Consolidated Financial Statements - L. Possehl & Co. mbH

16
GENERAL ECONOMIC CONDITIONS
AND COURSE OF BUSINESS
Overall economy: Euro zone lags behind the
global economic upswing
The global economy continued to develop dynamically in the year under
review; it grew by a good 4 %. The considerable increase in the price
of crude oil – in particular in the fi rst half of the year – as well as the
increase in price of the most important industrial raw materials had
only a slightly negative effect on this positive trend. The fundamental
growth engines were again China and the USA. Both national economies
triggered important growth incentives in other industrial countries
through their high demand for imports.
The economy was clearly more restrained in the Euro zone, however,
despite the fact that economic activity increased slightly over the last
several months of the year. The high price of crude oil and low internal
demand, in particular in Germany, had a noticeable braking effect
on economic development. The gross national product in Germany increased
by only 0.9 % in 2005.
The US dollar had an exchange rate ratio of € 1.36 per US dollar at the
beginning of last year, making it very weak. It recovered again during
the course of the year and amounted to € 1.18 per US dollar at the
end of the year. In an annual average the US dollar was quoted with an
exchange rate of € 1.24, leaving it virtually unchanged compared to
the previous year.
Business trend for the Group: Possehl profi ts from an
international spirit of optimism
The overall economic development had a varied effect on the companies
of the Possehl Group. While the Electronics business division in
particular profi ted from the positive development in Asia, business in
the precious metals sector was rather weak due to the low domestic
demand. International Trading was able to maintain its favorable position
in this inconsistent economic environment and achieve almost as
satisfactory a result as in the previous year.
Economic conditions | Net assets, earnings, fi nancial position
FINANCIAL POSITION
Group Management Report
NET ASSETS, EARNINGS
AND FINANCIAL POSITION
INCOME POSITION OF THE GROUP
Group achieves double-digit sales growth
Sales revenues climbed by 16.3 % compared to the previous year from
€ 695.1 million to € 808.7 million. A crucial factor for the signifi cant
increase in sales is the fi rst time inclusion of the Harburg-Freudenberger
Group in the consolidated fi nancial statements on April 1, 2005.
Sales of € 127.0 million accrued to the Group for the 9-month period.
Adjusted for the business division acquired in the reporting year and
the halted business activities of Nordstahl GmbH during the previous
year, sales revenue increased by 3.8 % compared to the previous year.
With the exception of the Precious Metals Processing business division,
all of the business divisions contributed to the increase in sales.
The increase in sales stretches across almost all geographic regions.
Domestic sales, however, show the smallest increase at a solid 10 %
due to the strong export orientation of the Harburg-Freudenberger
companies.
Due to the acquisition of the Harburg-Freudenberger Group, the share
of sales of the Production segment increased further. It amounts to
57 % of total sales for the reporting year and therefore increased by
5 percentage points. The share of sales accruing to International Trading
is 42 %; the Services division continues to contribute 1 % to total
sales.
Sales by business segment
in € million
338.9
■ Services
■ Trading
■ Production
10.0
459.8