Westag AG — Interim / Quarterly Report 2011

Nov 14, 2011

Quarterly Report

1st to 3rd Quarter 2011

Interim Report on the first nine months 0f 2011

Sales

Westag & Getalit AG benefited from the positive trend in the German construction sector in 2011 and increased its sales revenues in the first nine months of the current financial year by 7.4 % to € 173.0 million (previous year: € 161.2 million).

It was good to see that, in spite of the difficult export environment, our export sales increased at a disproportionate rate of 17.6 % to € 37.9 million (previous year: € 32.2 million). As a result, the export share rose markedly from 20 % to 21.9 %.

Divisions

Sales revenue in € '000	Jan. 1 - Sep. 30, 2011	Jan. 1 - Sep. 30, 2010	Change in %
Plywood/Formwork	28,130	25,424	10.6
Doors/Frames	82,264	75,756	8.6
Laminates/Elements	57,325	55,608	3.1

The Plywood/Formwork Division benefited from increased demand in Germany and abroad and boosted its sales revenues by 10.6 % to € 28.1 million.

The Doors/Frames Division was also able to increase its sales revenues thanks to very robust domestic and international demand. At € 82.3 million, sales revenues were up by 8.6 % on the previous year.

Our Laminates/Elements Division reported moderate sales growth of 3.1 % to € 57.3 million. With the domestic business remaining stable, the increase was mainly driven by exports.

Earnings

Profit data in € '000	Jan. 1 - Sep. 30, 2011	Jan. 1 - Sep. 30, 2010	Change in %
Earnings before income taxes	8,935	9,193	- 2.8
Net Profit	6,255	6,435	- 2.8
Earnings per share (in €)	1.15	1.17	- 1.7

At € 8.9 million, nine-month earnings before income taxes were slightly below the prior year level (€ 9.2 million). On the one hand, the sharp increase in sales revenues had a positive influence on the result, but on the other hand, higher material costs had an adverse impact on the bottom line. While this impact was partly offset by cost savings and higher sales prices, the sharp rise in costs particularly for wood-based materials made it impossible to fully offset the negative effects at least for the time being.

Due to the decline in earnings before taxes, net profit for the nine-month period also decreased moderately and amounted to € 6.3 million (previous year € 6.4 million). Nine-month earnings per share stood at € 1.15 (previous year: € 1.17).

Capital expenditure

Capital spending in 2011 will be more or less on a par with the previous year's level of approx. € 10 million. The single most important investment is a production line for the more efficient edge treatment of our standard doors.

Workforce	Sep. 30,	Sep. 30,	Change
	2011	2010	in %
Number of staff	1,275	1,238	3.0

Employees

Our headcount was up slightly by 3.6 % to 1,261 during the first half year (previous year: 1,217), meaning that headcount growth was disproportionately smaller than the increase in sales.

Portfolio of own shares

As of September 30, 2011, Westag & Getalit AG held 307,336 own shares, all of which were preference shares. This means that the number of own shares increased by 22,529 shares as compared to December 31, 2010 in the context of the stock repurchase programme.

Outlook

Compared to our latest report on the first six months of 2011, the economic outlook has become much bleaker. In the summer, we still spoke of a robust upswing but now the close integration between the German economy and the crisis-hit rest of Europe is becoming increasingly visible. While the latest figures for the domestic economy are still good, the outlook is clearly dominated by the debt and currency crisis.

We are optimistic that the positive sales trend will continue for the rest of the year and that we again will achieve good growth for the full year, but we share the general uncertainty about the future trend in 2012.

Our bottom line continues to be influenced by the lower margin, which results from the higher commodities prices. So far, we have not yet sufficiently offset the high price growth through higher sales prices for our products. A further increase in the prices of our products will therefore be inevitable.

Our strengths in terms of product range, sales power, employees and cost awareness make us confident that we will continue to be able to generate good results

Rheda-Wiedenbrück, November 2011 Westag & Getalit AG The Management Board

Balance sheet

Assets in € '000	Sep. 30, 2011	Dec. 31, 2010
Intangible assets	663	663
Tangible assets	62,351	61,981
Financial assets	1,203	1,263
Deferred tax liabilities	0	0
Non-current assets	64,217	63,907
Inventories	39,418	33,944
Receivables and other assets	38,627	31,565
Cash at banks or in hand	7,328	20,176
Current assets	85,373	85,685
Total assets	149,590	149,592

Equity and liabilities in € '000	Jun. 30, 2011	Dec. 31, 2010
Subscribed Capital	14,644	14,644
Capital reserve	24,398	24,376
Revenue reserves	54,311	54,311
Accumulated profit	11,433	10,817
Equity and reserves	104,786	104,148
Pension provisions	14,329	14,130
Other non-current provisions	1,582	1,563
Deferred tax liabilities	604	642
Non-current liabilities	16,515	16,335
Trade payables	11,050	11,408
Other current liabilities	16,465	17,135
Current provisions	774	566
Current liabilities	28,289	29,109
Total equity and liabilities	149,590	149,592

Income statement on a quarterly basis

in € '000	Jul. 1 - Sep. 30, 2011	Jul. 1 - Sep. 30, 2010
Sales	61,447	57,989
In/decrease in inventories	- 651	- 142
Own work capitalised	42	53
Total operating performance	60,838	57,900
Other operating income	604	372
Cost of materials	31,054	29,072
Personnel expenses	17,225	16,586
Depreciation and amortisation	2,255	2,365
Other operating expenses	7,036	6,078
Other taxes	56	53
Operating result	3,816	4,118
Financial result	17	43
Extraordinary items	0	0
Earnings before income taxes	3,833	4,161
Income taxes	1,149	1,248
Net profit	2,684	2,913
Earnings per share (undiluted and diluted)	0.49	0.53
Number of shares (undiluted and diluted)	5,422,790	5,449,987

Income statement on nine-months basis

(in € '000)	Jan. 1- Sep. 30, 2011	Jan. 1- Sep. 30, 2010
Sales	173,037	161,192
In/decrease in inventories	2,252	1,878
Own work capitalised	61	184
Total operating performance	175,350	163,253
Other operating income	1,908	1,388
Cost of materials	90,097	80,697
Personnel expenses	51,018	49,586
Depreciation and amortisation	6,975	7,215
Other operating expenses	20,171	18,058
Other taxes	189	145
Operating result	8,808	8,941
Financial result	127	252
Extraordinary items	0	0
Earnings before income taxes	8,935	9,193
Income taxes	2,680	2,758
Net profit	6,255	6,435
Earnings per share (undiluted and diluted)	1.15	1.17
Number of shares (undiluted and diluted)	5,427,088	5,478,709

Cash flow statement

in € '000	Jan. 1- Sep. 30, 2011	Jan. 1- Sep. 30, 2010
Operating result/EBIT	8,808	8,941
Income tax payments	- 3,152	- 5,099
Depreciation and amortisation	6,975	7,215
Result from asset retirements	- 79	- 79
Change in current assets	- 12,289	- 10,042
Change in liabilities	- 70	9,331
Cash flow from operating activities	193	10,267
Investments in fixed assets	- 7,377	- 6,446
Change in financial assets	60	112
Income from fixed asset retirements	109	188
Cash flow from investment activities	- 7,208	- 6,146
Interest income	127	238
Interest expenses	0	0
Repayment of non-current financial liabilities	0	0
Acquisition/sale of own shares	- 699	- 1,719
Dividend payments	- 5,261	- 5,283
Cash flow from financing activities	- 5,833	- 6,764
Change in liquid funds	- 12,848	- 2,643
Cash and cash equivalents as of Jan. 1	20,176	19,594
Cash and cash equivalents as of Sep. 30	7,328	16,951

in € '000	Subscribed capital	Capital reserve	Revenue reserve	ted profit mula Accu	Total
As of Jan. 1, 2010	14,644	24,376	49,011	12,635	100,666
Transfer to other reserve					0
wn shares Change in o				- 1,719	- 1,719
Addition in accordance with Sect. § 58 II AktG					0
Dividend				- 5,283	- 5,283
Net profit				6,435	6,435
As of Sep. 30, 2010	14,644	24,376	49,011	12,068	100,099
As of Jan. 1, 2011	14,644	24,376	54,311	10,817	104,148
Transfer to other reserve		22			22
wn shares Change in o				- 378	- 378
Addition in accordance with Sect. § 58 II AktG					0
Dividend				- 5,261	- 5,261
Net profit				6,255	6,255
As of Sep. 30, 2011	14,644	24,398	54,311	11,433	104,786

Statement of changes in equity

Segment report for the first nine months 2011

in € '000	Jan, 1- Sep, 30, 2011	Jan, 1- Sep, 30, 2010	Change in %
Germany
Sales	135,056	128,973	4.7
Earnings before income taxes	6,989	7,503	- 6.9
Export
Sales	37,981	32,219	17.6
Earnings before income taxes	1,946	1,690	15.1
Full Company
Earnings	173,037	161,192	7.4
Earnings before income taxes	8,935	9,193	- 2.8

Notes on the report for the nine-month period ended September 30, 2011

1. Accounting principles

Westag & Getalit AG's quarterly report for the period ended June 30, 2011 was, except for IFRS 8 "Operating Segments", 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 2010 financial statements. The waiver of applying IFRS 8 was conducted in order to prevent our company from expected business harm. As regards further reasoning, we refer to our Annual Report 2010.

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 doesn't include securities.

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.

1. Purchase commitments

As of September 30, 2011, purchase commitments amounted to € 4,931 thousand, compared to € 1,882 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.

1. Responsibility statement

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 CALENDAR*

March 22, 2012	Press Release
	Report on the results
	of the fiscal year 2011
March 29, 2012	Publication of Financial Report 2011
	(on the Internet)
April 27, 2012	Annual Financial Statements Press Conference
May 14, 2012	Report on the first three months of 2012
August 13, 2012	Interim report on the first six months of 2012
August 28, 2012	Annual General Meeting
	in Rheda-Wiedenbrück
August 29, 2012	Presentation of Westag & Getalit AG
	at the Small Cap Conference
	in Frankfurt/Main
November 14, 2012	Report on the first nine months of 2012

* For updates refer to: www.westag-getalit.de/finanzkalender

Westag & Getalit AG

Postfach 26 29 | 33375 Rheda-Wiedenbrück | Germany Tel. +49 5242 17-0 | Fax +49 5242 17-75000 www.westag-getalit.de | ir@westag-getalit.de