Wolford AG — Earnings Release 2006

Mar 15, 2006

News Details

Ad-hoc | 15 March 2006 08:30

Wolford AG: Earnings for the first three quarters of the 2005/06 fiscal year

Ad hoc announcement transmitted by DGAP – a company of EquityStory AG. The issuer is solely responsible for the content of this announcement. —————————————————————————— WOLFORD CONTINUES TO PUSH UP EARNINGS IN THIRD QUARTER · EBIT boosted by 30.0 percent, EBT by 39.6 percent · Net profit for the quarter more than doubled to EUR 2.7 million · Sales expanded 2.7 percent to EUR 92.9 million Bregenz, Austria, March 15, 2006 Earnings data for first three quarters of 2005/06 (May 1, 2005 to January 31, 2006) Amounts in millions of euros First three quarters of Change in % except for per-share data 2005/06 2004/05 Sales 92.88 90.48 +2.7 EBITDA 8.56 7.97 +7.4 EBITDA margin 9.2% 8.8% – EBIT 4.20 3.23 +30.0 EBIT margin 4.5% 3.6% – Financial result -1.03 -0.96 -7.3 EBT 3.17 2.27 +39.6 Net profit for the period 2.66 1.09 +144.0 Earnings per share in euros 0.56 0.23 +143.5 Gearing 30.0% 33.0% – Equity ratio (% of total assets) 49.7% 49.1% – The positive momentum for Austria’s number one luxury fashion brand continues and is slightly increasing. As already reported, sales revenues in the first three quarters of the current fiscal year (May 1, 2005 to January 31, 2006) grew 2.7 percent to EUR 92.9 million. As in the first half of the year, profit figures rose disproportionately more than sales over the first nine-month period. Thanks to successful cost management and despite higher marketing costs, earnings of the publicly traded company expanded significantly. While EBITDA for the first three quarters was lifted 7.4 percent from the year-earlier level to EUR 8.6 million, EBIT increased 30.0 percent to EUR 4.2 million. EBT, or profit before tax, was EUR 3.2 million (2004/05: EUR 2.3 million), up 39.6 percent. “The new store concept and new advertising campaign, the updated and attractive product portfolio as well as internal efficiency gains all contributed to this good interim profit”, commented Wolford AG’s pleased CEO, Holger Dahmen. “The numbers demonstrate that we are on track”. Management’s prediction at the last annual press conference that sales growth would translate into disproportionately more rapid growth in profits was borne out especially by the trend in this fiscal year’s interim net income to date: The cumulative net profit for the first three quarters more than doubled year-over-year from EUR 1.1 million to EUR 2.7 million. Earnings per share for the first nine months of the fiscal year increased from EUR 0.23 to EUR 0.56. Debt reduction continues apace at Wolford. The decrease of EUR 4.5 million in bank loans and overdrafts during the reporting period led to a corresponding improvement in net debt. As a consequence, the debt-equity gearing fell from 33.0 percent to the long-term target of 30.0 percent. The company’s equity base meanwhile remains consistently solid. Thus, the equity ratio rose somewhat further in the reporting period, to 49.7 percent. Sales The trend in business with the partner-operated boutiques and at Wolford’s own boutiques is broadly positive. In this distribution channel, growth for the first three quarters of the fiscal year was 12.7 percent, bringing boutiques’ share of total sales to more than 40 percent as of the end of January 2006. In the Retail segment as a whole, which represents all direct sales (Wolford-owned boutiques, shop-in-shops and factory outlets), the company achieved a revenue expansion of 21.8 percent that was attributable to every channel in the segment. Wolford attained continuing double-digit growth compared to the prior-year period (May to the end of January) in Spain (up 35 percent), the Eastern European countries (17 percent) and Scandinavia (11 percent). The positive trend in Germany, the largest market, persisted with growth of 4 percent. Similarly, sales increased in Austria (by 3 percent), Switzerland (6 percent), the Netherlands (6 percent) and Italy (5 percent). Decreases were seen in the United Kingdom, the United States and France. It should be emphasized, however, that in all three of these latter markets the Wolford boutiques posted sales growth, and that total sales both in the U.S. and U.K. already rose again in the third quarter. Sales in the multibrand channel did not keep pace with the general upturn. Revenues from department stores were marginally lower than a year ago. Meanwhile, there was growth in the private-label business, which expanded by about one-quarter in the first nine months of 2005/06. The recent announcement of the new designer collaborations with French luxury label Kenzo and young U.S. star designer Zac Posen has elicited extremely positive reactions from the fashion community and retailers. Both partnerships will debut with the fall/winter 2006/07 season. Following the creative joining of forces with Missoni – the collection for the current spring/summer 2006 season is already available in stores – Wolford has thus attracted additional designer talent of great international renown. Outlook The Executive Board expects the positive course of business to continue. The targets for the fiscal year to the end of April 2006 remain an increase in sales to at least EUR 120 million and an accompanying improvement in profitability at a rate exceeding the pace of sales growth. The full consolidated balance sheet and income statement are available on the Internet at www.wolford.com. Contacts: Holger Dahmen, Chief Executive Officer Peter Simma, Chief Financial Officer investor@wolford.com, www.wolford.com Wolford AG, Wolfordstraße 1, A-6901 Bregenz, Austria Tel.:+43 (0) 5574/690 0 (c)DGAP 15.03.2006 ————————————————————————— language: English emitter: Wolford AG Wolfordstraße 1 6901 Bregenz Österreich phone: +43/5574/6907434 fax: +43/5574/6907440 email: investor@wolford.com WWW: www.wolford.com ISIN: AT0000834007 WKN: 83400 indexes: ATX stockmarkets: Amtlicher Markt in Wiener Börse; Freiverkehr in Berlin-Bremen, Stuttgart, München; Open Market in Frankfurt End of News DGAP News-Service —————————————————————————