Generating net profits of €27.0 million in the first quarter of 2007, 39% more than previous year, FUCHS continued its successful development.
The acquisition of two small companies in the important growth market Brazil, has strengthened the specialty lubricants division in South America.
In the first quarter of 2007, sales revenues grew by 6.1 %. The drop in sales revenues of 1.8 % caused by external effects results from the sale of the polishing division and the first time consolidation of the companies in the Ukraine and Turkey. Taking into account the currency translation effects (-2.3 %), net sales growth was 2.0 %. In total, sales revenues amounted to €339.2 million (332.7).
This successful profit development is based on the disproportionate increase of gross profit by 7.6 % or €8.7 million to €123.2 million and effective cost management. Earnings before interest and taxes (EBIT) increased by 30.7 % or €10.3 million to €43.9 million (33.6). Due to a reduction in debt, the financial result improved, leaving a profit of €27.0 million (19.4) after taxes. This result follows the profitable last three quarters of 2006 seamlessly. Earnings per ordinary and preference share amounted to €1.03 (0.74) and €1.04 (0.75) respectively.
Two smaller acquisitions in the specialties segment of FUCHS LUBRITECH have expanded the Group's business in the important growth market of Brazil. In March 2007 the forging business of Igucima Indústria de Lubrificantes Ltda. Was acquired, and in April the specialty grease business of Tribotécnica Lubrificantes Especiais Ltda. followed. Through these two acquisitions, sales revenues of FUCHS DO BRASIL, amounting to €22 million in 2006, will increase by approximately 20%.
FUCHS expects an increase in sales revenues over the entire year 2007. Due to the influence of raw material pricing and the development of exchange rates, growth rates will not be as high as in previous years. With regard to earnings before interest and taxes, the Group is striving to increase the 2006 record profit. The high, double-digit growth rates of the previous years, however, will not be repeated over the entire year 2007, although the first quarter 2007 shows a high rate of increase due to base effects.
Shareholders' representatives and shareholders welcomed the shareholder-friendly dividend policy since the initial public offering in 1985, explained by Stefan Fuchs, Chairman of the Executive Board, in his speech before the shareholders' general assembly. In this period, annual dividend payments for preference shares have increased by almost 7 % per annum. For 2006, total distribution was increased by more than 40 % compared to the previous year.
With a total presence of almost 40 % and a presence of the ordinary shares of more than 70 %, executive management proposals were adopted unanimously or with an overwhelming majority. One of these proposals was the payment of an increased dividend of €1.00 for each preference share and €0.94 € per ordinary share.
The first quarter 2007 at a glance
Group
| (Values in € million) | 1-3/2007 | 1-3/2006 |
|---|---|---|
| Sales revenues 1 | 339.2 | 332.7 |
| Europe | 234.1 | 217.3 |
| North and South America | 54.7 | 63.6 |
| Asia-Pacific, Africa | 59.7 | 57.6 |
| Consolidation | -9.3 | -5.8 |
| Earnings before interest and taxes (EBIT) | 43.9 | 33.6 |
| Net profit for the first quarter | 27.0 | 19.4 |
| Gross cash flow | 30.9 | 24.2 |
| Capital expenditure 2 | 4.7 | 5.3 |
| Employees (on March 31) | 3,798 | 4,037 |
1 By companies' headquarters
2 In property, plant and equipment and intangible assets
Mannheim, May 2, 2007
FUCHS PETROLUB AG
Public Relations
Friesenheimer Str. 17
68169 Mannheim
Phone: ++49 (0) 621 3802 - 105
The press release can also be found on the Internet at www.fuchs-oil.com
Link to the Quarterly Report:
www.fuchs-oil.de/fileadmin/fuchs_upload/pdf_addons/QR2007/QB45_e.pdf
Important note
This press release contains statements about future development that are based on assumptions and estimates by the management of FUCHS PETROLUB AG. Even if the management is of the opinion that these assumptions and estimates are accurate, future actual developments and future actual results may differ significantly from these assumptions and estimates due to a variety of factors. These factors can include changes to the overall economic climate, changes to exchange rates and interest rates and changes in the lubricants industry. FUCHS PETROLUB AG provides no guarantee that future developments and the results actually achieved in the future will agree with the assumptions and estimates set out in this press release and assumes no liability for such.