20.09.2004 – 00:32
euro adhoc: Kaba Holding AG
significant earnings growth (E)
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Rümlang, 20 September 2004 - The Kaba Group boosted consolidated net income for financial 2003/2004 by 24.3% to CHF 56.8 million, an increase that exceeds even its own profit target. The currency-adjusted increase in sales of 2.3% during the year under review was attributable to the substantial sales gain of 5.2% in the second half of the year. Kaba has thus returned to a track of impressive growth. Despite a weak dollar, EBIT rose overproportionally by 11.2% to close at CHF 120.9 million. In the last six months of financial 2003/2004, currency-adjusted EBIT even increased by 32.4%. All divisions except Access Systems Asia Pacific were able to improve their EBIT margins in the second half-year. The reassuring results and the sustained momentum in earnings justify a proposed increase of the dividend from CHF 3.00 to CHF 4.00 per share. The General Meeting of 26 October 2004, will also be asked to elect Rolf Dörig, CEO of the Swiss Life Group, as a new member of the Board of Directors. Kaba views the current financial year with optimism and expects EBIT growth to exceed organic sales growth.
The Kaba Group profited from the rebound in the security industry, particularly in the first six months of 2004. During the first half of financial 2003/2004, sales remained stable, but in the second half of its financial year (ended 30 June 2004), the Kaba Group got back on a robust growth track with a currency-adjusted gain in sales of 5.2%. For the entire year, the currency-adjusted increase in sales was 2.3%. Expressed in Swiss francs, sales advanced by 1.8% to CHF 985.0 million.
Strong momentum in earnings EBIT rose overproportionally by 11.2% to CHF 120.9 million. At constant exchange rates, Kaba generated EBIT growth of CHF 15.6 million or 14.4% during the year under review. In the second half-year, the increase was a remarkable 32.4%. The EBIT margin rose from 11.2% in the prior year to 12.3%. The Access + Key Systems Americas Division reported a record-high EBIT margin of 20.9% for 2003/2004. In the second six-month period, all divisions except Asia Pacific (contribution to sales: 4.4%) were able to increase their EBIT margins.
Profit target exceeded Consolidated net income increased by 24.3% to CHF 56.8 million. This exceeds Kaba's self-defined profit target of CHF 54 million - communicated in autumn of 2003 - by CHF 2.8 million. The result is all the more encouraging as the currency translations mentioned above trimmed EBIT in Swiss francs by no less than CHF 3.4 million.
"The Kaba Group has demonstrated that it can rapidly transform an acceleration in demand into sales growth and, above all, into overproportional earnings growth," President and CEO Ulrich Graf said at today's media conference.
Door Systems Division stages encouraging recovery During the year under review, the Door Systems Division generated CHF 232.9 million in sales, a currency-adjusted increase of 4.5%. Absolute EBIT advanced to CHF 7.2 million, up considerably from the negative year-ago amount of CHF -1.3 million. The absolute improvement of EBIT by CHF 8.5 million increased the EBIT margin from -0.6% in the prior year to 3.1% for the report period, confirming that the in-depth restructuring of the door companies in Great Britain and Germany has had the desired effect.
Positive trend in other divisions The other divisions also picked up momentum during the year under review and reported local-currency sales growth for the second half-year. The only exception is Asia Pacific which suffered from the slow capital spending of major customers.
Reassuringly, all divisions reported positive EBIT again in financial 2003/2004. The largest single contribution to the absolute growth of the Kaba Group's EBIT was made by the Access Systems Europe Division; its EBIT rose by 38% to CHF 31.2 million. Sales jumped by 9.9% to CHF 263.8 million, and the EBIT margin picked up from 9.4% to 11.8%. In the second six-month period, all divisions increased local-currency EBIT, Swiss-franc EBIT, and the EBIT margin. Asia Pacific is again the exception because it had to absorb strategic investments in key future markets.
Board proposes higher dividend and election of Rolf Dörig as new member The Board of Directors proposes to the General Meeting of 26 October 2004, a dividend of CHF 4.00 per share. The suggested increase of the dividend by CHF 1.00 versus the prior year reflects the appraisal of the Board of Directors as regards the positive earnings trend and its firm belief that the Kaba Group will derive above-average benefit from the rebound in demand on the security market. Moreover, the Board of Directors will ask the shareholders to approve the election of Rolf Dörig, CEO of the Swiss Life Group, as a new member.
Positive outlook Since demand has picked up perceptibly in the first six months of 2004, Kaba expects business growth in financial 2004/2005 to outperform the economic growth of the markets in which it operates.
Experience suggests that Kabas organic growth entails overproportional EBIT growth; earnings growth is likely to outperform sales growth in financial 2004/2005.
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 20.09.2004
Further inquiry note: Ulrich Graf, President and CEO; Tel. +41 44 818 90 21 Dr. Werner Stadelmann, CFO; Tel. +41 44 818 90 61
Branche: Semiconductors & active components
Börsen: SWX Swiss Exchange / official dealing