Surteco Group SE

Earnings Release • Aug 31, 2005

News Details

Ad-hoc | 31 August 2005 07:38

SURTECO AG: Market environment continues to impact negatively on business

Ad hoc announcement §15 WpHG Half Year Result SURTECO AG: Market environment continues to impact negatively on business Ad hoc announcement transmitted by DGAP. The issuer is solely responsible for the content of this announcement. —————————————————————————— Buttenwiesen-Pfaffenhofen, 31 August 2005 – Apart from the sustained weak domestic economy, SURTECO AG also posted falling sales in key foreign markets due to slack demand. However, the business in North America that SURTECO AG significantly strengthened with the acquisition of the Canplast Group in autumn of 2004 gives grounds for a positive assessment. Not least as a result of this acquisition, the sales of the Group – one of the leading suppliers to the construction and furnishing industry worldwide – increased by 3 % compared with the previous year to 199 million euros during the first half of 2005. Adjusted for first-time consolidation, the company experienced a drop in sales of 3 %, triggered in particular by the absence of an upswing for business in Germany. After the first six months of this year, domestic business at 73.6 million euros remained 4 % below the comparative value for the previous year. Performance in the Strategic Business Units Paper and Plastics varied. The Strategic Business Unit Paper, through which SURTECO AG supplies flat foils and edging strips based on paper primarily to the market segments doors, furniture and interior design, experienced a 12 % drop in sales for the first half of 2005 amounting to 87.4 million euros due to the fall in demand across Europe. Sales of the SBU Paper in Germany at 30.7 million euros were 5 % below the equivalent year-earlier figure. Despite the difficult framework conditions in furniture manufacturing and the construction sector during the first half of the year, SURTECO AG succeeded in generating sales revenues of 111.6 million euros in the Strategic Business Unit Plastics – with plastic edging tapes, technical extrusions (profiles) and roller-shutter systems – to outperform the figures for the previous year by 18 %. The acquisition of Canplast played a significant role in this very positive increase. Adjusted for the effects of consolidation, sales at the SBU Plastics still went up by 6 % compared with the comparative period for the previous year. In Germany, sales of 42.8 million euros fell short of the figure for the previous year by 4 %. The difficult sector environment put a corresponding damper on earnings at SURTECO AG. EBITDA at 35.5 million euros lagged 7 % behind the half-year EBITDA for 2004. In order to be able to continue playing a leading role in the competition, SURTECO AG had already announced a projected 150 job losses in spring by mid-2006. After deducting restructuring expenses for this measure totalling 4.3 million euros, EBT for the first six months of this year amounts to 17.8 million euros (-6 %), without special effects EBT would have been 22.1 euros (+9 %). SURTECO AG is attempting to expand the existing lead on the competition by implementing a series of technological innovations. The company wants to use the new printing and processing techniques to open up additional advantages and use quality to strengthen its significant global market shares of approximately 37 % in plastic edges and as much as 59 % in edging strips based on paper. Taking into account the current overall economic framework and the conditions prevailing on the currency and raw-materials markets, SURTECO AG continues to project slight growth in sales related to consolidation for the fiscal year 2005 compared with the previous year (380.4 million euros). Operating comparable EBT will not match up to the record result for 2004 (34.7 million euros). SURTECO AKTIENGESELLSCHAFT Johan-Viktor-Bausch-Str. 2 86647 Buttenwiesen-Pfaffenhofen Deutschland ISIN: DE0005176903 WKN: 517 690 Listed: Amtlicher Markt in Frankfurt (Prime Standard) und München; Freiverkehr in Berlin-Bremen, Düsseldorf und Stuttgart End of ad hoc announcement (c)DGAP 31.08.2005 310738 Aug 05