BERU AG / Release of an announcement according to Article 37x of the WpHG [the German Securities Trading Act]
13.11.2008
Interim report according to Article 37x of the WpHG
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BERU AG presents its figures for the nine-month period of 2008
(Ludwigsburg, November 13, 2008) The BERU Group, Ludwigsburg, posted
revenue of EUR 324.2 million in the first nine months of 2008 (9M 2007: EUR
331.5 million). Profit from ordinary activities (EBIT) amounted to EUR 18.8
million (EUR 34.2 million), equivalent to an EBIT margin of 5.8% (10.3%).
This includes one-time special items, which reduced EBIT by approximately
EUR 9.8 million. Excluding those special items, adjusted EBIT amounted to
EUR 28.6 million, equivalent to an adjusted margin of 8.8%.
Developments in the sales segments
The Aftermarket business continued its positive development in the first
nine months of 2008 and generated revenue of EUR 89.1 million, representing
growth of 4.1% compared with the prior-year period (EUR 85.6 million).
In the area of Original Equipment, however, there was a significant impact
from the financial crisis and automobile manufacturers' resulting
production cuts. BERU posted significantly lower revenue in this segment in
the third quarter. The drop in revenue was also the result of pressure on
prices and an intensely competitive situation. Revenue in the first nine
months of the year thus decreased to EUR 215.3 million (EUR 226.9 million).
Already now another reduction seems likely in the fourth quarter.
The General Industry segment achieved nine-month revenue of EUR 19.8
million (EUR 19.0 million).
Developments in the product divisions
The revenue generated by the Electronics and Sensors division remained
stable at EUR 112.0 million (EUR 112.0 million). This was primarily due to
strong demand for PTC auxiliary heating systems. Revenue decreased in the
Diesel Cold Start Technology and Ignition Technology divisions. Diesel Cold
Start Technology posted revenue of EUR 115.5 million (EUR 121.2 million),
which was 4.7% less than in the prior-year period. At the Ignition
Technology division, revenue decreased by 1.6% from EUR 98.3 million to EUR
96.7 million.
Continuation of efficiency-enhancing program
In the context of the efficiency-enhancing program for the improvement of
competitiveness that was initiated in December 2007, a further need for the
optimization of internal processes has been identified. This will entail
the reduction of approximately 60 jobs, mainly in administrative
departments in Germany.
Effects of the financial market crisis
Due to the worsening financial market crisis and the resulting sales crisis
in the automobile industry, BERU has decided to take various measures to
counteract the declining production volumes. These measures include an
extended plant shut down over the Christmas holiday, the reduction of
vacation and of hours accumulated on flexitime accounts by the end of the
year, and reduced weekly working times for all employees as of January
2009. These measures will at first be in force until the end of March 2009.
Synergies from the domination and profit transfer agreement
In order to utilize synergies in connection with the domination and profit
transfer agreement with BorgWarner Germany GmbH, BERU has decided to
integrate its French companies into the French organizational structure of
BorgWarner by the end of 2008. The companies BERU TdA SAS and Eyquem SNC
will be merged, amalgamated with the French BorgWarner companies and given
a new formal structure. They will then operate under the name 'BorgWarner
France SAS.' The afore mentioned BERU entities will continue to be managed
by the BERU within the BorgWarner Engine segment.
Outlook
The BERU Executive Board does not expect the sales crisis in the automobile
industry to improve in the short term. 'The situation in the automobile
industry has exacerbated dramatically,' stated Dr. Thomas Waldhier,
Chairman of the Executive Board of BERU AG. 'We will therefore not achieve
our previous forecasts for revenue and earnings in full-year 2008,
andanticipate weak demand also in the year 2009.' Furthermore, the formal
restructuring of the French companies and the changes in the consolidated
Group will cause negative special items with an impact of between EUR 40
million and EUR 50 million on earnings in 2008. BERU now anticipates
revenue in full-year 2008 of between EUR 405 million and EUR 415 million,
and EBIT adjusted for special items of between EUR 30 million and EUR 35
million. However, Waldhier believes that with the actions that have been
decided upon, BERU is well placed to react flexibly to future developments:
'As soon as the order situation improves, we will be able to increase our
production again. In addition, BERU has well positioned business operations
and a strong and healthy financial base.'
BERU business developments in the first nine months of 2008
(January 1 - September 30, 2008)
Based on unaudited figures <pre>
EUR million 9M 2008 9M 2007
Revenue 324.2 331.5
Profit on ordinary activities (EBIT) 18.8 34.2
Capital expenditure 10.0 17.7
Net financial position* 135.8 100.2
Revenue by region
Germany 117.0 118.2
Europe (excluding Germany) 145.4 136.9
North America 17.5 28.4
Asia 31.4 35.5
Rest of the world 12.9 12.4
Revenue by sales segment
Original Equipment 215.3 226.9
Aftermarket 89.1 85.6
General Industry 19.8 19.0
Revenue by product division
Diesel Cold Start Technology 115.5 121.2
Ignition Technology 96.7 98.3
Electronics and Sensors 112.0 112.0
Number of employees** 2,378 2,593</pre>
*Incl. a loan to BorgWarner Germany GmbH
**At September 30
DGAP 13.11.2008
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Language: English
Issuer: BERU AG
Mörikestr. 155
71636 Ludwigsburg
Deutschland
Internet: www.beru.de
End of News DGAP News-Service
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DGAP-IRE: BERU AG: BERU AG presents its figures for the nine-month period of 2008
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