Nordex SE — Earnings Release 2003

Feb 13, 2003

News Details

Ad-hoc | 13 February 2003 13:28

Nordex AG english

Weak demand exerting pressure on Nordex in the first quarter Ad-hoc-announcement processed and transmitted by DGAP. The issuer is solely responsible for the content of this announcement. ——————————————————————————– Weak demand exerting pressure on Nordex in the first quarter Turnover up 13 % / exports to other European countries higher Rostock, February 13, 2003. In the first quarter of its new fiscal year (October 1 – December 31, 2002), Nordex AG’s turnover rose by roughly 13 percent to EUR 108 million (previous year: EUR 96 million). However, sales underperformed expectations, contracting by roughly 7 percent over the year-ago quarter to around EUR 89 million (previous year: EUR 96 million). Even so, the positive trend in non-German European countries continued, contributing approximately EUR 27 million to sales (previous year: EUR 5.4 million). At EUR 67 million, order receipts failed to live up to the Company’s expectations (previous year: EUR 128 million). This shortfall in new business compared with the previous year is primarily due to the absence of major foreign orders in the quarter under review. In the same quarter one year earlier, Nordex had placed two large European orders worth EUR 60 million alone on its books. Negotiations concerning major wind farms are currently being delayed. Thus, the unclear situation with respect to construction permit procedures hampered growth in France, for example. It was not until January 3, 2003 that the French government adopted clear administrative rules. The Company posted a loss at the EBIT level of EUR 12.4 million in the first quarter (previous year: EBIT of EUR 2.7 million). In view of the unexpectedly muted sales, the cost of materials as well as personnel and other operating expenses rose significantly relative to total revenues. Moreover, one major project shaved roughly EUR 5 million off the Company’s bottom line. Nordex has announced that it will be taking immediate steps to bring its fixed costs into line with changed business volumes. Thus, up to 150 jobs are to be shed and other operating expenses trimmed by 20 percent this year. Part of these layoffs will take the form of cuts in external staff and will thus affect the cost of materials/sales ratio. The cost-cutting program already implemented will result in further improvements in the cost of materials. This program includes product standardization, the implementation of new components and materials as well as steps to streamline the ranges to concentrate on the primary sales mainstays. These adjustments will start to unleash their effects as of summer 2003 after inventories have been depleted and delivery contracts expire. Steps to implement leaner corporate structures have already been implemented. Beneath the parent company level, the only operative units will be Nordex Energy GmbH and the foreign companies. This has been accompanied by functional restructuring aimed, for example, at enhancing the efficiency of project management operations. Nordex is still on track to meeting its target of turnover of EUR 520 million this fiscal year. Given the cyclical nature of its business, the Company normally generates roughly 20 percent of its full-year turnover in the first quarter. Full-year EBIT is expected to come to around EUR 3 million. At the same time, Nordex will be striving for a cost of materials/sales ratio of around 83 percent. This ratio is to be cut to around 80 percent next fiscal year, allowing Nordex to post substantially improved earnings. Contact: Press and PR officer, Ralf Peters, Bornbarch 2, 22848 Norderstedt, Germany, Tel.: +49 40 500 98 100, Fax: +49 40 500 98 333 end of ad-hoc-announcement (c)DGAP 13.02.2003 ——————————————————————————– WKN: 587357; ISIN: DE0005873574; Index: Nemax-50 Listed: Geregelter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin, Bremen, Düsseldorf, Hamburg, Hannover, München und Stuttgart 131328 Feb 03