VIENNA, Austria, Aug. 27, 2002 (PRIMEZONE) -- Wienerberger:
-- Results significantly exceed expectations and prior year -- Sales 7% to EUR 799.3 million, EBITDA 37% to EUR 147.3 million, EBIT from EUR 32.1 to EUR 72.6 million -- Strategy and goals confirmed -- Core shareholders amend syndication agreement: Wienerberger to become a "free float company"
Excellent results in spite of difficult environment In spite of the difficult operating environment, the Wienerberger Group recorded a sizeable improvement in earnings during the first half of 2002. This development was a direct result of the consistent and rapid implementation of restructuring and optimization measures in 2001.
Organic sales growth: 3%
Group sales rose by 7% to EUR 799.3 million. Organic sales growth totaled 3%, and resulted primarily from higher sales volumes and prices in the growth markets of Eastern Europe. In addition, the brick activities of Hanson plc in Continental Europe added EUR 30.7 million. In the Pipe and Roofing Investments segment, Bramac (concrete roofing systems) profited from its subsidiaries in Eastern Europe but the Pipelife and Steinzeug joint ventures were faced with declining sales, above all in Western Europe.
Significant Earnings Improvement in All Areas
Group EBITDA (earnings before depreciation, interest and taxes) increased by 37% over the comparable prior year value to EUR 147.3 million, primarily as a result of successful optimization programs. All countries reported higher earnings, and in some cases significant growth. The main driver for this substantial improvement was the brick business in Germany, where plant shutdowns in 2001 led to a further reduction in costs and higher prices. The initial consolidation of Hanson activities added EUR 5.3 million to Group EBITDA. Satisfactory earnings growth was also recorded in the Pipe and Roofing Investments segment.
Earnings per Share More Than Triple
EBIT (earnings before interest and tax) rose from EUR 32.1 to 72.6 million, or more than double the comparable prior year value. Financial results declined from EUR 12.0 to 19.2 million. Profit after tax showed a significant increase from EUR 14.5 to 44.6 million, and earnings per share more than tripled from EUR 0.20 to 0.67.
Free cash flow used to finance Hanson acquisition A total of EUR 113.4 was spent on capital expenditure and acquisitions, EUR 65.4 million thereof for the purchase of Hanson. Free cash flow before major projects reached EUR 55.0 million, and provided a substantial part of the financing for the Hanson acquisition. Equity decreased by 6% to EUR 928.1 million because of negative foreign exchange effects related to the weaker U.S.-Dollar and Polish Zloty. Gearing totaled 78% at the end of the first six months, but will decline again to a level of 70% by yearend.
Goal for 2002: EBIT Significantly Above EUR 100 Million
Earnings indicators for the first six months of this year approached operating levels from the record year 2000. Wienerberger will record operating EBIT of significantly more than EUR 100 million for 2002 despite adverse market conditions, and therefore come closer to the comparable EUR 147 million earned in 2000.
Economic forecasts remain cautious
Our economic forecast remains unchanged, however. We anticipate no signs of recovery in Central Europe or the Benelux countries and weakness is expected to continue, especially in the Netherlands. In Germany forecasts call for new housing starts to drop by a further 15%, and recovery expected for the construction industry in 2003 is questionable. Plant standstills and cost of idle capacity will therefore rise during the second half of this year. In the USA housing starts have reached a high 1.7 million units, supported by the growing population and historically low interest rates. Declining consumer confidence could have a subduing impact on this momentum, however. We expect growth in Eastern Europe, where the feared downturn in the Polish construction branch has not materialized.
Opportunities for expansion with high potential for synergy The core business of Wienerberger is bricks and related building materials. For the further development of the Group, we see longterm opportunities in the growth markets of Eastern Europe and the USA. In Western Europe we will continue to optimize existing operations, develop new products, and gradually increase our market positions. The rapid integration of Hanson brick activities will decisively strengthen our market position and earning power in Northwest Europe. This is expected to create synergies of EUR 13 million annually, which will be realized in part this year and fully beginning in 2003. As the world's leading producer of bricks, Wienerberger will identify and utilize opportunities for expansion that carry a high potential for synergy in order to grow profitably in the future.
Wienerberger to become "free float company"
Since 1996 Bank Austria Creditanstalt and Koramic Building Products have jointly held more than 50% of the shares in Wienerberger AG. These majority shareholders have now amended their syndication agreement, and will reduce their holdings to less than 50%, with the aim of transforming Wienerberger into a free float company. This will give Wienerberger the option of financing future growth over capital markets, and also enable the company to play a major role in the consolidation of the international building materials industry. The reduction in these holdings will be gradual and coordinated, in order to avoid negative influence on the Wienerberger share price. Wienerberger management welcomes this decision by the majority shareholders, which will give the company an additional impulse for a successful future.
Visit our Website for download of the press release including key figures and Interim Financial Report 2002 (pdf-file) www.wienerberger.com
Our press conference will be streamed live on our website (translation provided), starting at 10 a.m. We cordially invite you to follow the presentation of the manging board.
Wienerberger AGThe Managing Board Vienna, August 27, 2002