Wienerberger records clearly positive cash flow despite continuing
weak demand
(Thomson Reuters ONE) - Corporate news announcement processed and transmitted by Hugin AS.The issuer is solely responsible for the content of this announcement. ------------------------------------------------------------------------------------ NOT FOR DISTRIBUTION IN THE UNITED STATES, CANADA, JAPAN OR AUSTRALIA- Revenues -26% to ? 1,416.7 million; operating EBITDA -51% to ?177.5 million- Cost savings of ? 135 million realized during the first ninemonths- Inventories reduced by more than ? 100 million- Free cash flow totals ? 110 million- Net debt declines to ? 540 millionVienna, November 6, 2009 - Wienerberger AG, the world's largestproducer of bricks, was impacted by the continuing effects of theglobal economic and financial crisis during the first nine months ofthis year. Bank constraints on project financing for housing andabove all the decline in consumer confidence triggered a sharp dropin new residential construction. Against this backdrop, Wienerbergerrecorded a 26% decrease in revenues to ? 1,416.7 million and 51%lower operating EBITDA of ? 177.5 million (before restructuringcosts) and a drop in operating EBIT of 83% to ? 36.7 million. Due torestructuring costs of ? 81.4 million (comprising ? 29.3 million ofcash expenses and ? 52.1 million of special write-downs) as well asthe half-year recognition of ? 28.2 million in impairment charges toproperty, plant and equipment and also, of ? 124.4 million togoodwill profit before tax was clearly negative at ? -225.3 million.Profit after tax totaled ? -198.2 million as a result of positive taxeffects, and adjusted earnings per share equaled ? -0.01.Liquidity remains top priority"The year got off to a weak start in all our markets. Sales volumesfell dramatically, especially in Central-East Europe and NorthAmerica, and new residential construction continued to contractacross Western Europe - above all in Great Britain, the Netherlandsand France" explained Heimo Scheuch, Chief Executive Officer ofWienerberger AG, the developments in the challenging operatingenvironment." An analysis by quarter shows a slower decline inrevenues over the course of the year: the third quarter decrease wasslightly smaller than the decrease in the second quarter, partlybecause of the lower comparative values for the third quarter of theprevious year. "Although volume declines were more moderate duringthe summer, September remained below expectations - especially in theUSA and Eastern Europe - and there are no signs that the downturn inthe operating business will soon bottom out. The only improvement involumes was reported by Great Britain, with a slight increase overthe (low) prior year level in September, which still cannot beinterpreted as a change in trend. For these reasons, cashpreservation and reduction in fixed costs will remain our toppriority", emphasized Heimo Scheuch, underscoring the Wienerbergerstrategy.Cost structures adjusted as part of action plan 2009Wienerberger reacted to the sharp decline in demand during the firstquarter with an extensive action plan. After removing 27 plants fromthe production network in 2008, the measures originally defined for2009 involve the shutdown or mothballing of another 26 plants tomatch market conditions as well as active working capital managementto reduce inventories by at least ? 100 million, a decrease in fixedcosts through restructuring in salesand administration, and a cutback in investments to a minimum.Action plan extended to five more plantsThe development of business after the summer remained less favorablethan expected. Consequently the action plan was expanded to includethe closure or mothballing of five additional plants in Hungary,Germany, Poland and the USA. An estimated 31 plants are to be closedor mothballed during 2009 at a cost of ? 120 million (? 50 million ofcash expenses and ? 70 million of special write-downs) - 24 of theseplants were shut down during the first nine months. In addition,extensive temporary standstills are planned to reduce inventories.These measures affected atotal of 1,660 employees during the reporting period. The temporarilyclosed locations and mothballed production lines represent asubstantial capacity reserve that can be reactivated quickly asneeded.Cost savings of ? 135 million already realizedThe measures implemented to date led to a year-on-year decrease ofroughly ? 135 million in personnel and maintenance costs during thefirst nine months of 2009. In addition, active capacity managementsupported a reduction of more than ? 100 million in inventoriescompared with the first three quarters of 2008. Investments were alsocut by a significant amount: maintenance costs fell by one-half toapprox. ? 37 million, while the ? 68 million in growth investmentsthat were required to complete projects started in 2008 were 76% lessthan in 2008.Free cash flow of approx. ? 110 millionThe success of the action plan has already been reflected in freecash flow generation: despite weaker operating results and adifficult operating environment, both cost savings and the reductionof inventories allowed Wienerberger to generate an impressive freecash flow of ? 109.9 million for the reporting period (2008: ? 122.2million).Approx. ? 155 million of cost savings expected in 2009Cost savings for the full reporting year are forecasted to total ?155 million. In 2010 additional savings of at least? 35 million are expected from the measures implemented during thesecond half of 2009, which represents a cumulative reduction of ? 190million in fixed costs compared with 2008.Net debt reduced to ? 540.5 millionIn order to increase financial flexibility, Wienerberger carried outa capital increase in September and strengthened its equity base byroughly ? 320 million with the issue of 33.6 million new shares (40%of share capital). Equity subsequently rose by 4% to ? 2,587.4million. Net debt was reduced from ? 978.6 million in June to ? 540.5million as of September 30, 2009, with roughly ? 320 million of thisreduction coming from the capital increase and nearly? 118 million from cash flow. Gearing improved from 43,3% to 20.9%during the same period.Higher cash flows and earnings expected in 2010"Given the weak condition of new residential construction on all ourmarkets, I do not expect any significant improvement in earnings byyear-end 2009. Operating EBITDA for the second half of 2009 shouldtherefore reflect the level recorded for the first six months",summarized Wienerberger CEO Heimo Scheuch. "Bank constraints onfinancing, rising unemployment and the high number of foreclosures inthe USA are working against a turnaround in new residentialconstruction. It is too early to speak of recovery from today'sperspective because the economic environment is still difficult, butthe measures we have implemented lead me to be more optimistic about2010.Even if demand remains weak, I expect the coming year will bringconsiderable improvement in earnings and cash flow due to the costsavings realized through our action plan and an improved utilizationof capacity in our plants."Earnings Data 1-9/ 1-9/ Chg. Year-end 2008 2009 in % 2008Revenues in ? 1,926.8 1,416.7 -26 2,431.4 mill.Operating EBITDA 1) in ? 364.7 177.5 -51 440.1 mill.Operating EBIT 1) in ? 212.4 36.7 -83 239.8 mill.Profit before tax in ? 160.9 -225.3 <-100 123.1 mill.Profit after tax 2) in ? 133.0 -198.2 <-100 103.3 mill.Earnings per share in ? 1.28 -2.68 <-100 0.81Adjusted earnings per in ? 1.65 -0.01 <-100 1.69share 3)Free cash flow 4) in ? 122.2 109.9 -10 195.4 mill.Maintenance capex in ? 71.7 36.6 -49 98.4 mill.Growth investments in ? 282.2 67.7 -76 407.2 mill.Balance Sheet Data 31.12.2008 30.9.2009 Chg. in %Equity (incl. in ? mill. 2,497.2 2,587.4 +4hybrid capital)Net debt in ? mill. 890.2 540.5 -39Capital employed in ? mill. 3,252.2 2,991.1 -8Balance sheet total in ? mill. 4,383.9 4,450.2 +2Gearing in % 35.6 20.9 -ÿ Employees 15,162 12,922 -15Segments 1-9/2009in ? mill. Central- Central- North- West North Investmentsand % East Europe West Europe Europe 5) America and Other 6) 5)Revenues 462.6 (-35) 300.1 (-13) 562.5 (-22) 118.3 (-35) -26.8 (+26)Operating 87.2 (-58) 28.9 (-21) 85.4 (-32) -9.0 (<-100) -15.0 (+19)EBITDA 1)Operating 39.7 (-75) 3.0 (-63) 36.3 (-48) -25.7 (<-100) -16.6 (+23)EBIT 1)Total 48.2 (-65) 8.7 (-67) 33.5 (-76) 9.0 (-73) 4.9 (-83)investmentsCapital 821.8 (-6) 432.3 (-18) 1,181.8 (-15) 510.0 (-10) 45.2 (>100)employedÿ Employees 5,300 (-10) 2,176 (-10) 4,098 (-15) 1,105 (-47) 243 (+10)Segments 7-9/2009 Revenues Operating EBITDA 1)in ? mill. 7-9/ 7-9/ Chg. in 7-9/ 7-9/ Chg. in 2008 2009 % 2008 2009 %Central-East 261.4 187.1 -28 73.8 38.7 -48EuropeCentral-West 125.1 117.7 -6 18.4 17.5 -5Europe 5)North-West Europe 225.0 182.3 -19 35.2 24.0 -325)North America 63.4 42.0 -34 5.3 -1.1 <-100Investments and -11.7 -10.6 +9 -3.6 -2.2 +39Other 6)Wienerberger Group 663.2 518.5 -22 129.1 76.9 -401) Adjusted for non-recurring income and expenses2) Before non-controlling interests and accrued hybrid coupon3) Adjusted for non-recurring income and expenses; after hybridcoupon4) Cash flow from operating activities minus cash flow from investingactivities plus growth investments5) Cross-border trading activities of the Netherlands and Germanywere transferred to the Central-West Europe segment as of January 1,2009 (previously: North-West Europe); the comparable figures from theprior year period were adjusted accordingly6) Including Group eliminations and holding costs; negative revenuesare due to the offset of inter-company salesNote: In the table of segment data, changes in % to the comparableprior year period are shown in bracketsVisit www.wienerberger.com to download the Report on the First ThreeQuarters with detailed information and view a live Internettransmission of the teleconference with analysts at 2:00 p.m. CET.For additional information contact:Barbara Braunöck, Head of Investor and Public RelationsT +43(1)60192-467 | communication(at)wienerberger.comLegal Disclaimer:This press release serves marketing purposes in Austria. The offer ofsecurities of Wienerberger AG in Austria is being made solely bymeans and on the basis of the published prospectus in accordance withthe provisions of the Austrian Capital Markets Act, which has beenpublished at the homepage of the company under www.wienerberger.comand is available free of charge at Wienerberger AG (Wienerbergstraÿe11, A-1100 Vienna).This press release is not for distribution in or into the UnitedStates of America and must not be distributed to U.S. persons (asdefined in Regulation S under the U.S. Securities Act of 1933, asamended ("Securities Act")) or publications with a generalcirculation in the United States. This press release does notconstitute an offer or invitation to purchase any securities in theUnited States. The securities of Wienerberger AG have not beenregistered under the Securities Act and may not be offered, sold ordelivered within the United States or to U.S. persons absentregistration under the Securities Act or an applicable exemption fromthe registration requirements of the Securities Act. There will be nopublic offer of securities of Wienerberger AG in the United States.This press release is directed only at persons (i) who are outsidethe United Kingdom or (ii) who have professional experience inmatters relating to investments falling within Article 19(5) of theFinancial Services and Markets Act 2000 (Financial Promotion) Order2005 (as amended) (the "Order") or (iii) who fall within Article49(2)(a) to (d) ("high net worth companies, unincorporatedassociations etc.") of the Order (all such persons together beingreferred to as "Relevant Persons"). Any person who is not a RelevantPerson must not act or rely on this communication or any of itscontents. Any investment or investment activity to which thiscommunication relates is available only to Relevant Persons and willbe engaged in only with Relevant Persons.Downlaod the press release from www.wienerberger.com. If you do notwish to receive the Wienerberger newsletter any longer, send ane-mail with subject: "unsubscribe newsletter" tocommunication(at)wienerberger.comhttp://hugin.info/132489/R/1353077/327673.pdf --- End of Message ---Wienerberger AGWienerbergstraÿe 11 Vienna AustriaWKN: 83170; ISIN: AT0000831706; Index: WBI, ATX , ATX Prime;Listed: Prime Market in Wiener Boerse AG;
Datum: 06.11.2009 - 08:02 Uhr
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