Group - L. Possehl & Co. mbH

The increase in net sales came primarily from Germany and other
European countries, while net sales in North America sank as a result
of declines in the US dollar and trading activity. Germany accounted
for approximately 42 % of total sales versus 39 % in the previous year.
ordinary Earnings Before taxes increased again
After ordinary earnings before taxes reached a record of
e 73.9 million in the previous year, this record was broken again
during the reporting year by approximately 2 %. This development is
particularly encouraging as we succeeded in compensating for lower
earnings in the Electronics segment through growth in the other
segments. As a percentage of sales, ordinary earnings before taxes
amounted to 4.9 % after 5.1 % in the previous year. While we could
largely pass along higher prices for raw materials in the form of
higher selling prices, the weak US dollar negatively influenced the
Group’s success in the reporting year.
the Gain on Sale Leads to a Large Extraordinary result
The extraordinary result contains a e 59.7 million gain on the sale
of our 10 % equity stake in Norddeutsche Affinerie AG (NA). We used
a portion of the gain in the amount of e 10.2 million to pay for the
transition from German to international accounting rules, specifically
by accounting for pension liabilities immediately according to International
Financial Reporting Standards (IFRS).
Substantial increase in Consolidated Net Profit
The consolidated net profit rose by e 15.0 million or 15.1 % to
e 114.1 million. Along with the slight increase in operating earnings,
the higher extraordinary result was primarily responsible for the improvement.
The Group’s tax expenses remained low particularly as a
result of the utilization of loss carry-forwards in Germany as well as
tax rebates. Income taxes as a proportion of ordinary earnings before
taxes amounted to 10.7 % after 7.1 % in the previous year.
The pre-tax return on equity amounted to 27.6 % in the reporting
year. Despite the increase in earnings, it declined by 7.7 percentage
points from the prior year as a result of a significant increase in shareholders’
equity. The EBIT return on sales was 5.6 %, slightly lower than
in the previous year.
EarNiNGS PoSitioN iN tHE
oPEratioNaL SEGMENtS
EARNINGS POSITION IN THE PRODUCTION DIVISION
Letter from the Executive Board
Company Boards
Report of the Controlling Boards
Successful over the Long Term
Group Management Report
Consolidated Financial Statements
Further Information
in e million 2007 2006 Change
Sales 1,219.0 1,175.7 43.3
EBT 64.3 71.6 -7.3
Capital expenditures 21.3 29.9 -8.6
Net sales rose by 3.7 % from the previous year. This increase is primarily
attributable to the Cleaning Machines and Elastomer Processing
divisions.
The Electronics division is entirely responsible for the decline of
e 7.3 million in earnings before taxes, while the other segments improved
their results from the previous year. The segment’s earnings
reflect one-time restructuring expenses.
The decline of capital expenditures for intangible assets and
property, plant, and equipment results from the construction of a new
electronics production site in Dongguan included in the previous year’s
figure.
Precious Metals Processing: High Precious Metals Prices
Have a Positive impact on Sales and Earnings
The upward trend that began in the previous year continued during
the reporting period. The three operating divisions Semi-finished/
Recycling, Surface Technics, and Dental all achieved positive results in
2007 and were able to expand and confirm their market shares.
Semi-finished/Recycling: Nominal income from semi-finished
jewelry could be increased despite declining unit sales for jewelry
alloys. The critical factor here was the special production expertise,
which enables us to manufacture products with higher value added
and higher nominal prices. The increase in nominal sales came both
from Germany and abroad, whereby the international increase was
significantly higher.
The sales of industrial semi-finished products also developed
positively. Due to the increase in precious metals prices the recycling
business revived, even though the prices for precious metal waste
remained under pressure.
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