H&R WASAG AG / Half Year Results 14.08.2008 Release of a Corporate News, transmitted by DGAP - a company of EquityStory AG. The issuer is solely responsible for the content of this announcement. --------------------------------------------------------------------------- - Turnover during first half year on a record level of 495.3 million (+22.2 %) - Half year's result of 28.0 million (EBT) documents stable development of the company - Forecast confirmed Salzbergen, 14 August 2008: Under difficult conditions and despite the scheduled downtimes at the sites in Salzbergen and Hamburg-Neuhof, H&R WASAG AG confirms its forecast for the financial year 2008 on the basis of the second quarter. In particular due to increased sales prices resulting from higher crude oil prices, turnover grew to a record value of 266.2 million (second quarter of 2007: 198.1 million). During the first half of 2008, turnover grew by more than 22 per cent to 495.3 million (first half of 2007: 405.4 million). Despite dramatically increased cost prices and despite the fact that sales prices could only be increased with a delay, operating earnings before interest, taxes, depreciation and amortisation (EBITDA) of 18.5 million during the second quarter of 2008 (second quarter of 2007, adjusted for the sale of the Explosives Division: 20.7 million) and earnings before taxes (EBT) of 12.4 million (second quarter of 2007, adjusted: 16.8 million) were within the target corridor for the first half of 2008. Total half year results are also in line with expectations, with earnings before taxes (EBT) of 28.0 million (2007, adjusted: 38.1 million). On this basis, the Executive Board confirms the forecast to achieve a turnover of about one billion euros and earnings before taxes (EBT) for the whole year in the order of magnitude of 50 million to 60 million. 'Also in extremely difficult times, we are well on track,' says Gert Wendroth, Chairman of the Executive Board of H&R WASAG AG. High crude oil price brings new challenges Further increases in crude oil prices during the second quarter, confronted H&R WASAG AG with new challenges. 'Our Sales Department has again done excellent work,' says Wendroth. It succeeded in absorbing the price increases by corresponding increases in prices for the products of H&R WASAG and so setting the base for a more adequate margin situation during the second half of the year. Nevertheless, the result of the quarter was negatively impacted by significantly increased raw material costs since the price increases could only be passed on to customers with a delay due to term contracts. This effect was partially offset by the higher valuation of inventories, also resulting from the increases in raw material prices. In addition, the higher raw material prices led to a clear expansion of working capital (total of inventories and receivables for deliveries and services), which again significantly increased from 204.6 million on 31 March 2008 to 246.7 million at the end of the second quarter. Although this development had basically been anticipated with the new syndicated loan agreed at the beginning of the year, the Executive Board believes it is necessary to review the investment programme, given the fact that the high volatility in the raw material markets is likely to prevail. 'Also in the case of additional unexpected price increases, we would like to have an adequate liquidity buffer for a continuously stable development of turnover and earnings,' emphasises Wendroth. At the same time, the investment sums for the objects planned so far have also increased significantly, as reported at the General Shareholder Meeting. 'We stay on our growth course, but we will review parts of the investments planned with regard to their amount, timing, and configuration. The capacity expansion investments of 'Project 40' currently under way will be implemented as planned,' explains the Chairman of the Executive Board. Plastics Division with decrease in result The development of the Plastics Division was not satisfactory during the second quarter of 2008. Operating earnings (EBITDA) at an amount of 1.0 million (second quarter of 2007: 1.4 million) were below those of the previous year, which had also to be attributed to the slackening economic development of the automotive industry, besides the increases in raw material prices. The current restructuring of the European business and at the Chinese subsidiary, which is 100 per cent owned by H&R WASAG Group since the beginning of April, also led to higher costs. 'These effects of these measures will only show up in the medium-term and then lead to increasing revenues,' announces Wendroth. In the total year 2008, operating earnings (EBITDA) is expected to remain below last years 3.9 million. Conversion of preferential shares into ordinary shares completed The conversion of preferential shares into ordinary shares, based on the resolution adopted by the General Shareholder Meeting on 24 June 2008, was completed. After the registration made on 8 August 2008, the share capital of H&R WASAG AG now consists of a total of 29,973,112 ordinary shares. Detailed information about current developments can be found in the quarterly reports as at June 30, 2008, which will be available on our Internet site under www.hur.wasag.com at 10 a.m. today, for both review and download. Please find attached our summary table with key figures for the 1st half year 2008. Contact: H&R WASAG AG, Investor Relations / Communication, Christian Pokropp Neuenkirchenerstraße 8, 48499 Salzbergen Tel.: +49 (0)40-43218-321, Fax: +49 (0)40-43218-390, Mail: Christian.Pokropp@hur-wasag.de www.hur-wasag.com H&R WASAG AG: The company develops and manufactures specialised crude oil-based chemical-pharmaceutical products and produces precision plastic parts. The group companies are well-positioned as market and/or technology leaders in the respective business fields. Contact: H&R WASAG AG Investor Relations / Public Relations Christian Pokropp Neuenkirchenerstraße 8, 48499 Salzbergen Tel.: 040-43218-321, Fax: 040-43218-390 Mail: Christian.Pokropp@hur-wasag.de www.hur-wasag.com DGAP 14.08.2008 --------------------------------------------------------------------------- Language: English Issuer: H&R WASAG AG Neuenkirchener Str. 8 48499 Salzbergen Deutschland Phone: +49 (0)40 43 218 321 Fax: +49 (0)40 43 218 390 E-mail: investor.relations@hur-wasag.de Internet: www.hur-wasag.de ISIN: DE0007757007 WKN: 775700 Indices: SDAX Listed: Regulierter Markt in Frankfurt (Prime Standard), Hamburg, Düsseldorf; Freiverkehr in Berlin, Hannover, München, Stuttgart End of News DGAP News-Service ---------------------------------------------------------------------------
DGAP-News: H&R WASAG AG: masters difficult economic conditions
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