Beru Sales, Profits Down

In the first nine months of 2008 the Beru Group posted revenue of 324.2 million euros, a decrease of 2.2 per cent of the corresponding period of the previous year. Profit from ordinary activities (EBIT) amounted 18.8 million euros, equivalent to an EBIT margin of 5.8 per cent. In 2007 this figure and margin were 34.2 million euros and 10.3 per cent respectively. This includes one-time special items, which reduced EBIT by approximately EUR 9.8 million. Excluding those special items, adjusted EBIT amounted to EUR 28.6 million, equivalent to an adjusted margin of 8.8 per cent per cent.

The Aftermarket business continued its positive development in the first nine months of 2008 and generated revenue of 89.1 million euros, representing growth of 4.1 per cent compared with the prior-year period. In the area of Original Equipment, however, there was a significant impact from the financial crisis and resultant cuts in production initiated by vehicle manufacturers. Beru posted significantly lower revenue in this segment during the third quarter. The drop in revenue was also the result of pressure on prices and an intensely competitive situation, says Beru. Revenue in the first nine months of the year thus decreased to 215.3 million euros. Another reduction seems likely in the fourth quarter, the company adds.

Due to the worsening financial market crisis and the resulting sales crisis in the automotive industry, Beru states it has decided to take various measures to counteract declining production volumes. These measures include an extended plant shut down over the Christmas period, the reduction of vacation days and of hours accumulated on flexitime accounts by the end of the year, and reduced weekly working times for all employees as of January 2009. These measures will initially be in force until the end of March 2009.

The Beru Executive Board does not expect the sales crisis in the automotive industry to improve in the short term. “The situation in the automobile industry has exacerbated dramatically,” stated Executive Board chairman Dr. Thomas Waldhier. “We will therefore not achieve our previous forecasts for revenue and earnings in full-year 2008, and anticipate weak demand also in the year 2009.” Beru now anticipates 2008 full-year revenue of between 405 million and 415 million euros, and EBIT adjusted for special items of between 30 million and 35 million euros. However, Waldhier believes that the actions that have been decided upon leave Beru well placed to react flexibly to future developments: “As soon as the order situation improves, we will be able to increase our production again. In addition, Beru has well positioned business operations and a strong and healthy financial base.”