euro adhoc: CHRIST WATER TECHNOLOGY AG
Financial Figures/Balance Sheet /
Continuous growth in all important areas
Disclosure announcement transmitted by euro adhoc. The issuer is responsible for the content of this announcement.
20.11.2006
Order intake: +4% to EUR 179.6 million Orders on hand: +31% to EUR 175.0 million Sales: +17% to EUR 151.1 million EBIT: +220% EUR 4.8 million
"The third quarter confirmed the sustained upturn in the Christ Group. With the acquisitions Innoterv, KF and the increase in the strategically important Indian Joint Venture Nishotech and the strong earnings improvement in the Ultrapure Water division we are on track for 2006 while creating further opportunities for 2007," says Karl Michael Millauer, CEO of the Christ Water Technology Group.
Order receipts showed an improvement on the prior years record figure (EUR 173.5 million) and now stand at EUR 179.6 million. The highest growth rates were posted by the Food & Beverage segment (+76%), which in addition to the organic growth at Van der Molen also includes the newly acquired KF Service for the first time. Pharma & Life Science (+12%) also benefited from the buoyant investment mood around the world in the pharmaceutical and biotechnology industry. The growth experienced by the Municipal Water Treatment segment (+25%) resulted primarily from the initial consolidation as per 1 July of the Hungarian company Innoterv RT, part of the Aqua Engineering Group. In the microelectronics sector of the Ultrapure Water segment, the concentration on qualitative growth has resulted in reduced order receipts (-25% to last year). New orders in the investment-friendly power plant business provided an effective cushion against the impact of the resulting decline. The order book reached an excellent EUR 175.0 million (prior year: EUR 133.6 million) at September 30.
After the first three quarters, consolidated Group sales were running at EUR 151.1 million and thus + EUR 21.6 million to prior year (EUR 129.5 million).
Sales (EUR 1000s) 1 - 9 / 2006 1 - 9 / 2005 + / - % Pharma & Life Science 34,734 31,867 +9.0% Ultrapure Water 71,414 54,452 +31.2% Food & Beverage 16,202 16,165 +0.2% Municipal Water Treatment 28,701 26,996 +6.3% Total 151,051 129,480 +16.7%
In the Pharma & Life Science segment, the growth in sales slowed to 9% due to project deferments in North and South America and in Ireland. The business conditions remain good and the order structure is characterized by a majority of medium size orders after the completion of a major pharmaceutical project.
Sales in the Ultrapure Water segment displayed the largest increase with a rise of 31% and these were distributed over the microelectronics sector, flourishing in Asia especially, current power plant projects in Europe and in the Middle East, and industrial process and wastewater treatment solutions.
The Food & Beverage segment is continuing along its road to consolidation and with Van der Molen has succeeded in finally resolving the projects associated with weak sales and in turning around earnings with new order qualities. The 51% participation in aseptic specialists KF Service has been included for the first time from the third quarter.
Sales in the Municipal Water Treatment segment also increased steadily and this reflects the high level of demand worldwide for both clean drinking water and municipal wastewater treatment. Due to cooperation with, and subsequent acquisition of, the Hungarian wastewater specialists Innoterv, we have succeeded in obtaining further interesting municipal projects in Hungary.
Sales in the service business increased year-on-year by 26% to EUR 24 million (prior year: EUR 19 million). The proportion of sales thus increased in percentage terms to 16%.
The third quarter closed with an accumulated operating profit (EBIT) of EUR 4.8 million (prior year: EUR 1.5 million) and an EBIT margin of 3.2% (prior year: 1.1%) and confirmed the sustained income improvement in the Group.
EBIT (EUR 1000s) 1 - 9 / 2006 1 - 9 / 2005 + / - % Pharma & Life Science 971 621 +56.4% Ultrapure Water 3,460 289 +1097.2% Food & Beverage -840 -786 - Municipal Water Treatment 1,258 1,353 -7.0% Total 4,849 1,477 +228.3% Investments in market expansion (mainly the USA, China and India) with associated negative earnings contributions have impaired the positive primary business in the Pharma & Life Science segment in the third quarter. This resulted in the accumulated EBIT margin falling to 2.8%. A healthy level of orders on hand and promising quote volumes in all sites should result in improved income in the last quarter. Earnings in the third quarter supported the healthy condition of the Ultrapure Water segment. The accumulated EBIT margin was 4.8% (prior year: 0.5%). The fact that all the companies included in the segment are working positively and there is no dependency on major individual projects or sectors, points to continued stable development. The negative earnings for the Food & Beverage segment in the third quarter were the result of start-up losses of the new acquisition KF Service in the course of processing old orders as well as from project preproduction costs. EBIT for Van der Molen was already positive in the third quarter and validates the restructuring approach. Both companies forecast improvements in earnings for the fourth quarter. After decreases in earnings with major projects in the prior quarter caused by settlements, earnings for the Municipal Water Treatment segment recovered in the third quarter. The company sites in South Africa and Dubai improved as did the site in Hungary, where the joint appearance of Aqua Engineering and Innoterv on the market has already resulted in positive earnings contributions.
Earnings before tax increased to EUR 3.5 million (prior year: EUR 0.5 million). The profit for the period after taxes on income rose from EUR 0.4 million in the prior year to EUR 2.4 million. Minority shares produced a negative amount from the loss allocation to KF Service. This resulted in the profit for the period for the shareholders of Christ increasing to EUR 2.6 million.
The balance sheet total increased in proportion to the expansion of the volume of business from EUR 144.4 million to EUR 162.2 million. Group equity (including minority shares) increased from EUR 41.2 million, as of 31 December 2005, to EUR 42.5 million. The equity ratio decreased from 28.5% to 26.2% due to the increased balance sheet total. Net debt has risen from EUR 20.4 million, as of 31 December 2005, to EUR 34 million.
The third quarter was characterized by the finalization and integration of company acquisitions as well as setting the future course, in operating terms, of current loss-making subsidiaries. The positive momentum is already beginning to be reflected in improved earnings in the fourth quarter.
In order to increase attractiveness for the share for US investors management plans to launch an ADR (American Depository Receipt)-Programme, Level 1, to be implemented over the next few weeks.
Outlook
The obtaining of attractive orders in all segments as early as the start of the final quarter has laid the foundation for promising annual financial statements. Based on the good order situation in all sectors and the continuing favorable economic climate for the 2006 financial year, the management is still assuming that sales will pass the EUR 200 million mark and the EBIT margin will continue to improve.
end of announcement euro adhoc 20.11.2006 07:30:00
Further inquiry note:
CHRIST WATER TECHNOLOGY Group
Ralf Burchert, CEFA
ralf.burchert@christwater.com
P. +43 6232/5011-1113
Branche: Biotechnology
ISIN: AT0000499157
WKN: 675399
Index: WBI, ATX Prime
Börsen: Wiener Börse AG / official market