WashTec AG / Key word(s): Enterprise/
WashTec AG: WashTec earnings performance below prior year due to
unanticipated losses in North America
DGAP-Media / 04.11.2011 / 07:37
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WashTec earnings performance below prior year due to unanticipated losses
in North America
- After three quarters, revenue increase by 11.8% to EUR 212.7m revenues
in third quarter below expectations and order intake below prior year
- EBIT per end of September at EUR 11.7m, EUR 0.2m below prior year
- Outlook: Order intake significantly below prior year reflects poor
market environment - no revenue growth expected in fourth quarter -
full year earnings below prior year
- Group-wide program enacted for improving earnings; expenses will reduce
earnings in 2011
Augsburg, November 4, 2011 - After the first three quarters of fiscal year
2011, WashTec AG - the leading supplier of innovative solutions for the
carwash business worldwide - is still reporting solid revenue growth
despite increasingly difficult general conditions. Group revenues rose
11.8% to EUR 212.7m in the first nine months (Q1-Q3 2010: EUR 190.3m). This
increase resulted primarily from the improvement of the Group's market
position in North America and Australia as well as the expansion of
chemical activities following the acquisition of AdeKema in northern
Europe. On an adjusted basis, WashTec is reporting a positive organic
revenue growth of approximately 4%. The positive development in adjusted
revenues is attributable above all to the considerable added growth in the
»Emerging Europe« region and to the increase in revenues from the chemicals
and operating business in Core Europe. On the cost side, WashTec has
succeeded in largely offsetting the significant increase in the cost of raw
materials by improving efficiencies. The personnel expense ratio was even
improved yet again. After adjusting for non-recurring and foreign exchange
effects, which were positive in 2010 and negative in 2011, EBIT (earnings
before interest and taxes) rose significantly by approximately seven
percent from EUR 11.7m to EUR 12.5m. EBIT under IFRS declined slightly from
EUR 11.9m to EUR 11.7m. Whereas the development in the other regions was
satisfactory in light of the difficult market conditions, the results
reported for the North American business did not meet expectations. The
profit before taxes of the WashTec Group increased by EUR 0.1m to EUR
10.5m. Earnings per share climbed from EUR 0.37 to EUR 0.41.
As of September 30, net cash flow declined by EUR 5.1m to EUR 13.5m due to
the growth-related changes in net current assets. It should be noted in
this regard that the cash flow in 2010 was unusually high because a large
volume of trade payables was settled before they matured. Despite higher
expenditures to expand the Group, free cash flow remained positive at EUR
6.5m. The most important balance sheet ratios remain very solid: the equity
ratio grew from 43.5% at the end of 2010 to its current 45.3%. The gearing
(debt-to-equity ratio) remained relatively stable at 0.31.
Addressing business development, the Chairman of Management Board of
WashTec AG, Thorsten Krüger, remarked: 'On an aggregate basis over the
first three quarters, WashTec is reporting a significant jump in revenue
and solid earnings quality. Due to the deteriorating general conditions in
the economy, however, we have had to acknowledge a slowdown in growth
during the third quarter. This will mean that we will need to adjust our
guidance downward'.
Despite revenue growth, operating result for 2011 presumably below last
year's level
The poorer overall conditions and the concomitant lower order intake in the
third quarter have already had an impact. thin addition, unanticipated
losses occurred in North America during the third quarter. The findings,
which were made after a management change in connection with the
preparation of the quarterly financial statements, are currently being
analyzed and verified. In the meantime, the person formerly responsible for
the 'DACH' region, the largest entity of the WashTec Group, has been
appointed as COO in the USA. Furthermore the local finance department has
been strengthened by an employee from the German headquarters. The
Management Board will take appropriate action and evaluate the strategic
options and will be actively monitoring the next course of action to take
in North America. Based on the findings at this time, the Company is
expecting a decline in earnings of 10-15% compared to the prior year. In
order to adjust the cost structures of the WashTec Group to account for the
difficult market environment, a Group-wide program was enacted to improve
earnings. One-time restructuring expenditures and write-downs made in
connection with such measures will further reduce earnings significantly in
the current fiscal year.
Due to the currently unclear overall situation in the markets, the 2012
forecast is subject to considerable uncertainties. Thus, a forecast for
2012 cannot be provided. WashTec will review the work and activities of the
Group with an eye towards earnings contribution and optimization potential.
Further expansion through acquisitions is not planned. WashTec will pursue
conservative expense and investment policies and draw its focus on
projects, areas and regions which promise the best mid-term growth
prospects. Despite a consolidation, the Company will not abstain from
future projects. By virtue of the long-term financing of the Company and
its solid balance sheet, WashTec believes that it is well prepared for
future challenges and will emerge even stronger from a difficult market
situation.
Key Group Figures as of September 30, 2011:
EURm, IFRS Q1 - Q3 Q1 - Q3 3rd quarter 3rd quarter
2011 2010 2011 2010
Revenues 212.7 190.3 72.3 66.6
EBITDA 19.4 19.0 7.0 7.6
EBIT 11.7 11.9 4.3 5.2
EBIT margin (in %) 5.5 6.3 5.9 7.8
Comparable adjusted 12.5 11.7 4.6 5.3
EBIT*
EBT 10.5 10.4 3.9 4.8
Consolidated net 5.8 5.2 1.6 2.6
income
Earnings per share** 0.41 0.37 0.11 0.18
Net cash flow 13.5 18.6
Net current 75.5 63.3
assets***
ROCE**** (in %) 9.0 8.9
EURm, IFRS Sep 30, 2011 Dec 31, 2010
Balance sheet total 210.5 217.1
Equity 95.3 94.4
Equity ratio (in %) 45.3 43.5
Net financial indebtedness 29.6 26.6
Gearing (debt-to-equity ratio)***** 0.31 0.28
Employees 1,668 1,639
* Adjusted for non-recurring effects including foreign exchange effects
** Basis: unchanged number of shares 13,976,970
*** Trade receivables + inventory - trade payables
**** »Return On Capital Employed« = adjusted EBIT / (total asserts -
short-term liabilities - cash and cash equivalents); based on equal
dividend payments
***** Net financial indebtedness to equity
Additional information about the Company and the WashTec AG report
concerning the first three quarters of 2011 are available for download from
our website at www.washtec.de.
Information on WashTec:
WashTec has its registered offices in Augsburg, Germany, and is the leading
supplier of innovative solutions for the carwash business worldwide.
WashTec employs more than 1,600 persons worldwide and has its subsidiaries
in the core markets of Europe, the United States, and Canada as well as in
China and Australia. WashTec has independent sales partners in roughly 60
countries.
Contact:
WashTec AG
Argonstrasse 7
86153 Augsburg
Tel.: +49 (0)821 - 55 84 - 0
Fax: +49 (0)821 - 55 84 - 1135
End of Media Release
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Language: English
Company: WashTec AG
Argonstraße 7
86153 Augsburg
Germany
Phone: +49 (0)821 55 84-0
Fax: +49 (0)821 55 84-1135
E-mail: washtec@washtec.de
Internet: www.washtec.de
ISIN: DE0007507501
WKN: 750750
Listed: Regulierter Markt in Frankfurt (Prime Standard);
Freiverkehr in Berlin, Düsseldorf, München, Stuttgart
End of News DGAP-Media
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144728 04.11.2011
(END) Dow Jones Newswires
November 04, 2011 02:37 ET (06:37 GMT)