Bertrandt AG posts net profit for the year

Thursday, 16 December 2004

Strategy and organisational structure geared to future market require-ments Bertrandt AG generated a net profit for the 2003/2004 financial year in what was a difficult market for the automotive industry, consolidating its position as a leading provider of development services in Europe. The company continued to optimise its strategy and organisational structure and, as market volumes grow, plans to win market share over the medium term. Pro-active measures to secure earnings position As the 2004 market recovery keenly awaited by the industry had failed to materialise, the company had initiated a whole raft of measures to shore up its earnings position, stressed Dietmar Bichler, chairman of the company's Board of Management, at to-day's Financial Statements Press Conference in Stuttgart. These measures included adjustments to the company's portfolio of businesses, greater relocation of jobs within the organisation to improve the utilisation of resources, and the increasing use of flexible working-time models. The use of cutting-edge software tools had improved operational and project processes within the company's network. Bertrandt's customers, he continued, had responded fa-vourably to the 25.2% shareholding acquired by the industrial conglomerate ThyssenKrupp AG. He said that the two companies saw huge potential from collaborating on individual projects to develop modules and derivatives for the automotive and aviation industries. Proposal to pay a dividend of €0.15 On a total operating income of €221.3 million, which was little changed on the previous year, Bertrandt generated earnings be-fore interest and tax (EBIT) of €5.9 million. Whilst EBIT for domes-tic German operations was raised from €7.1 million to €8.9 million, EBIT for the company's international operations came to a loss of €3.0 million. These figures include restructuring costs of around €3 million. Net income for the year under review rose to €2.0 million. Based on this result, the Board of Management and Supervisory Board will propose to the company's Annual General Meeting on 16 February 2005 that a dividend of €0.15 per dividend-bearing share be paid. Robust financial structure and staff are keys to success Ralph Jacoby, the executive director responsible for finance and human resources, highlighted the fact that Bertrandt had reduced its portfolio of outstanding receivables and its financial liabilities for the third year in succession. Its equity ratio amounted to 40 per cent, which was relatively high by industry standards. Its free cash flow was again positive at €8.5 million, and capital expenditure was financed in full from its cash flow from operating activities. Jacoby stressed that one of the keys to Bertrandt's success had been the outstanding skills, expertise and dedication of its engineers. The flexible deployment of staff within its resource management system had enabled the company to retain valuable expertise inhouse. The company, he continued, had furthered its corporate strategy by investing in the ongoing training and development of its engi-neers to meet the needs of its business. Exploiting the market potential of certain businesses As part of its "Strength through Networking" project, Bertrandt had carefully analysed the future potential of its markets. According to experts, the market volume of development services in the areas of engine applications, bodywork and electrics/electronics was estimated to rise from its current level of €10 billion to roughly €15 billion by 2015. By realigning its strategy and organisational structures, Bertrandt had laid the foundations for quantitative and qualitative growth, said Bichler. The company planned to achieve abovetrend growth, increasing market share in its four potential growth businesses of drive systems, electronics, development services, and trials and testing. To this end, it had created centres of specialisation in order to pool skills and resources from across the Bertrandt Group. Should the economic outlook begin to brighten in 2005, Bertrandt believed its prospects were good.