Generating more added value internally and increasing Feintool's cash flow are the priorities of both the Board of Directors and Group Management. The technology and systems business is being consolidated and the group is strengthening its market leadership. The component business is geared to growth. The Automation Division will remain part of Feintool and, in optimized form and with simplified structures, will be part of the Group's core business. All branches in the United States have been amalgamated under the management control of the Feintool America Division.
The convertible bond issue that is due to expire in 2005 is to be replaced by a new convertible bond. In connection with this, an Extraordinary General Meeting will be held on 16 March 2004 to vote on an increase in conditional capital. The Group's financial reporting will be changed over from ARR to IFRS in the course of the current financial year. The semiannual report will comply with the new standards for the first time and will include comparable year-back figures.
First-quarter sales target achieved, order intake higher
In the technology and systems business, press sales by the Fineblanking Technology Division still failed to regain the levels of former years. By contrast, the Automation Division benefited from the stability of the automotive industry as well as the upturn in telecommunications, where production of mobile phones in particular started to pick up. This trend continued throughout January.
The components business, which supplies globally operating customers, continues to perform well. In the System Parts division, the production facilities in Europe, the United States and Japan increased their sales once again. The same is true of the Plastic/Metal Components Division, which has plants in Switzerland and the United States.
Strengthening of the technology and systems business, growth in the components business
Feintool aims to further increase its technology leadership in its traditional core business of fineblanking and forming as well as in the automation sector. To achieve this goal, the core competencies of the Fineblanking Technology and Automation Divisions are being strengthened and their operating structures are being simplified. The company is endeavouring to generate internal growth in its components business. These efforts encompass the System Parts and Plastic/Metal Components Divisions and the Europe, America and Asia regions.
The Board of Directors has decided that the Automation Division should remain within Feintool and be part of the Group's core business. Its structure, organization and brand portfolio will be slimmed down and optimized. Apart from the systems business unit, the companies that have been jointly operating in the automation components sector under the name of United Components will be divided into two business units operating under the already familiar names of Afag (automation handling and feed systems) and Baltec (fastening systems).
As already announced, US activities will be amalgamated into the Feintool America Division, which will be headed by Ralph Hardt, as of 1 March 2004. All branches in White Plains, Cincinnati, Tennessee, Canonsburg and Sommerset will report directly to him.
Current convertible bond issue to be refinanced by new bond
Feintool International Holding's convertible bond issue of CHF 62.5 million, which is due to expire in February 2005 and from which bonds worth CHF 10 million have already been bought back, is to be replaced by the issue of a new convertible bond. An Extraordinary General Meeting of Shareholders, to be held on 16 March 2004, will vote on an increase in the conditional capital. A bank consortium has agreed to issue the convertible bond.
Financial reporting to be converted to IFRS in current financial year
Owing to the ongoing tasks relating to the changeover, it is not possible at this time to present a definitive set of financial statements as at 30 September 2003 in accordance with IFRS.
In addition to adopting the new IFRS accounting and measurement rules, the Feintool Group has also analysed and redefined its own internal accounting and measurement rules. This applies particularly to intangible fixed assets such as capitalized R&D costs and the costs of software and IT projects, tangible fixed assets and inventories.
In a sale and lease-back transaction that took effect on 28 September 2001, the Feintool Group sold a substantial part of its real estate to HL Holding AG, a joint venture between Feintool International Holding AG and Hannover HL Leasing GmbH & Co. KG of Munich. A bank consortium led by the Jena branch of Deutsche Bank AG agreed to provide long-term financing for the joint venture. Under the currently valid ARR regulations Feintool International Holding was able to measure its stake in HL Holding AG at equity. Under the current IFRS regulations the transaction does not qualify as a sale because the significant risks and opportunities remain with Feintool. As a consequence HL Holding AG has to be fully consolidated.
These changes will, in their totality, increase the Feintool Group's balance sheet total as at 30 September 2003 by around CHF 85 million and decrease its equity by around CHF 17 million. As a main result of the consolidation of HL Holding AG, net debt will increase by around CHF 75 million. At approx. CHF 1 million, the negative impact on the income statement for 2002-2003 is minimal.
The forthcoming semiannual report, which is due to be published in May 2004, will comply with the new standards for the first time and will include appropriate year-back figures.
Based in Lyss, Switzerland, Feintool is a leading technology and systems provider in fineblanking/forming and assembly/automation as well as a global supplier of metal and plastic components.
Feintool's 1700 employees - working at its own facilities and branch operations in Switzerland (where 900 staff are based), Germany, France, Italy, Great Britain, the United States, Japan and China - are committed to customer satisfaction.
For further information, please contact:
Reto Hartmann, CEO and Reto Welte, CFO
Phone +41 (0)32 387 51 11, fax +41 (0)32 387 57 81
The Media Release can be downloaded from the following link:
