WashTec AG — Earnings Release 2005

Nov 2, 2005

News Details

Corporate | 2 November 2005 17:22

WashTec reports continued dynamic development in first nine months of 2005

WashTec AG / Key word(s): Quarter Results

02.11.2005 / 17:22

---

– Sales up 5.4% to EUR 161.0m

– Earnings before taxes grow from EUR 0.2m to EUR 10.8m – More product innovations to be launched soon

Augsburg, November 2, 2005 – WashTec AG, the market leader in vehicle washes, reports a successful business performance for the first nine months of 2005. An operating EBIT margin of 10.1% means that the company reached its target margin for the full year 2005 ahead of plan. ‘We have reached our ambitious target after nine months only. This shows that WashTec has successfully completed the restructuring and consolidation phase,’ explains Thorsten Krüger, Spokesman of the Company’s Board of Management. ‘In addition to the restructuring, we have also improved our balance sheet structure through the capital increase and the refinancing of our credit lines. An equity ratio of 26% gives us the scope we need to invest in growth projects going forward.’

A look at the development of the individual quarters shows that sales and earnings growth was highly dynamic. While the company reported a EUR 4.9m increase in sales for the first six months of the year, the third quarter saw sales rise by EUR 3.3m. Earnings before taxes (EBT) also developed dynamically as they more than doubled from EUR 4.9m as of June 30 to EUR 10.8m for the first nine-month.

Sales and earnings clearly up on the previous year

In the first nine months of the year, sales rose by 5.4% to EUR 161.0m, mainly due to the positive development of roll-over washes. In connection with the improved cost structures, the non-recurrence of goodwill amortisation and the reduced interest expenses, the increased revenues led to disproportionate earnings growth over the previous year.

Earnings before interest and taxes (EBIT) rose from EUR 6.8m to EUR 14.2m in the first nine months and from EUR 4.3m to EUR 6.7m in the third quarter of 2004 and 2005 respectively. Financial expenses were almost halved by an impressive EUR 3.2m to EUR 3.4m through the repayment and refinancing of bank liabilities. Earnings before taxes (EBT) rose by EUR 10.6m to EUR 10.8m in the nine-month period and by EUR 3.7m to EUR 5.9m in the third quarter of 2004 and 2005 respectively. This amount includes non-recurring expenses resulting from extraordinary expenses in connection with the refinancing and provisions for further optimisation programmes totalling EUR 2.1m in the nine-month period. Accordingly, the operating result amounted to EUR 12.9m. The profit after taxes improved from EUR -1.5m to EUR 6.5m and by EUR 2.5m to EUR 3.5m in the third quarter of 2004 and 2005 respectively.

Marketing and product campaign continued

The marketing and product campaign was continued in the third quarter. Following the takeover of the Austrian sales and service activities, WashTec’s own local organisation can serve the market much more professionally than in the past. ‘Customers’ response to the Washtec organisation has been very positive,’ Thorsten Krüger explained, ‘which is not least reflected in increasing new order intake especially in Service.’ Building on its presence in Austria, the company aims to better exploit the potential offered by emerging markets in Eastern Europe.

At the same time, WashTec’s product portfolio have been expanded according to plan. While the second quarter saw the introduction of the SoftCare Takt rollover system in the premium segment, SoftCare Bravo was launched in the third quarter. SoftCare Bravo replaces the CK30 in the basic segment and is particularly suited for car dealerships, garages and smaller gas stations. More innovations will follow in 2006.

Additional growth planned for 2006

WashTec expects the positive business performance to continue in the fourth quarter, which has traditionally been the company’s strongest quarter. In view of the continued negative earnings performance of the Canadian subsidiary, SSI Corp., a comprehensive analysis of the subsidiary’s suitability for reorganisation is being conducted. Depending on the outcome, this may lead to non-recurring expenses of up to EUR 2m in 2005. ‘Being the most innovative and profitable company in this market, we will continue our product and marketing campaign with innovative products and exploit the market more effectively in 2006. In addition, the improved cost structures and new projects will contribute to a continued positive earnings performance,’ said an optimistic Thorsten Krüger.

The quarterly report 3/2005 is available under www.washtec.de.

Contact:

Karoline Kalb, Investor Relations

WashTec AG

Argonstraße 7

86153 Augsburg

Tel.: +49 (0)821 – 55 84 – 0

Fax: +49 (0)821 – 55 84 – 12 06

End of Corporate News

---

02.11.2005 Dissemination of a Corporate News, transmitted by DGAP – a company of EQS Group AG.

The issuer is solely responsible for the content of this announcement.

DGAP’s Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases.

Media archive at www.dgap-medientreff.de and www.dgap.de

---

Language:	English
Company:	WashTec AG
	Argonstraße 7
	86153 Augsburg
	Germany
Phone:	+49 (0)821 55 84-0
Fax:	+49 (0)821 55 84-1135
E-mail:	washtec@washtec.de
Internet:	www.washtec.de
ISIN:	DE0007507501
WKN:	750750
Listed:	Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin, Düsseldorf, München, Stuttgart

End of News	DGAP News-Service

- - -
932  02.11.2005