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| Zumtobel announces 2008 first half-year results The Austrian Zumtobel Group, which is headquartered in Dornbirn / Vorarlberg, recorded stable operating development for the first half of the 2008/09 financial year (May to October): Group revenues nearly matched the comparative prior year level in spite of negative foreign exchange effects, but the strong Euro led to a nominal decrease of 3.7% in revenues to EUR 641.1 million (prior year: EUR 666.1 million). The increasing strength of the Euro, in particular with respect to the British Pound, was responsible for negative effects of EUR 23.4 million. An analysis by quarter shows the first consequences of the global economic crisis with a decline of 5.4% during the second three months of the current financial year (August to October). The Zumtobel Group recorded adjusted earnings before interest and tax (EBIT) of EUR 60.1 million for the first six months of 2008/09, for a decline of 20.7% versus the comparable prior year level of EUR 75.7 million. The group was unable to match the high prior year return on sales, but the EBIT margin of 9.4% can be considered satisfactory under the current difficult market conditions. The decrease in earnings resulted primarily from a lower contribution due to the decline in revenues, higher personnel expenses that followed changes in collective bargaining agreements, higher costs for the expansion of LED activities and negative foreign currency effects. Profit for the period totalled EUR 42.1 million – despite a significant improvement in financial results that was supported by valuation effects – for a decline of 23.5% from the comparable prior year value of EUR 55.1 million. The Management Board expects a further deterioration in the economic climate during the 2009 calendar year. Zumtobel has launched an efficiency improvement programme. These measures should lead to a sustainable reduction of roughly EUR 50 million in personnel and operating costs by the end of the 2010/11 financial year. Based on the current negative economic trends and the fact that the major part of these cost savings will only provide relief for earnings beginning in 2009/10, the goal to record an EBIT margin of 8 to 9% for 2008/09 no longer appears realistic. write your comments about the article :: © 2008 Construction News :: home page |