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euro adhoc: SW Umwelttechnik Stoiser & Wolschner AG / Quarterly or Semiannual Financial Statements / SW Umwelttechnik unveils results für first three quarters of 2003 (E)

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  • Strong third quarter brings 14% revenue growth
  • EBIT up due to robust demand for products of Infrastructure sector in Hungary
  • Croatia, Romania, Slovakia and Slovenia generated 4% of revenue

SW Umwelttechnik posted a 22% year-on-year gain in revenue from EUR 21 million (m) to EUR 25.6m in the third quarter of 2003. Over the first three quarters revenue advanced by 14%, from EUR 48.6m to EUR 55.3m. This improvement was driven by further inroads in the Hungarian market, which more than compensated for contracting Austrian and German demand. Hungarian sales as a proportion of overall revenue rose from 60% to 68%, while Austrian sales shrank from 32% to 23%, and those to other EU member states from 7% to 5% of the total. Concerted marketing drives lifted the joint contribution of Croatia, Romania, Slovakia and Slovenia from 1% to 4%.

Due to their strong performance in Hungary the revenue contributions of SW Umwelttechnik’s Infrastructure and Engineering business sectors expanded from 33% to 36%, and from 29% to 34%, respectively. That of the Water Conservation sector fell from 39% to 30% owing to the difficult trading environment in Austria and Germany.

Due to the strong third quarter, earnings before interest and tax (EBIT) for the first three quarters also progressed, rising by 55% to EUR 1.9m (Q1-Q3 2002: EUR 1.2m) and thereby making up the ground lost in the first half of the year. The recovery in EBIT would have been still more impressive had it not been for the cost of closing the German site (EUR 0.5m) and the weakness of the Austrian market. These factors caused EBITDA to dip from EUR 5.5m to EUR 4.8m.

Finance cost climbed from EUR 0.3m to EUR 2.0m. This reflected exchange losses relating to the euro denominated financing of some Hungarian investments, and the effect of the EUR 0.8m proceeds of the disposal of a minority interest in a Hungarian company in the like period of 2002. The deterioration in finance cost led to a loss on ordinary activities of EUR 0.1m, compared to a profit of EUR 0.9m in the third quarter of 2002.

Despite the growth in revenue the company’s head count was almost unchanged at 779 as of 30 September (previous year: 785).

Capital expenditure

EUR 4,1m of SW Umwelttechnik’s EUR 4.5m annual investment budget was spent in the first three quarters of 2003.

The main focus of investment activity was Hungary, to which 76% of all capital expenditure was channelled. Much of the money went to ramping up production at the new factory to the south of Budapest.

Strategy and outlook

In the light of the strong third quarter management anticipates year-on-year improvements in revenue and earnings for 2003 as a whole. However the increased finance cost due to the devaluation of the forint against the euro, and the expenses arising from the German plant closure will result in slightly negative earnings per share.

SW Umwelttechnik will continue to push ahead with its Central Europe expansion strategy. The following factors are likely to colour the medium-term outlook:

* Public spending cuts in Hungary due to the high budget deficit are resulting in the postponement of major environmental investments. However the government remains committed to complying with EU environmental standards in the medium term, which is a clear condition of accession. The fall in order backlog from EUR 28m to EUR 21m chiefly reflects lower order bookings by the Engineering sector in Hungary.

* As the Infrastructure sector does not depend on public finance it is not affected by the budget restrictions, and is continuing to profit from the construction boom in Hungary. Thanks to the new south Budapest works the company is well placed to meet the growing demand for the infrastructure products.

* In Austria SW Umwelttechnik’s standard products are likely to continue to suffer from the present harsh trading conditions. However new products such as biogas plants, spun concrete masts and surface water protection systems mean that SW Umwelttechnik is not entirely at their mercy.

* SW Umwelttechnik will continue to use its existing production facilities in Croatia, Romania, Slovakia and Slovenia as a platform for sales growth, and is working to develop these markets.

Further inquiry note:
DI Heinz Wolschner, Vorstand der SW Umwelttechnik
Tel.: 0043/463/32109-0, Fax: 0043/463/37667
MMag. Christian Riel, Finanzen/Investor Relations
Tel.: 0043/664/4337105, Fax: 0043/1/3688686, christian.riel@sw-umwelttechnik.at
Website: http://www.sw-umwelttechnik.at
Tel: 0043-463-32109
FAX: 0043-463-37667
Email: office@sw-umwelttechnik.at

Emittent: SW Umwelttechnik Stoiser & Wolschner AG Bahnstraße 87-93 AT-A-9020 Klagenfurt Tel: 0043-463-32109 FAX: 0043-463-37667 Email: office@sw-umwelttechnik.at WWW: http://www.sw-umwelttechnik.at ISIN: AT0000808209 WKN: 080820 Indizes: ATX Prime, ViDX, WBI Börsen: official dealing Wiener Börse AG; free trade Berliner

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Wertpapierbörse, Börse Düsseldorf, Baden-Württembergische Wertpapierbörse
Branche: Technology
Sprache: Englisch