannover

End of Announcement DGAP News-Service

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