sales - AS Création Tapeten AG

PRESENTATION A.S. CRÉATION TAPETEN AG
(May 2007)
1

LEGAL DISCLAIMER
The information in this company presentation contains forward-looking statements which reflect the
current position of the management of A.S. Création Tapeten AG regarding possible future events and are
based exclusively on currently available information and a number of assumptions made by management
of A.S. Création Tapeten AG that may or may not prove to be appropriate. Where such statements refer to
the future, they involve known and unknown risks, uncertainties and other factors that could cause the
actual results, financial position, development or performance of A.S. Création Tapeten AG (including
related companies) or of the industries and markets to which such a forward-looking statement refers to
differ materially from those expressly or implicitly assumed in such statements. However, it should be
noted that A.S. Création Tapeten AG is not obliged to update the forward-looking statements contained in
this presentation and to adopt them to reflect future events or developments.
In the UK this presentation is intended for distribution only to persons of a kind described in article 11(3)
(other than 11(3)(c)) of the financial services act 1986 (investment advertisements) (exemptions) order 1996
(as amended). Neither this presentation nor any copy of it may be sent to or taken into the United States of
America, Canada or Japan, nor may it be distributed to any us person (within the meaning of regulations
under the US Securities Act of 1933). By accepting this presentation you agree to be bound by the
restrictions set forth above.
2

COMPANY AND SECTOR ENVIRONMENT
3

A.S. CRÉATION AT A GLANCE
� A.S. Création comprises 2 divisions:
• Wallpaper (production)
• Furnishing Fabrics (trade)
� A.S. Création is the leading wallpaper manufacturer in Germany
• range: approx. 6,000 different wallcovering items
• production: approx. 32 million rolls p.a.
• stock: approx. 9 million rolls
• market share 2005: 32% of the sales of the German wallpaper
manufacturers
� Trading with furnishing fabrics
• complementary product (interior decoration)
• forward-looking trend analysis (colour and design trends)
4

FISCAL YEAR 2006 AT A GLANCE
2004 2005 2006
€ m € m € m
Sales 132.1 145.3 152.4 + 4.9%
Earnings before taxes 11.0 13.0 12.7 - 2.4%
Return on Sales (before taxes) 8.3% 8.9% 8.3%
Net profit 6.6 7.7 10.2 + 31.4%
Return on Sales (after taxes) 5.0% 5.3% 6.7%
In 2006 A.S. Création generated the highest sales and net profit in its
history. Earnings before taxes is slightly below previous year‘s level
5

ORGANIZATIONAL STRUCTURE
100%
AS Creation (UK) Ltd.
Formby/UK
A.S. Création (France) SAS
Lyon/France
A.S. Création Tapeten AG
Gummersbach/Germany
100% 100%
A.S. Création (NL) B.V.
Werkendam/NL
Two Divisions:
• Wallpaper (approx. 90 % of Group sales)
• Furnishing Fabrics (approx. 10 % of Group sales)
100%
100%
100%
A.S. Création Textil GmbH
Gummersbach/Germany
Indes Wohntextil GmbH
Gummersbach/Germany
FUGGERHAUS Stoffe GmbH
Gummersbach/Germany
6

WALLPAPER AND FABRICS ARE FASHION
7

Market segment
THE BRANDS
upper
middle
lower
Wallpaper Furnishing Fabrics
Division
8

FACTORS FOR SUCCESS
� Design and colours
� Wallpaper and fabrics are fashion and lifestye products
• identification of design and colour trends
• innovation
• product range
� Services
� Competitive advantages due to better services
• product availability and fast delivery time
• logistics
• powerful marketing strategies for the PoS
• „consulting/advice“ with regard to wallpaper
• store fittings (esp. for DIY customers )
Superior design and better services allow for higher average
selling prices.
9

BREAKDOWN OF SALES
5 %
24 %
European Union
Gross sales by regions
2005 2006
71 %
27 %
67 %
With 67% of consolidated sales the European Union remains the
most important market for A.S. Création by far. The region with the
most dynamic growth in 2006 was Eastern Europe
6 %
Other Eastern Europe Other Countries
10

COMPETITORS – SALES VOLUMES
� A.S. Création € 152 m
� Rasch GmbH & Co. KG, Germany € 133 m
� Graham & Brown Ltd., UK € 90 m
� Balta-Group, Belgium (Division wallpaper) € 70 m
� Erismann & Cie. GmbH Tapetenfabrik, Germany € 65 m
� Marburger Tapetenfabrik GmbH & Co. KG, Germany € 60 m
� Ugépa/Lutece/Montecollino, France € 55 m
(Sales are not purely due to wallpaper activities; sources: annual reports, other companies‘
information and own estimates)
11

MARKET TRENDS
� Ongoing consolidation process (national and international)
� Increasing importance of big customers/key accounts
• big customers are looking for long-term partnerships
− strong financial position
− innovation (assortment and marketing)
• growing focus on service
� A.S. Création is already established in this sector
� Less innovation in the industry
• a lot of companies reduce expenses for product development
• the number of companies that promote and further wallcoverings as a
decorative product is declining
� no other company in the wallpaper industry launches as many new
products as A.S. Création
A.S. Création benefits from the consolidation process.
12

A.S. CRÉATION 1974 - 2006
180
150
120
90
60
30
0
150
125
100
75
50
25
0
1
Sales (€ m) Result from ordinary activity
(€ m)
18
34
49
67
109
145
152
74 80 85 90 95 00 05 06
6
Total assets (€ m)
9
12
18
28
92
111
116
74 80 85 90 95 00 05 06
15
12
9
6
3
0
-3
700
600
500
400
300
200
100
0
-1.0
0.5
1.6
1.1
5.2
8.4
13.0 12.7
74 80 85 90 95 00 05 06
Number of employees
7
160
270
303
365
530
635
633
74 80 85 90 95 00 05 06
A.S. Création has become Europe‘s leading wallpaper manufacturer.
13

ANNUAL REPORT 2006
14

KEY-FIGURES: P/L
2005 2006 Change
Sales € m 145.3 152.4 + 4.9%
Total output € m 146.1 154.6 + 5.8%
Gross profit € m 72.8 73.4 + 0.8%
Gross profit margin 49.8% 47.5%
Personnel expenses € m 31.5 32.9 + 4.4%
as % of total output 21.6% 21.3%
Earnings before taxes € m 13.0 12.7 - 2.4%
Return on Sales (before taxes) 8.9% 8.3%
Net profit € m 7.7 10.2 + 31.4%
Return on Sales (after taxes) 5.3% 6.7%
15

SALES
€ m
175
150
125
100
75
50
25
0
132.1
14.0
118.1
Consolidated Sales
145.3
13.7
131.6
152.4
14.1
138.3
2004 2005 2006
Fabrics
Wallaper
The sales increase in both segments lead to the highest sales level
A.S. Création has reached in its history.
16

GROSS PROFIT AND GROSS PROFIT MARGIN
75
50
25
0
66.6
Gross profit
in € m as a percentage of total output
72.8
73.4
2004 2005 2006
The gross profit margin decreased by 2.3 percentage points. In relation
to the total output this equals a gap of € 3.6 m.
60
40
20
0
50.0 49.8 47.5
2004 2005 2006
17

PERSONNEL EXPENSES
40
30
20
10
0
30.1
in € m
31.5
Personnel expenses
32.9
2004 2005 2006
25
20
15
10
5
0
as a percentage of total output
22.6 21.6 21.3
2004 2005 2006
Due to the strong increase of the total output, the relation between
personnel expenses and total output improved.
18

EMPLOYEES
Employees (annual average, full-time equivalents)
700
600
500
400
300
200
100
0
633 635 633
70 69 68
563 566 565
2004 2005 2006
Fabrics
Wallpaper
While sales have been increased by 15.3% over the last three years,
the number of employees has remained unchanged.
19

OTHER OPERATING EXPENSES
20
10
0
17.1
Other operating expenses
in € m
19.5
19.7
2004 2005 2006
15
10
5
0
as a percentage of total output
12.8 13.3 12.8
2004 2005 2006
The other operating expenses are affected in 2006 by increased
transport and waste disposal costs.
20

EARNINGS BEFORE TAXES
15
12
9
6
3
0
11.0
Earnings before taxes
in € m as a percentage of sales
13.0
12.7
2004 2005 2006
Despite the higher sales, earnings before taxes are below the previous
year‘s level.
10
8
6
4
2
0
8.3 8.9 8.3
2004 2005 2006
21

SEGMENT REPORTING
Wallpaper Fabrics
2005 2006 2005 2006
€ `000 € `000 € `000 € `000
Sales 131,811 138,506 14,263 14,428
Earnings before taxes 12,891 12,333 82 337
RoS (before taxes) 9.8% 8.9% 0.6% 2.3%
Cash-Flow 15,818 15,821 210 376
Number of employees 566 565 69 68
The Furnishing Fabrics division has achieved a significant profit in 2006
and has improved its RoS.
22

NET PROFIT
12
9
6
3
0
6.6
Net profit
in € m as a percentage of sales
7.7
10.2
1.9
8.3
2004 2005 2006
5.0 5.3 5.4
Adjusted for a special tax effect, net profit for the year 2006
amounted to € 8.3 m which means that it is in line with the full-year
guidance (€ 8.0 m to € 8.25 m).
8
6
4
2
0
6.7
1.3
2004 2005 2006
23

CASH-FLOW
€ m
20
15
10
5
0
Breakdown of cash-flow
13.9
0.5
7.7
16.0
0.7
8.2
16.2
0.2
8.0
5.7 7.1 8.0
2004 2005 2006
Change in long-term
provisions
Depreciation
Profit after tax
payments
The development of the cash flow discloses that the special tax effect
is non-cash in nature.
24

KEY FIGURES: BALANCE SHEET
2005 2006 change
Non-current assets € m 51.5 51.9 + 0.7%
Capital expenditures € m 8.9 7.4 - 16.5%
Depreciation € m 8.2 8.0 - 2.2%
Inventories € m 26.4 29.0 + 9.8%
Inventory turnover 5.6 5.5
Trade receivables € m 24.2 24.8 + 2.3%
Days receivables outstanding days 56 58
Total assets € m 111.0 116.3 + 4.7%
Equity € m 64.8 71.5 + 10.3%
Equity ratio 58.4% 61.5%
Financial liabilities € m 17.9 15.8 - 11.6%
Debt repayment period years 0.8 0.6
25

FINANCIAL STRUCTURE
46%
Financial structure and total assets
€ 108.9 m
55%
€ 111.0 m
46%
58%
€ 116.3 m
45%
61%
27%
25%
21%
54% 18% 54% 17% 55% 18%
2004 2005 2006
Non- current assets
Current assets
Equity
Non-current liabilities
Current liabilities
Due to the increased net profit the equity ratio reached 61.5%. Overall,
the financial structure of A.S. Création remains very robust and healthy.
26

FINANCIAL LIABILITIES
€ m
25
20
15
10
5
0
Financial liabilities Debt repayment period
21.5
9.2
12.3
17.9
4.5
13.4
5.5
10.3
2004 2005 2006
Cash and cash-equivalents
Net financial debt
15.8
years
1.0
0.5
0.0
0.9
0.8
0.6
2004 2005 2006
Net financial debt divided by cashflow
Financial liabilities declined by € 2.1 m to € 15.8 m as per 31.12.2006.
The debt repayment period is at a low level of 0.6 years.
27

INTERIM REPORT FOR Q1 2007
28

KEY-FIGURES AS OF MARCH 31, 2007
Q1/2006 Q1/2007 Change
Sales € m 40.4 44.5 + 10.2%
Total output € m 40.1 45.2 + 12.7%
Gross profit € m 19.6 21.9 + 11.7%
Gross profit margin 48.9% 48.5%
Personel expenses € m 8.0 8.7 + 9.0%
as % of total output 19.9% 19.3%
Earnings before taxes € m 3.5 4.2 + 20.9%
Return on Sales (before taxes) 8.6% 9.5%
Net profit € m 2.2 2.6 + 18.8%
Return on Sales (after taxes) 5.4% 5.8%
29

SALES
Mio. €
50
40
30
20
10
0
39.0
3.6
35.4
Consolidated sales
40.4
3.6
36.8
44.5
3.9
40.6
I/2005 I/2006 I/2007
Fabrics
Wallpaper
Higher sales‘ levels in both divisions have contributed to the 10.2%
increase in group‘s sales in the first quarter of 2007.
30

EARNINGS BEFORE TAXES
5
4
3
2
1
0
3.4
Earnings before taxes
in € m as a percentage of sales
3.5
4.2
I/2005 I/2006 I/2007
The strong increase in sales in combination with a stable gross profit
margin results in an improved RoS in the first quarter of 2007.
10
8
6
4
2
0
8.7 8.6
9.5
I/2005 I/2006 I/2007
31

SEGMENT REPORTING
Wallpaper Fabrics
I/2006 I/2007 I/2006 I/2007
€ m € m € m € m
Sales 36,883 40,704 3,706 3,975
Earnings before taxes 3,523 4,207 - 32 14
RoS (before taxes) 9.6% 10.3% - 0.9% 0.4%
Cash-Flow 4,271 4,716 - 15 32
Number of employees 561 572 67 67
Both divisions have improved their earnings position.
32

A.S. CRÉATION SHARE
33

CONSUMER GOODS OR CONSTRUCTION?
Use of wallpaper in Germany
10 % New buildings
90 % Redecoration
A.S. Création share is classified as “Consumer Goods“ and not as
“Construction“.
34

SHARE PERFORMANCE 2002 - 2007
Indexed
325
300
275
250
225
200
175
150
125
100
75
50
A.S. Création and SDAX 01.01.2002 - 31.03.2007
01.01.2002 = 100
2002 2003 2004
2005 2006
— A.S. share
— SDAX
Since 2002 the A.S. Création share has performed similar to the SDAX
and has increased value by 167.6%.
35

MARKET VALUE OF A.S. CRÉATION
� Price-earnings ratio
31.12.05 31.12.06 31.03.07
Share price € 28.30 € 36.00 € 42.30
Earnings per share* € 2.78 € 3.65 € 3.21
Ratio 10.2 9.9 13.2
* 31.12.05 und 31.12.06: Effective; 31.03.07: Medium figure of plan for FY 2007
� Market capitalization/Equity
31.12.05 31.12.06 31.03.07
Market capitalization € 78.8 m € 100.2 m € 117.8 m
Equity € 64.8 m € 71.5 m € 74.1 m
Ratio 121.6% 140.2% 159.0%
Market capitalization has exceeded € 100 m while p/e-ratio is still moderate.
36

DIVIDEND POLICY
2004 2005 2006
Earnings per share €/share 2.37 2.78 3.65
Dividend €/share 1.05 1.25 1.65
Payout ratio % 44.3 45.0 45.2
Year-end share price €/share 23.55 28.30 36.00
Dividend yield % 4.5 4.4 4.6
A.S. Création‘s dividend policy aims for a high payout ratio as long
as this is permitted by the company‘s financial situation.
The A.S. Création share is a high-yield paper.
37

SHAREHOLDER STRUCTURE
� The present shareholder structure is as follows:
• Mr. Franz Jürgen Schneider 29.1%
• Mrs. Karin Schneider 10.1%
• A.S. Création Tapeten Foundation 5.0%
• Own sahres (treasury shares) 7.2%
• Ratio Asset Management LLP, London 5.1%
• Free-float 43.5%
100.0%
From the total number of shares of 3.0 million, approx. 44%
are free-float.
38

OUTLOOK
39

TARGETS 2007
� Status quo:
A.S. Création is Europe‘s leading wallpaper manufacturer
• sales- and earnings-level
• unique product range in the industry
� Economic conditions 2007:
• no sustained stimulation from the macroeconomics
• ongoing consolidation process in the wallpaper industry
• competition will intensify
� Targets 2007:
• continued expansion of A.S. Création‘s competititive position
• improvement of the earnings position
40

MEASURES
� Continued expansion of the competitive position
• Product development
− innovation (product and marketing concepts)
− offering the whole range of major wallcovering qualities
− combination of wallcoverings and fabrics
• Stronger internal growth than the market
• Further acquisitions if economically viable
41

PLAN: SALES
€ m
160
120
80
40
0
145.3
Consolidated Sales
152.4
160.0
2005 2006 2007e
Internal sales growth of 5% is planned for 2007.
� uncertain environment esp.
with regard to consumer
spending
� targeted gain of market share
� no additional acquisitions
assumed
42

PLAN: NET PROFIT
12
8
4
0
7.7
Net profit/Earnings per share
in € m in € per share
10.2
1.9
8.3
8.7
to
9.2
2005 2006 2007e
4
3
2
1
0
2.78
3.65
0.70
2.95
3.12
to
3.30
2005 2006 2007e
According to the plan, net profit will exceed the adjusted figure for
2006. Implications of a potential tax reform in Germany have not been
taken into account.
43

END OF PRESENTATION
44