The globally operating lubricant producer FUCHS PETROLUB AG in Mannheim, Germany, in 2002 achieved the best result in the group's history. It thus successfully bucked the general trend, which has been characterized by a weak or declining business cycle, general uncertainties in the run-up to the Iraq war, and since the middle of last year by substantial rises in input material prices. Sales rose by 13.3 % to reach € 1,065 million (940), operating profits by 42.2 % to € 90.7 million, and the consolidated net income for the year by 172.5 % to € 24.1 million (8.8). The total return on capital was upped to 15.5 %. Capital expenditure on tangible and intangible assets came to € 28.8 million, and was thus at the preceding year's level of 28.7. The worldwide workforce increased, due essentially to consolidation factors, to 4,081 employees. FUCHS PETROLUB AG reported a net income of € 16.8 million for 2002, and will be proposing to the shareholders an increase of € 0.50 in the dividends, to € 4.37 per ordinary share and € 4.88 per preference share. For the current year, the group anticipates sales of about € 1.1 billion, and, subject to any further effects of the war in Iraq, a good earnings situation.

Internal growth in sales, with contributions coming from all regions, totaled 5.8 % or € 54.5 million. It was driven particularly by volume increases, but also by changes in mix and prices. Despite an unfavorable macro-economic situation worldwide, internal growth was especially strong in the Asia-Pacific, Africa Region, at € 26.1 million (19.9 %). The vigorous external growth was particularly attributable to first-time full consolidation of FUCHS EUROPE SCHMIERSTOFFE, and totaled € 106.3 million (11.3 %). The euro's rise against almost all other currencies, however, meant the exchange rate factor reduced sales by € 36.1 million (-3.8 %), with the adverse effects most severe in the North and South America Region.

In comparison to the preceding year, the proportions accounted for by automotive and industrial business have undergone a slight shift. Business with industrial lubricants was up by 6.8 % to € 613.4 million (576.6), and though it still constituted 60 % (65 %) of total lubricant sales, the proportion of sales coming from automotive lubricants rose to 40 % (35) or € 405 million (314.3). The causes of this shift are to be found both in the full consolidation of FUCHS EUROPE SCHMIERSTOFFE and in another significant increase in business with high-quality first-fill oils at home and abroad.

Besides its good positioning in all regions, the group's success was boosted by a high-quality product portfolio, an easier first half of the year on the input-material markets and improved production processes, all of which is reflected in a 17.8 % rise in gross income from sales, to € 399.7 million (339.2). Thanks to optimized infrastructures, the proportion of selling, administration and R&D costs in sales fell from 29.3 % to 29.0 %. The operating result was thus increased compared to the preceding year by 42.2 % to € 90.7 million (63.8), and is now 8.5 % (6.8 %) of sales.

The negative balance of the other operating income rose by € 2.6 million, due to exchange-rate, restructuring and consolidation effects. Goodwill amortization of € 15.0 million also includes special risks in addition to normal amortization of € 10.7 million. Earnings before interest and taxes (EBIT) reached a value of € 70.0 million (50.5), corresponding to a rise of 38.6 %.

Net financial income of € -26.0 million (25.6) includes write-downs on financial assets (1.1). Taxes on income developed underproportionally, so that the group's taxation ratio was substantially down, at 45.3 % (64.5). The group's net income for the year thus reached a record level of € 24.1 million (8.8), corresponding to an increase of 172.5 %.

Capital expenditure on tangible and intangible assets (excluding goodwill acquired), at € 28.8 million, was at the preceding year's level (28.7). Acquisitions resulted in additions of € 2.4 million (17.1) to goodwill. Major investment projects included the restructuring of research and development activities at FUCHS EUROPE SCHMIERSTOFFE, the construction of a new plant for FUCHS LUBRITECH in Kaiserslautern, plant expansion jobs in Italy and Spain, and the upsizing of production capacities in the USA.

Worldwide, the group was employing 4,081 (3,871) people on 31 December 2002. Due primarily to consolidation factors, the total payroll thus increased by 210 people or 5.4 %. 1,156 (931) were employed in Germany, and 2,925 (2,940) abroad.

In the past business year, FUCHS PETROLUB AG achieved a net income of € 16.8 million, € 5.7 million up on the preceding year's figure of 11.1. Taking into account the profit brought forward of € 8.9 million (7.6), this led to an unappropriated profit of € 25.7 million (18.7). This gratifying development was attributable not least to investment income, up by € 5.1 million to € 46.5 million (41.4). For appropriation of profits, the Executive and Supervisory Boards will be proposing to the shareholders an increase of € 0.50 in the dividends for the past business year, to € 4.37 per ordinary share and € 4.88 per preference share.

The group made a good start to the ongoing business year. Consolidated sales in the first quarter of 2003 totaled € 263.4 million, and were thus slightly below last year's figure (265.7). This once again conceals - particularly in Asia-Pacific - significant internal growth of 5.7 %, which due to the substantial alteration in exchange rates does not show up after translation.

For 2003 as a whole, without factoring in any acquisitions, the group has budgeted for sales of about € 1.1 billion, and, subject to any further effects of the war in Iraq, expects a good earnings situation. Capital expenditure on tangible assets, at € 25 million, has been budgeted at 13 % less for 2003 than in the preceding year, since the plants worldwide are in good shape.


Mannheim, 15 April 2003