Vossloh making progress
12-month sales and earnings forecast confirmed—Group’s EBIT margin slightly up in Q3—Steps taken to sell off Information TechnologiesThe Vossloh Group raised its EBIT margin in the third quarter of 2006 by 0.2 percentage points from the year-earlier 9.1 to 9.3 percent.
In the first nine months of 2006, the Group generated sales of €689.6 million, an increase of around 2 percent versus the year-earlier period. In a market environment of again heavy price pressure, the added sales were, in particular, generated by the Infrastructure Services and Electrical Systems business units.
Excluding the Information Technologies (IT) division, the Group posted Q3/2006 sales of €229.5 million, €29.3 million less than in Q3/2005. Whereas Rail Infrastructure’s sales showed a slight gain, Motive Power’s were, as expected, lower due to fewer locomotives sold.
Three-quarter (3Q) EBIT amounted to €50.1 million. Around €19 million of the burdens mentioned in the ad-hoc notification of June 23, 2006, eroded the 3Q/2006 group earnings.
“We’re moving ahead step by step,” stated Dr. Gerhard Eschenröder, CEO of Vossloh AG. “The most recent megacontracts booked by the Fastening Systems and Locomotives units will in the final quarter help propel sales and earnings consistently along the path we have adopted.“ As evident from the example of China, the Group was accessing new earnings potentials through accelerated internationalization.
As announced, Vossloh will in future increasingly focus on its core businesses of rail infrastructure and rail vehicle components. These growth fields will also be expanded through takeovers. True to the policy of repositioning the Group strictly for value enhancement, Vossloh is looking in the case of Locomotives to strategic alliances. The Information Technologies division has in the wake of the portfolio focus been up for sale, a process already started.
For all of 2006 and as forecasted in H1/2006, the Group’s Executive Board has budgeted group earnings of slightly more than €35 million. Due to the separate disclosure of the IT division as discontinued operation, as required by the International Financial Reporting Standards (IFRS 5), Vossloh’s 2006 EBIT will come to around €75 million. Adjusted for Information Technologies, group sales will be in the region of €1 billion. “We are keeping word and confirming the sales and earnings forecasts announced in the first half 2006,” emphasized Dr. Eschenröder.
Important: All financial information in this press release is based on the disclosure of Vossloh Information Technologies as disposal group and discontinued operation under the terms of IFRS. As the Vossloh Group has since September 2006 used these accounting rules, the current interim report is hardly comparable with any previously published reports.
Werdohl, October 31, 2006
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