Loewe AG / Change in Forecast/Change of Personnel
29.07.2010 08:02
Dissemination of an Ad hoc announcement according to § 15 WpHG, transmitted by
DGAP - a company of EquityStory AG.
The issuer is solely responsible for the content of this announcement.
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- New forecast for 2010:
- Continued moderate growth in sales projected
- Negative EBIT for 2010 not ruled out due to higher
procurement costs
- Restructuring started
- Löhrer resigns on own volition
- Seidl assumes chairmanship of Executive Board
Kronach, July 29, 2010 - Sales of the Loewe Group in the second quarter of
2010, at EUR 74.0 million, were 4% higher than the 2009 figure of EUR 71.0
million. In the first six months of 2010, Group sales increased moderately
by 3% from EUR 143.8 million to EUR 147.4 million. While first half sales
in Germany at EUR 84.0 million equaled those of the previous year, export
sales grew by 5% to EUR 63.4 million. Despite this moderate increase in
sales volume, Loewe recorded an EBIT loss of EUR 4.9 million in the second
quarter of 2010 compared to positive EBIT of EUR 0.7 million in the same
period of 2009. For the first six months of 2010, EBIT amounts to a loss of
EUR 4.1 million, down from positive EBIT of EUR 1.4 million in H1 2009.
Price adjustments in the entry level TV segment and higher procurement
costs (especially for the LCD panels highly in demand), enabled Loewe to
achieve a gross margin of 22.9% in the first six months of 2010. This
amount is accordingly 4.8 percentage points lower than the high level of
27.7% in the 2009 period. Furthermore, problems with suppliers prevented
Loewe from launching the new Individual TV family in the key European
markets until the FIFA World Cup had already started.
Generally, the business associated with the FIFA World Cup in South Africa
fell short of Loewe's expectations. The departing Loewe CEO, Frieder C.
Löhrer, has accepted responsibility for the current business development
and requested the Supervisory Board to accept his resignation with
immediate effect. Loewe is responding to the changed market and framework
conditions with a restructuring program that has already been initiated in
cooperation with an external partner in order to make the company more
efficient for the future. Chief Financial Officer Oliver Seidl will assume
responsibility for the complete restructuring as CEO and will provisionally
be responsible for marketing and sales.
A purchasing offensive will result in improvements in earnings in the short
term through a review of purchasing conditions. For the medium and long
term, Loewe will use increased bundling of volume to key suppliers, the
systematic use of platform concepts and improved utilization of potentials
in Asian procurement markets to reduce cost of materials on the procurement
side on a sustained basis. Furthermore, the central divisions of
development, marketing and sales are currently being restructured to ensure
more rapid availability of the products in the market and more effective
marketing of products. Generally, increased cost discipline is a priority
for Loewe across all divisions. All investments not having product,
distribution or brand relevance will come under scrutiny.
Loewe will intensify the LED product offensive already started by launching
the Individual 55 and 32 inch LCD TVs and two TV product lines with the
most advanced LED backlighting in the second half of 2010. Loewe will
present 3D-capable televisions and the first BluRay player for 3D
television at the most important trade show, IFA 2010. These two products
will then be launched on the market in the first quarter of 2011. Loewe
will also present user friendly solutions for connecting televisions to the
Internet based on the new HbbTV standard at the IFA.
The possibility of sustained weakness of the euro could also result in
future risks arising from the purchasing volume for flat panel displays,
which are for the most part settled in U.S. dollars. Accordingly, an
appreciation of the U.S. dollar in relation to the euro will lead to higher
procurement costs. Hedging instruments are used to hedge a defined
purchasing volume on a rolling basis for a period of about 18 months. From
the present perspective, however, it cannot be ruled out that the weakness
of the euro will have a negative impact on the gross margin in the future.
Loewe continues to expect sales to grow moderately in the current fiscal
year 2010. Despite the positive stimuli expected from the International
Consumer Electronics Fair in Berlin, the launch of new, innovative home
entertainment solutions and the early initiation of the restructuring
program, it is impossible to rule out negative EBIT for 2010 as a whole
from the present perspective. This primarily results from currency and
procurement risks. Loewe anticipates slight sales growth and a positive
earnings trend for fiscal 2011. The company's sound capital structure and
multiyear financing agreements make it well positioned for the future.
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Information and Explaination of the Issuer to this News:
ATTENTION PLEASE: In this connection Loewe is announcing a conference call
with Mr. Oliver Seidl, CEO, TODAY at 10:00h a.m. local time. Please
register for this call by phone at +49 9261 99-984 or by mail to
ir@loewe.de to receive the dial in details.
Loewe AG
Industriestrasse 11
96317 Kronach, Germany
Investor Relations, Axel Gentzsch
phone: +49 9261 99-240
fax: +49 9261 99-994
mail: axel.gentzsch@loewe.de
Public Relations, Dr. Roland Raithel
phone: +49 9261 99-217
fax: +49 9261 99-444
mail: roland.raithel@loewe.de
29.07.2010 08:02 Ad hoc announcement, Financial News and Press Release distributed by DGAP. Medienarchiv at |[![CDATA[|[a href="http://www.dgap-medientreff.de"|]www.dgap-medientreff.de|[/a|]]]|] and |[![CDATA[|[a href="http://www.dgap.de"|]www.dgap.de|[/a|]]]|]
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Language: English
Company: Loewe AG
Industriestrasse 11
96317 Kronach
Deutschland
Phone: +49 (0)9261 99-984
Fax: +49 (0)9261 99-994
E-mail: ir@loewe.de
Internet: www.loewe.de
ISIN: DE0006494107
WKN: 649410
Indices: SDAX
Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr
in Berlin, Düsseldorf, München, Hamburg, Stuttgart
End of News DGAP News-Service
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DGAP-Adhoc: Loewe AG: Half-year figures for 2010 / Changes in the Executive Board
| Source: EQS Group AG