Wienerberger Records More Profits, but Less than Expected

Published: November 3, 2010; 15:40 · (Vindobona)

Wienerberger AG recorded a 7% year-on-year increase in operating EBITDA to € 82.2 million for the third quarter of 2010. However, analysts expected even more.

Wienerberger Records More Profits, but Less than Expected / Picture: © Wienerberger

This increase in operating profits was based on the restructuring measures implemented in 2009. Wienerberger generated revenues of € 517.7 million (2009: € 518.5 million) for the period from July to September.

Revenues for the first three quarters of 2010 amounted to € 1,343.3 million (-5%) and earnings equaled € 160.5 million (-10%), which represents a further offset of the negative earnings recorded for the first quarter. “

“We were able to reduce gearing to only 15% by September”, explained Heimo Scheuch. Net debt decreased from € 484.8 million on June 30, 2010 to € 389.9 million; these figures include the bond that was issued at the beginning of April 2010. The proceeds from the new bond were used to reduce refinancing requirements and to further improve the term structure of the Group’s liabilities. Approximately € 140 million of the 2005 bond that is due in April 2012 were repurchased, and part of the remaining funds was also used to repay other financial liabilities.

Gross cash flow totaled € 141.1 million, which represents a sound increase of € 67.1 million over the first nine months of the previous year. This improvement reflected the positive effects of the fixed cost reduction program as well as the absence of restructuring costs.

“We intend to strengthen and further expand the leading role of Wienerberger. Accordingly, our strategic goal is to expand the Group’s core business and to make meaningful additions to the existing product portfolio”, indicated Heimo Scheuch.

“I expect a continuation of the individual market trends up to the end of the reporting year. In Central-East Europe, I do not foresee any notable improvement in the construction sector. Central-West Europe should see a continuation of the modest recovery in Germany at a very low level. Developments should be positive in Great Britain and France, and stable in Belgium. In the USA, I do not anticipate any significant changes in this market, in particular because of the recently held congressional elections. I believe that the building materials sector will again be faced with a variety of challenges during the coming year. The decisive factor will be the development of consumer confidence in spite of the announced government spending cuts, uncertain economic development and high unemployment. Nevertheless, I view the future of Wienerberger with optimism because we have well positioned our cost structure and our products in the market. With our strategy to become a full-range system provider, as well as a clear focus on product innovation, we are well-equipped for the economic recovery”, emphasized Heimo Scheuch in conclusion.