Westag AG — Interim / Quarterly Report 2007

Nov 8, 2007

Quarterly Report 3rd Quarter 2007

Sales

Divisions

The German construction industry developed positively in the period from January to August 2007. According to the Federal Statistical Office, incoming orders in the building construction sector rose by 1.8 %. Figures have deteriorated since the spring, however, with a decline of 7.6 % reported for the month of August alone. This is mainly attributable to slowing construction activity in the owneroccupied housing sector.

By contrast, Westag & Getalit AG boosted its sales also in the third quarter and achieved a 15.1 % increase in sales to € 167.7 million (2006: € 145.7 million) on a nine-month basis. Double-digit growth was again reported by all three divisions.

Export sales increased at a disproportionate rate of 23.6 % to € 42.3 million (2006: € 34.2 million). As a result, the export share climbed from 23.5 % in the previous year to 25.2 %.

Sales revenue	Jan. 01 - Sep.	Jan. 01 - Sep.	Change
(in €'000)	30, 2007	30, 2006	(in %)
Plywood/Formwork	37,707	28,683	31.5
Doors/Frames	66,337	59,503	11.5
Laminates/Elements	61,130	54,817	11.5

Sales in the Plywood/Formwork Division rose by 31.5 % to € 37.7 million. This strong increase was a direct result of our excellent market positioning, which allowed us to benefit particularly from the favourable construction activity.

The Doors/Frames Division boosted its sales by 11.5 % to € 66.3 million, with a strong increase achieved both in Germany and abroad.

The Laminates/Elements Division reported an 11.5 % increase in sales to € 61.1 million. The strong growth was supported primarily by rising exports and higher sales of our Getacore mineral worktops.

Results

Earnings before income taxes rose by an impressive 35.4 % to € 11.8 million in the first nine months of the year (2006: € 8.7 million). The main reason was the strong sales growth, which led to better capacity utilisation and to a decline in staff costs as a percentage of sales. The cost of materials as a percentage of sales showed a negative development (52.2 % compared to 49.5 % in the previous year). This is attributable to the fact that we have not been able to fully pass on the higher cost of materials by increasing our sales prices.

Net profit climbed to € 7.3 million (2006: € 5.2 million), while DVFA/SG earnings per share rose to € 1.26 (2006: € 0.97). The fact that DFVA/SG earnings increased at a lower rate than net profit is attributable to the retransfer of provisions in an amount of € 0.5 million that is adjusted in DVFA/SG earnings.

Profit data (in € '000)	Jan. 01 - Sep. 30, 2007	Jan. 01 - Sep. 30, 2006	Change (in %)
Earnings before income taxes	11,760	8,681	35.4
Net profit	7,291	5,209	40.0
Net profit per share (in €)	1.27	0.91	39.6
DVFA/SG earnings per share (in €)	1.26	0.97	29.9

Investments

Investments of € 15.4 million were planned for 2007. The construction activities for the automated cutting-to-size of elements and the expansion of our frames production capacity have largely been completed; in both cases, production is scheduled to start early next year. We have also taken initial measures to boost our own electricity generation.

Employees

Profit data (in € '000)	Jan. 01 - Sep. 30, 2007	Jan. 01 - Sep. 30, 2006	Change (in %)
Number of employees (incl. trainees/apprentices)	1,262	1,205	4.7

The higher performance allowed us to create new jobs. As a result, the headcount increased from 1,205 to 1,262 as of September 30, 2007. This figure also includes the higher number of apprentices and trainees. Due to investments made in the past and the good capacity utilisation, personnel expenses as a percentage of sales declined from 29.7 % in the previous year to 27.4 %. We continue to use temporary workers provided by HR service providers to cover capacity peaks.

Volume of own shares

As of September 30, 2007, Westag & Getalit AG's portfolio of own shares remained unchanged at 185,500 shares, all of which are preference shares.

Outlook

Some segments of the construction sector are giving cause for concern again. The number of permits granted for the construction of owner-occupied homes has slumped by up to 50 % in some regions. Our company is only moderately affected by this negative trend, as the decline has been offset by other distribution channels. This is not least confirmed by the very positive development of our sales figures, also in the third quarter. We will exceed the sales growth of a good 10 % projected at the half-year stage.

With regard to our earnings position, the situation in the commodities market remains a major challenge. The aim is to keep the cost increases relating to raw materials to a minimum. At the same time, we will inevitably have to pass unavoidable cost increases on to our customers in the form of higher sales prices.

From today's point of view, we are confident that, thanks to the good sales performance, we will exceed our pre-tax earnings projection of € 15.4 million issued at the half-year stage.

Rheda-Wiedenbrück, November 2007 Westag & Getalit AG The Management Board

Balance sheet

(in €' 000)	Sep. 30, 2007	Dez. 31, 2006
Intangible assets	342	333
Tangible assets	48,376	46,623
Financial assets	1,004	1,042
Deferred tax assets	61	0
Non-current assets	49,783	47,998
Inventories	36,240	32,122
Debtors and other assets	32,801	24,416
Cash at banks or in hand	12,536	16,728
Current assets	81,577	73,266
Total assets	131,360	121,264
Called-up share Capital	14,643	14,643
Capital reserve	24,345	24,345
Revenue reserves	35,111	35,111
Net profit for the year	10,727	8,135
Equity and reserves	84,826	82,234
Non-current provisions	16,793	16,559
Deferred tax liabilities	0	12
Non-current liabilities	16,793	16,571
Trade payables and other current liabilities	13,876	11,422
Current provisions	15,865	11,037
Current liabilities	29,741	22,459
Total equity and liabilities	131,360	121,264

Income statement on a quarterly basis

(in € '000)	Jul. 01 - Sep. 30, 2007	Jul. 01 - Sep. 30, 2006
Sales	57,852	50,339
In/decrease in inventories	- 449	- 369
Own work capitalised	59	124
Total operating performance	57,462	50,094
Other operating income	1,263	997
Cost of materials	30,058	25,202
Personnel expenses	15,566	14,254
Depreciation and amortisation	2,294	2,026
Other operating expenses	6,081	6,118
Other taxes	48	46
Operating result	4,678	3,445
Financial result	135	94
Investment result	0	0
Extraordinary items	0	0
Profit before income taxes	4,813	3,539
Income taxes	1,829	1,415
Net profit	2,984	2,124
DVFA/SG earnings per share (undiluted and diluted)	0.48	0.41
Number of shares (diluted and diluted)	5,720,000	5,720,000

(in € '000)	Jan. 01 - Sep. 30, 2007	Jan. 01 - Sep. 30, 2006
Sales	167,749	145,707
In/decrease in inventories	1,754	213
Own work capitalised	135	302
Total operating performance	169,638	146,222
Other operating income	2,445	1,586
Cost of materials	88,472	72,326
Personnel expenses	46,467	43,411
Depreciation and amortisation	7,018	6,484
Other operating expenses	18,646	16,977
Other taxes	144	142
Operating result	11,336	8,468
Financial result	424	213
Investment result	0	0
Extraordinary items	0	0
Profit before income taxes	11,760	8,681
Income taxes	4,469	3,472
Net profit	7,291	5,209
DVFA/SG earnings per share (undiluted and diluted) Number of shares	1.26	0.97
(undiluted and diluted)	5,720,000	5,720,000

Income statement on nine-months basis

Cash flow statement

(in €' 000)	Jan. 01 - Sep.	Jan. 01 - Sep.
	30, 2007	30, 2006
Operating result/EBIT	11,336	8,468
Income tax payments	- 4,963	- 3,550
Depreciation and amortisation	7,018	6,484
Result from asset retirements	- 300	- 68
Change in current assets	- 6,656	- 7,135
Change in liabilities	7,971	5,456
Cash flow from operating activities	14,406	9,655
Investments in fixed and financial assets	- 9,144	- 9,079
Change in financial assets	38	- 998
Income from fixed asset retirements	664	137
Cash flow from investment activities	- 8,442	- 9,940
Interest income	541	403
Interest expenses	0	0
Repayment of non-current financial liabilities	0	0
Acquisition/sale of own shares	0	- 1,070
Dividend payments	- 4,699	- 2,817
Cash flow from financing activities	- 4,158	- 3,484
Change in liquid funds	1,806	- 3,769
Liquid funds as of Jan. 01	7,737	10,346
Liquid funds as of Sep. 30	9,543	6,577

ment of changes in equity
State

in € '000	Subscribed capital	Capital reserve	Revenue reserve	Net profit for the year	Total
As of Jan. 1, 2006	14,643	24,345	31,911	3,296	74,195
Transfer to other reserve					0
Change in own shares				- 1,070	- 1,070
Addition in accordance with Sect. § 58 II AktG					0
Dividend				- 2,817	- 2,817
Net profit				5,209	5,209
As of Sep. 30, 2006	14,643	24,345	30,841	5,688	75,517
As of Jan. 01, 2007	14,643	24,345	35,111	8,135	82,234
Transfer to other reserve					0
Change in own shares					0
Addition in accordance with Sect. § 58 II AktG
Dividend				- 4,699	- 4,699
Net profit				7,291	7,291
As of Sep. 30, 2007	14,643	24,345	35,111	10,727	84,826

Segment (in € '000)	Jan. 01 - Sep. 30, 2007	Jan. 01 - Sep. 30, 2006	Change (in %)
Germany
Sales	125,456	111,495	12.5
Earnings before income taxes	8,640	6,301	37.1
Export
Sales	42,293	34,212	23.6
Earnings before income taxes	3,120	2,380	31.1
Full Company
Sales	167,749	145,707	15.1
Earnings before income taxes	11,760	8,681	35.5

Segment report for the first nine months 2007

Notes on the report for the six-month period ended September 30, 2007

1. Accounting principles

Westag & Getalit AG's quarterly report for the period ended June 30, 2007 was compiled in full compliance with the Financial Reporting Standards (IFRS) as valid on the reporting date. All accounting and valuation principles are consistent with those used for the 2006 financial statements.

2. Cash flow statement

The cash flows in the cash flow statement were determined using the indirect method.

3. Liquid funds

Liquid funds shown in the balance sheet include securities in an amount of € 2,993 thousand (Dec. 31, 2006: € 8,991 thousand).

4. Composition of subscribed capital

The subscribed capital of € 14,643,200 is composed of 2,860,000 no-par ordinary shares and 2,860,000 non-voting no-par preference shares with a total value of € 7,321,600.

5. Purchase commitments

As of September 30, 2007, purchase commitments amounted to € 5,594 thousand, compared to € 10,364 thousand in the previous year.

6. Review

The interim financial statements and the interim management report have been neither audited in accordance with section 317 HGB nor reviewed by the auditors.

7. Assurance by the legal representatives

The legal representatives of Westag & Getalit AG assure, to the best of their knowledge, that, in accordance with the applied principles of proper interim reporting, the present interim financial statements provide a true and fair view of the net worth, financial and earnings position of the company, that the interim management report presents a true and fair view of the business results and the situation of the company and that the main risks and opportunities of the expected development of the company during the rest of the fiscal year have been outlined.

Financial schedule*

March 6, 2008	Press Release Report on the results of fiscal year 2007
March 20, 2008	Publication of the Financial Report 2007 (Internet)
April 29, 2008	Annual Financial Statement Press Conference in Düsseldorf
May 13, 2006	Report on the first three months of 2008
August 12, 2008	Annual General Meeting (AGM) of Shareholders in Rheda-Wiedenbrück Press Release Report on the first six months of 2008
August 2008	DVFA Event Analysts' Conference in Frankfurt
November 12, 2008	Report on the first nine months of 2008

* The complete financial calendar is available on the Internet at: www.westag-getalit.de/finanzkalender

Westag & Getalit AG • Postfach 2629 • 33375 Rheda-Wiedenbrück Germany • Tel. + 49 (0) 52 42/17-0 • Fax + 49 (0 ) 52 42/17-7 50 00 www.westag-getalit.de · e-mail: ir@westag-getalit.de