Ad-hoc | 15 November 1999 07:47

Ad hoc-Service: SW Umwelttechnik 3rd Quarter

Ad-hoc Mitteilung übermittelt durch die DGAP. Für den Inhalt der Mitteilung ist allein der Emittent verantwortlich. —————————————————————————— Press release, 15 November 1999 SW Umwelttechnik report for first three quarters of 1999 Unchanged earnings and high order books SW Umwelttechnik Stoiser & Wolschner AG is continuing with its acquisition strategy, and recently took over Hungary’s Strong Kft. Strong order books at the end of 1999 – ATS 400 million (EUR 29.07 mn) – herald a significant increase in earnings in the year 2000. The operating result will remain at last year’s level despite order postponements in Austria and Hungary affecting the environmental technology and engineering sector. Turnover and profits During the first three quarters of 1999 the business environment faced by SW Umwelttechnik was marked by: . Delays in orders for decentralized wastewater treatment plants in Austria, due to the extension of deadlines for compliance with the EU wastewater treatment directive; . Order postponements in Hungary due to changes in guidelines for environmental project finance after the elections; . Redirection of funds for infrastructural projects in Hungary to reconstruction following severe flood damage in the first half of 1999; . Increased demand from industrial construction projects in Hungary and Austria. Despite the difficult market situation, the Company increased its turnover by 4%, from ATS 354.8 mn (EUR 25.78 mn) to ATS 369.2 mn (EUR 26.83 mn), in the first three quarters of 1999. The business climate is reflected in the breakdown of turnover by core sectors and countries – particularly as regards the environmental technology and engineering sector in Hungary. The proportion of total turnover generated in Hungary fell to 45% (1998: 54%), while that accounted for by Austria rose to 49% (1998: 42%), and the EU and other countries were responsible for the remaining 7%. The environmental technology and engineering sector’s share of turnover fell to 30% (1998: 39%), and that of the environmental products sector rose to 43% (1998: 39%), while that of building products was up to 27% (1998: 20%). Earnings before tax and interest (EBIT) were also affected. Contrary to expectations of a significant increase in 1999, at ATS 24.2 mn (EUR 1.76 mn) EBIT was only marginally up on the like period of the previous year when it stood at ATS 23.9 mn (EUR 1.76 mn). As expected, the profit on ordinary activities (POA) fell from ATS 37.8 mn (EUR 2.75 mn) to ATS 25.5 mn (EUR 1.85 mn). However, it should be noted that the 1998 figure reflects the disposal of a non-core operation. ATS MN EUR MN Q1-Q3 Q1-Q3 Q1-Q3 Q1-Q3 Q1-Q3 Q1-Q3 CH ’97 ’98 ’99* ’97 ’98 ’99* 98/99 Turnover248.0 354.8 369.2 18.02 25.78 26.83 +4,1% Output 260.5 408.2 403.3 18.93 29.67 29.31 -1,2% EBIT 21.1 23.9 24.2 1.53 1.74 1.76 +1,3% POA 21.9 37.8 25.5 1.59 2.75 1.85 -32,5% Payroll 436 499 975 – – – +95,4% 30.9. * Strong Kft was included in the consolidated Group in August 1999 Acquisitions In August 1999 SW Umwelttechnik took over Strong Kft., Hungary, which it now wholly owns. Strong Kft has the largest precast concrete section factory in eastern Hungary and is one of the region’s leading specialist manufacturers of prefabricated concrete elements for halls, housing, traffic control and power masts. In the next 12 months a comprehensive restructuring programme will bring sustained savings in consumption of energy and materials, and in the Strong’s wage bill. In order to exploit the synergies between Strong and another SW Umwelttechnik subsidiary, Mibet Kft – previously strong competitors – overlap between production operations and sales territories will be eliminated, holding out the prospect of improved earnings, even in the short run. The two companies are to be merged to form “Strong & Mibet Kft” on 1 January 2000. Outlook The current market situation means that turnover is likely to register year-on-year growth of only about 10% in 1999 as a whole. However, turnover growth is expected to rebound to at least 25% in the year 2000. Order books are likely to stand at ATS 400 mn (EUR 29.07 mn) by the end of 1999 – almost twice the ATS 210 mn (EUR 15.26 mn) recorded at the end of 1998. Because of this year’s order postponements the Company’s aim of a significant improvement in EBIT will not be achieved until the year 2000. The following factors should ensure that SW Umwelttechnik continues to grow in the medium term: . Environmental investments have been put off in 1999, but are unavoidable for candidates for EU accession. Hungary plans a renewed municipal wastewater treatment investment drive in 2000. . Innovative environmental products filling promising niches (e.g. retrofitting kits for existing small-scale wastewater treatment plants) will bring growth even in saturated markets. . Thanks to its strong equity base the Company will be able continue to go ahead with its successful policy of making acquisitions in core areas of business. Contacts Bernd Wolschner, member of the Management Board of SW Umwelttechnik Tel: (+43 7259) 3135; fax: (+43 7259) 31356 Christian Riel, Investor Relations Tel: (+43 463) 321 09 ext. 23; fax: (+43 463) 37 6 67; e-mail: sw_rch@magnet.at Website: www.sw-umwelttechnik.at Ende der Mitteilung