Vossloh off to a good start in fiscal 2006
Q1 sales and earnings up over previous year—Strategy review underwayWithin a difficult market for the rail industry, the Vossloh Group reported for the first three months of 2006 a significant rise in sales and earnings versus Q1/2005.
Group sales improved by around 22 percent to €226.4 million, albeit the previous year’s figure did not yet include the diesel-locomotive production plant in Spain (now Vossloh España), acquired in April 2005. Adjusted for this acquisition, the sales advance was around 7 percent.
Whereas still poor spending propensity on the part of German rail operators again squeezed domestic sales, Vossloh managed to show gains in France and elsewhere in Europe. The higher business volume in France was also the outcome of publicsector subsidies for (sub)urban rail transport systems.
Group EBIT mounted a good 8 percent to €12.0 million, group earnings surged by just under 43 percent to €5.0 million. This latter was the combined outcome of a higher EBIT, net interest expense slashed by 19 percent or €0.9 million, and the absence of burdens from meanwhile discontinued operations.
At €135.2 million, the Rail Infrastructure division’s Q1/2006 sales were 6.8 percent up over the year-earlier level. EBIT slipped by €2.4 million to €15.5 million, chiefly due to a market-related much higher share of lower-margin business.
Sales at the Motive Power division in Q1/2006 totaled €85.2 million. Even on a like-for-like basis—when deducting the €28.6 million contributed by Vossloh España—the division still upgraded its performance by 8.4 percent from the year-earlier €52.2 million. EBIT advanced by €7.3 million, from a red €3.8 million in Q1/2005 to a black €3.5 million.
This improvement was due to the Electrical Systems business unit’s much better EBIT and the input from Vossloh España. Q1/2005 earnings had also been depressed by the one-time burdens of restructuring the Kiel location.
Sales by the Information Technologies division at €5.9 million fell slightly short of the year-earlier €6.7 million. Extra costs and expenses entailed by various projects (in the region of €1.5 million) worsened the negative EBIT for Q1, from €0.7 million a year ago to €2.3 million this year.
At March 31, 2006, the Vossloh Group employed a worldwide work-force of 4,948, up by 528 or 11.9 percent from March 31, 2005. The added employees at the Rail Infrastructure division were chiefly the result of the initial consolidation of Vossloh Switch Systems’ India-based Beekay Engineering.
As announced at the Annual Accounts Press Conference in March, over the coming months Vossloh Management will thoroughly and purposefully review both its strategic and its operational options in order to expand Vossloh’s excellent position in the transport technology market. The first deliverables are expected in early fall of this year.
Werdohl, April 27, 2006
Contact:
Christiane Konrad, Vossloh AG, phone: (+49-2392) 52-249
Email: christiane.konrad@ag.vossloh.com