Measures to increase earnings show positive effects

Thursday, 18 December 2003

In spite of persistently difficult market conditions in the automotive industry, Bertrandt AG achieved a good result in fiscal 2002/2003. Its Board of Management and Supervisory Board will therefore propose to the AGM on 18 February 2004 that the company pay a dividend of EUR 0.15 per dividend-bearing share. In the last twelve months the company responded to growing demands in the projects field by implementing the Bertrandt Engineering Network. The more intensive networking of available expertise is intended to add value for customers and lay the foundations for the continued sound growth of the company. Strong earnings in the fourth quarter Bertrandt AG was affected by the difficult economic climate in fiscal 2002/2003. At today's presentation of the company's annual financial statements in Stuttgart, Dietmar Bichler, Chairman of the Board of Management, emphasised that a mixed project landscape had led the company to act to increase its earnings. This had shown perceptible effects in the fourth quarter, the year's strongest in terms of earnings (EUR 2.9 million). On a total operating performance of EUR 226.9 million, he said, earnings before interest and tax (EBIT) were EUR 6.1 million. This was depressed by restructuring costs at individual facilities and by extraordinary project-related expenditure at subsidiary ZR - Zapadtka + Ritter GmbH & Co. KG, which totalled EUR 3.0 million. Abroad, good progress in France had vindicated the reorganisation of previous years. The performance of sites in Sweden and the UK had been depressed by difficult market conditions. Following losses in previous years, Spain had broken even - while the first projects in the US were under way. Improvements in key performance indicators Against the backdrop of growing requirements in the financial markets (ratings and Basle II), Ralph Jacoby, Executive Director for Finance and Human Resources, highlighted the improvements in key performance indicators (IAS) achieved by the company's long-term financial policy. This had made it possible to maintain a consistent dividend policy. In the year under review borrowings had been reduced by a total of EUR 11.3 million, while the capital ratio had been increased to 38 per cent. Training and development of staff continued Jacoby stressed that the technical expertise and personal qualifications of the staff play key roles in project implementation, and Bertrandt had therefore continued to provide ongoing training and development for staff despite the persistence of poor market conditions. The company-wide resource management system would be expanded, ensuring that engineers engaged in project work would be managed in line with the needs of customers and the company as a whole. Trend towards greater model proliferation confirmed at the IAA At the Frankfurt International Motor Show (IAA) manufacturers had confirmed the trend towards increasing model proliferation and shorter development periods, said Bichler. The continuation of the company's niche policy, the satisfaction of individual consumer preferences and the use of innovative materials meant that there were good future prospects in the market for development services. Positive response to the Bertrandt Engineering Network Bichler emphasised that greater complexity in project implementation was increasingly demanding the ability to control and integrate internal and external processes. The company had responded to this by more systematically networking the expertise available throughout the Group. In the course of implementing the Bertrandt Engineering Network, the range of services offered by the company had been classified into four categories: development services, specialist topics, module development and fully-integrated vehicle derivatives. Customer responses to this strategy at the IAA had been positive. Consolidating the company's position as a leading development partner Experts regard the market for development services as a growing segment of the international automotive industry. Although the outlook for 2004 in the automotive sector as a whole was cautiously optimistic, there was no expectation of a rapid recovery in the difficult prevailing circumstances. The company's business model meant that it was well-placed in the market, said Bichler. The range of services it offered highlighted its customer orientation, and it was tackling the challenges of fiscal 2003/2004. In this, the thirtieth year since the company's foundation in 1974, it would exploit the outsourcing potential available in the market to consolidate its position as one of the leading development partners in the international automotive industry.