Tangible improvement in sales and earnings position at INDUS
- Positive EBIT of EUR 35.9 million in first nine months
- 10 % increase in cash flow from operations
Bergisch Gladbach, November 27, 2009 - At the end of the first nine months of the financial year, INDUS’ business performance has clearly stabilized. Since summer 2009, sales and earnings have performed notably better than in the first half of the year. Sales grew by 13 % between the first and third quarters, while operating earnings (EBIT) improved by almost 60 %. Following EBIT of EUR 8.9 million in the 1st quarter and EUR 11.9 million in the 2nd quarter, earnings before interest and taxes amounted to EUR 15.1 million in the 3rd quarter.
INDUS Holding AG posted sales of EUR 565.7 million (previous year: EUR 702.6 million) and operating earnings before interest and taxes (EBIT) of EUR 35.9 million (previous year: EUR 79.8 million) as of the reporting date on September 30, 2009. Restructuring expenses of around EUR 3.3 million have already been accounted for in the earnings figures.
Cost-cutting program substantially reduces cost of materials and personnel expenses
All in all, cost of materials and personnel expenses fell by around EUR 100 million. While the cost of materials reduced by more than EUR 90 million, mainly due to the development in sales and lower raw material and energy prices, a series of measures has reduced personnel expenses by around EUR 10 million. In particular, these include working down overtime, time and vacation accounts, allowing temporary employment relationships and contracts to expire and postponing collective pay increases. Where there was no alternative, employees were also made redundant. Overall, INDUS Holding AG has cut 423 jobs in a socially responsible manner since the beginning of the year (total workforce as of 9.30.2009: 5,439).
Sharp rise in cash flow from operations
At EUR 67.5 million, the cash flow from operating activities in the first nine months of 2009 was around 10 % up on the previous year’s figure of EUR 60.7 million. The conservative financing policies at INDUS in recent years have protected the company not only against the current credit crunch, but also against higher interest expenses. Interest expenses have currently reduced in spite of the financial crisis. Net debt has reduced by EUR 12 million and the equity ratio amounts to 25.2 %.
Construction and Consumer Goods segments cushion downturn in sales in Automotive and Engineering segments
The automotive supplier segment has been hit hardest by the economic crisis. The sharp decline in demand led to negative EBIT of EUR -6.2 million. The four other investment segments at INDUS Holding AG, on the other hand, showed pleasingly stable developments compared with their respective markets. This was especially true for the Construction (sales: EUR 155.0 million; EBIT margin 12.1 %) and Consumer Goods segments (sales: EUR 68.5 million; EBIT margin: 11.5 %). The Engineering sector also maintained its ground well in an extremely negative market climate (sales: EUR 96.4 million; EBIT margin: 9.4 %).
Slight upward trend in sight towards year-end
Helmut Ruwisch, Chairman of the Board of Management of INDUS Holding AG, is cautiously optimistic. "Our broad-based portfolio and the strong market position of our subsidiaries mean we will post positive operating earnings in 2009 in spite of the recession. Our business model has thus proven its resilience. Given the positive order situation, we currently expect the business to perform stably through to the end of the year. Should this order situation continue, then we expect to achieve slight sales growth in 2010."
Forecast with outlook for 2009 financial year confirmed
The business results for the first nine months of 2009 confirm the assessment made by INDUS Holding AG that its sales and earnings will fall significantly short of the figures for 2008. For the financial year as a whole, INDUS has confirmed its sales and earnings forecast. Sales are expected to amount to between EUR 740 million and EUR 750 million, while operating earnings (EBIT) should reach between EUR 40 million and EUR 50 million.
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