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Interim disclosure pursuant to Section 37x of the German Securities Trading Act (WpHG)
Weak aftermarket business due to weather conditions In an increasingly difficult market environment, pressure on prices and margins rose in the first quarter, combined with high raw-material and energy prices. The strong euro also led to reduced competitiveness. At the same time, sales revenues in the high-margin Aftermarket segment decreased by nearly 6% to EUR 30.9 million in the first quarter, due to the unusually mild winter weather (EUR 32.8 million). Sales revenues in the Original Equipment segment increased by 0.8% to EUR 77.8 million (EUR 77.2 million). In the General Industry segment, which comprises the business with manufacturers of oil and gas burners as well as industrial electronics, BERU achieved revenue growth of 9.3% to EUR 8.1 million in the first quarter (EUR 7.4 million). Growth in Ignition Technology and Electronics and Sensor Technology The Ignition Technology division’s sales revenues increased by 12.5% from EUR 30.5 million to EUR 34.3 million. This was primarily a result of higher unit sales of ignition coils in the Original Equipment segment. The Electronics and Sensor Technology division developed positively: First-quarter sales revenues of EUR 38.8 million represent growth of 16.6% over the prior-year period. The growth driver for this division was the TSS tire-pressure monitoring system. As expected, BERU’s revenues from PTC auxiliary heating systems decreased, although unit sales rose. This was the result of a more cost-effective and inexpensive product solution. Growth in the Electronics and Sensor Technology division also led to a shift in the production and sales mix towards electronic products, which have a significantly higher material share than the products of the other two divisions. The revenues posted by the Diesel Cold-Start Technology division decreased from EUR 53.6 million to EUR 43.6 million. This was due to the slower than planned ramp-up of an ISS (instant-start system) order in the United States, as well as the weaker Aftermarket business due to the mild winter and the increasing pressure on prices in the market for these products. Varying picture of regional revenue trends In regional terms, the BERU Group’s sales revenues in the domestic market of Germany increased by 13.5% to EUR 39.8 million (EUR 35.1 million). In Europe excluding Germany, sales revenues decreased to EUR 50.4 million (EUR 57.3 million). BERU also posted lower sales revenues in North America: EUR 9.5 million compared with EUR 12.9 million in the first quarter of 2006. The strongest regional growth was achieved in Asia, where sales revenues rose by 29.1% to EUR 12.5 million (EUR 9.7 million). In the other international markets, BERU achieved sales revenues of EUR 4.5 million (EUR 2.4 million). The proportion of revenues generated outside the domestic market was 65.9%. Ongoing high liquidity The Group’s cash and cash equivalents and marketable securities increased to EUR 104.9 million at the end of the first quarter of 2007 (end of Q1 2006: EUR 75.8 million). BERU’s net financial position increased by 38.5% to EUR 104.7 million (EUR 75.6 million). BERU invested 6.1% of total sales revenues or EUR 7.1 million in the expansion of its production facilities in Germany and abroad in the first quarter (Q1 2006: EUR 8.7 million). As of March 31, 2007, the Group employed a total workforce of 2,580 persons (March 31, 2006: 2,609). BERU maintains guidance for 2007 Despite the weaker first quarter because of the mild winter, the Executive Board of BERU AG maintains its forecasts. Sales revenues are expected to increased by a low single-digit percentage and earnings are likely to remain fairly flat in 2007 and 2008. As of 2009, new orders and the ramp-up of new products should lead to stronger growth once again. BERU results for the first quarter of 2007 (January 1 – March 31, 2007) on the basis of preliminary unaudited figures
¹ On the basis of preliminary unaudited figures
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