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euro adhoc: Kaba Holding AG
Quarterly or Semiannual Financial
Kaba holds EBIT and profit margins (E)
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Rümlang, 8 March 2004 - In the first six months of financial 2003/04, the Kaba Groups sales eased by 1.6% to CHF 482.4 million. Compared to the prior-year period, EBIT slipped by 3.5% to CHF 57.9 million and consolidated net income by 2% to CHF 26.2 million. The decline mainly reflects the depreciation of the US dollar versus the Swiss franc. Considering the sustained weakness of the economy, the Kaba Group performed well in terms of operating profitability. EBIT and profit margins remained close to prior-year levels. With an EBIT of CHF 4.4 million, the Door Systems Division achieved significant progress. Consolidated operating cash flow closed at a reassuring level of CHF 56.5 million, and net debt was trimmed by CHF 35.7 million. Despite some positive signs on the horizon, Kaba is not yet expecting an imminent reversal toward a clear growth trend.
The slight decline in sales by 1.6% to CHF 482.4 million reflects the depreciation of the US dollar versus the Swiss franc but is also a consequence of the sustained sluggishness of the economy. Comparable currency-adjusted sales for the period declined only by CHF 2.7 million or 0.6%. The firm Swiss franc had an impact on foreign-currency sales with a translation loss of CHF 5.0 million or 1.0%.
EBIT slipped from CHF 60.0 million to CHF 57.9 million due to the currency developments. The EBIT margin (operating profit in % of operating revenues) closed at 11.8%, near the prior-year level of 12.0%. At constant exchange rates, EBIT (CHF 59.8 million versus CHF 60.0 million a year ago) remained virtually unchanged. Although the Door Systems and Access Systems Europe Divisions have made the anticipated progress in operating profitability, reported half-year net income of CHF 26.2 million falls slightly short of the prior-period result (CHF 26.8 million).
Operating cash flow generated in the period under review closed at CHF 56.5 million (previous half-year CHF 65.3 million), remaining at an encouragingly high level. Kaba again managed to significantly and swiftly reduce net debt. As at 31 December 2003, debt amounted to CHF 394.8 million, CHF 35.7 million less than a year ago. This level is appropriate for a company the size of Kaba.
Mixed effects of dollar weakness on divisional results The Door Systems Division posted CHF 4.4 million in EBIT (previous year CHF 0.7 million) and is on the way to reaffirming itself as a predictable mainstay of the Kaba Group in terms of revenues and earnings. Local-currency sales picked up by 3.2%.
The Data Collection Division - it comprises the business operations of Kaba Benzing - had to absorb an 8.5% decline in local-currency sales. The EBIT margin dipped from 17.1% to a still respectable 14.4%. Business clearly began to pick up in the last months of the period under review.
The Access Systems Divisions, which comprise the mechanical and mechatronic locking systems as well as electronic access control in separate regions, were able to hold their local-currency sales steady. At constant exchange rates, EBIT would have advanced by 3%. The EBIT margin increased from 15.2% in the same prior-year period to 15.3%. Sales of the Access and Key Systems Americas Division, which also contains the key duplication business in the Americas, dropped to CHF 133.4 million, corresponding to a decline of CHF 18.5 million. Approx. 60% of this amount was due to currency translation. Access and Key Systems Americas is the largest unit of the Kaba Group and accounts for 28% of consolidated sales and 43% of consolidated EBIT.
The Key Systems Europe Division had to take cuts in both sales and EBIT. The depreciation of the dollar versus the prior-year period is responsible for about half of the decline.
Although there are some positive signs of a recovery, Kaba does not foresee a broad-scale business uptrend ahead for the security industry. However, the Kaba Group is superbly positioned to sustainably benefit from a global upswing in the security industry as soon as it emerges.
A telephone conference in English will take place on Monday, 8 March 2004, at 4:30 PM CET (10:30 AM EDT; 07:30 AM PDT). To participate, please register via www.kaba.com/pw/konferenz-e.html before 3:30 PM CET.
CET = Central European Time / EDT = Eastern Daylight Time / PDT = Pacific Daylight Time
Kaba is a globally active, publicly traded security corporation. With its «Total Access» strategy, the Kaba Group is specialized in integrated solutions for security, organization, and convenience at building and information access points. Kaba is also the world markets No. 1 provider of key blanks, key cutting and coding machines, transponder keys, and high security locks. It is a leading provider of electronic access systems, locks, master key systems, hotel locking systems, security doors, and automatic doors. Further information is available at www.kaba.com
This communication contains certain forward-looking statements including statements using the words "believes", "assumes", "expects" or formulations of a similar kind. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which could lead to substantial differences between the actual future results, the financial situation, the development or performance of the Company and those either expressed or implied by such statements. Such factors include, among other things: competition from other companies, the effects and risks of new technologies, the Company's continuing capital requirements, financing costs, delays in the integration of acquisitions, changes in the operating expenses, the Company's ability to recruit and retain qualified employees, unfavorable changes to the applicable tax laws, and other factors identified in this communication. In view of these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. The Company accepts no obligation to continue to report or update such forward-looking statements or adjust them to future events or developments.
end of announcement euro adhoc 07.03.2004
Further inquiry note: Ulrich Graf, President and CEO; Tel. +41 1 818 90 21 Dr. Werner Stadelmann, CFO; Tel. +41 1 818 90 61
Branche: Semiconductors & active components
Börsen: SWX Swiss Exchange / official dealing