BERU AG / Final Results
02.04.2009
Release of a Corporate News, transmitted by DGAP - a company of EquityStory AG.
The issuer is solely responsible for the content of this announcement.
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BERU AG: Revenue decline in 2008 due to crisis - no recovery anticipated in
2009
(Ludwigsburg, April 2, 2009) The BERU Group, Ludwigsburg, posted
consolidated revenue of EUR 409.4 million in 2008 (2007: EUR 439.9 million)
and thus achieved the updated forecast given in the last interim press
release. The decline in revenue compared with the prior year was caused by
the slump in unit sales in the automobile industry in the second half of
the year. The result of ordinary activities (EBIT) was negatively affected
by one-time special items, in particular by the transfer of the French
companies to BorgWarner, and amounted to a loss of EUR 26.0 million. The
net loss amounted to EUR 28.4 million. Adjusted for all special items, BERU
achieved a profit from ordinary activities of EUR 21.0 million, equivalent
to an adjusted margin of 5.1%. Earnings per share amounted to minus EUR
2.95 (EUR +2.98).
Dr. Thomas Waldhier, Chairman of the Executive Board of BERU AG, stated on
the past financial year: 'BERU made a good start to the year 2008, but the
second half was impacted by exceptional conditions. Due to the economic
crisis, we were unable to achieve our original targets. But BERU's business
operations are well positioned, due also to the efficiency-enhancing
program that we started just over a year ago.'
Electronics and Sensors close to prior-year level
BERU's Electronics and Sensors division posted revenue of EUR 144.3 million
(EUR 146.9 million), of which the tire-pressure monitoring system
contributed EUR 65.0 million. Demand for PTC auxiliary heating systems
developed positively: BERU increased the revenue generated by this product
from EUR 21.8 million to EUR 26.4 million.
Diesel Cold Start Technology defends its strong market position
The revenue of the Diesel Cold Start Technology division decreased from EUR
164.1 million to EUR 143.0 million. This was due not only to the economic
crisis, but also to the disproportionately high fall in new registrations
of diesel automobiles. Nonetheless, BERU is still the world's market leader
in this field. The pressure sensor glow plug, which successfully went into
series production in 2008, should lead to a revival of this division in the
coming years.
Ignition Technology develops better than the market as a whole
Overall, Ignition Technology was unable to avoid the general trend, but
thanks to higher unit sales of ignition coils, the division's fall in
revenue was more moderate than that of the market as a whole. Revenue
amounted to EUR 122.2 million, compared with EUR 128.9 million in 2007.
Aftermarket slightly positive - decline for General Industry
In the Aftermarket sales segment, BERU's worldwide spare-parts business,
the Group recorded slight revenue growth of 0.7% to EUR 118.4 million. This
was mainly achieved through increased unit sales of ignition coils.
The revenue posted by the General Industry segment decreased to EUR 25.6
million in 2008 (EUR 27.2 million).
Due to the economic crisis, revenue in the Original Equipment segment fell
to EUR 265.4 million, compared with EUR 295.1 million in 2007.
Regional revenue development
In regional terms, BERU recorded its biggest slump in revenue of minus
37.9% in the North American market, where the United States has been
particularly hard hit by the automotive crisis. BERU's revenue fell from
EUR 35.5 million to EUR 22.0 million. In Germany, the main market, BERU
maintained its strong position, although revenue decreased to EUR 150.2
million (EUR 154.1 million).
Earnings impacted by special items
BERU achieved an adjusted operating profit before special items of EUR 21.0
million in 2008. Unadjusted EBIT amounted to minus EUR 26.0 million,
including negative special items of EUR 47.0 million, primarily from the
transfer of the French companies to BorgWarner and from restructuring
actions.
Investing in the future - increased R&D spending
BERU invested EUR 29.5 million last year, mainly in new equipment for
innovative new products. Adjusted for capitalized development costs, 83.6%
of this investment was at the sites in Germany. The Group's research and
development expenses totaled EUR 19.8 million in 2008 (before
capitalization of development costs), which is EUR 2.4 million more than in
the prior year and represents an R&D ratio of 4.8% in relation to revenue
(4.0%). Dr. Waldhier: 'Innovative products secure BERU's future
competitiveness. We therefore continue to invest in these projects also in
difficult times.'
Solid balance sheet structures - cash flow positive
Despite the difficult situation in the market environment and the disposal
of the French companies, BERU presented a sound balance sheet structure at
December 31, 2008, as in previous years. Due to the net loss, equity before
minority interests decreased by EUR 22.8 million to EUR 337.2 million. The
equity ratio is therefore unchanged compared with the prior year at the
high level of 73.0%.
The Group's cash flow (net profit/loss less depreciation and amortization
and changes in long-term provisions) amounted to EUR 42.9 million (EUR 61.6
million). All payments for investments and of the dividend were thus
financed out of the cash flow.
Workforce
At the end of the year 2008, the BERU Group employed 1,953 people around
the world (2007: 2,560). The decrease in the size of the workforce is
mainly the result of the disposal of the French companies as well as the
efficiency-enhancing program. 502 persons were employed outside Germany
(2007: 1,053) and 1,451 persons were employed in Germany (2007: 1,507).
Continuation of efficiency-enhancing program
In the context of optimizing the Group's worldwide plant network,
production in Italy, Mexico and South Korea was discontinued, and the plant
in Hungary is expected to be closed this year. Those plants' production
volumes will be transferred to other plants so that their capacities are
utilized more efficiently.
Effects of the economic crisis
In order to counteract the sales crisis in the automotive industry, BERU
already initiated various actions in October 2008. As the market situation
had still not improved at the beginning of 2009, additional short-time work
has meanwhile been introduced at several locations and further measures for
cost reduction have been taken.
Outlook
Forecasts of economic developments are currently connected with a high
degree of uncertainty, but the BERU Executive Board assumes that worldwide
demand for automobiles in 2009 will be significantly lower than in 2008.
'We do not anticipate an economic recovery in 2009,' emphasized Dr.
Waldhier. 'According to current projections, our revenue will fall to a
level of between EUR 300 million and EUR 310 million in 2009.' In this
context, it is important to realize that due to the change in the
consolidated group following the sale of the French companies, a comparison
with the prior year is not directly possible (effect approx. EUR 30
million). Operating profit in relation to revenue is expected to fall
accordingly.
Annual Report
BERU AG published its Annual Report 2008 on April 2, 2009 and made it
accessible to shareholders on the company's website at
www.beru.com/annual_report.
BERU's business development in 2008
Consolidated income statement*<pre>
EUR million 2008 2007
Revenue 409.4 439.9
Gross margin 98.5 114.1
Selling expenses 26.9 26.2
Administrative expenses 34.0 32.8
Research and development spending** 19.6 13.4
Other operating expenses 44.0 2.6
Profit on ordinary activities (EBIT) -26.0 39.1
Financial income 5.0 5.2
Earnings before taxes -21.0 44.3
Income taxes -7.4 -13.4
Net profit/loss -28.4 30.9</pre>
Consolidated balance sheet <pre>
EUR million 31.12.2008 31.12.2007
Assets
Non-current assets 168.9 210.6
Current assets 287.9 282.6
Equity and liabilities
Equity*** 340.8 363.4
Non-current liabilities 37.7 39.6
Current liabilities 82.4 90.2</pre>
* Changeover of income statement from total-cost method to cost-of-sales
method
** after capitalization of development costs
*** Including minority interests in equity
DGAP 02.04.2009
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Language: English
Issuer: BERU AG
Mörikestr. 155
71636 Ludwigsburg
Deutschland
Phone: +49 (0)7141 132-931
Fax: +49 (0)7141 132-586
E-mail: investor-relations@beru.de
Internet: www.beru.de
ISIN: DE0005072102
WKN: 507210
Listed: Regulierter Markt in Frankfurt (General Standard), Stuttgart;
Freiverkehr in Berlin, München, Hamburg, Düsseldorf
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